The abolition of Feed in Tariffs and the business rates relief scheme for privately owned hydropower projects has led to a 'slowdown' in on-farm energy investment.
This is according to the Farmers’ Union of Wales (FUW), which has responded to a Welsh government consultation on reviewing renewable energy targets, acknowledging the need to set targets which go beyond 2030.
On-farm renewable energy production has been high on the Welsh farming industry's agenda for decades.
However, the importance of such has been brought into sharp focus over recent years as the UK faces an energy crisis.
The FUW said farms continued to seek ways in which they could diversify and the focus on reaching net zero was increasing.
However, it said the end of Feed in Tariffs and the Welsh government business rates relief scheme for privately owned hydropower projects had led to a significant slowdown in on-farm investment into renewable energy sources
The union said this had 'weakened' the environmental benefits associated with private initiatives, while diminishing the momentum of reaching the "70% of Wales’ electricity consumption from renewable sources by 2030" target.
FUW senior policy officer, Gareth Parry said: “Action is required now more than ever to tackle the UK’s energy shortages and to secure future energy production.
"We have previously written to Julie James MS, Minister for Climate Change, urging her to work with colleagues in other administrations to ensure that all possible actions are undertaken to further increase renewable energy production."
The FUW has welcomed the Welsh government’s ambition to set a target for at least 1.5GW of renewable energy capacity to be locally owned by 2035.
It has also welcomed the devolved government's acknowledgement that the uptake of small-scale renewable energy technologies could be a key contributor to meeting this target.
Mr Parry said that pathways to reaching such targets must include urgent action at all levels of the government.
He added: "This must include the introduction of new incentives for farmers to invest into small-scale renewable energy projects on their land and buildings.
"The removal of barriers to such developments, if the required fivefold increase in the generation of electricity in Wales between now and 2050 is to be achieved."
