By Debbie James

A plan to scrap a business grant for hydropower diversifications on Welsh farms could result in some becoming unviable.

The grant, which has paid out £1m of funding to the sector in the past four years, gives businesses in Wales relief from high business rates that hydropower schemes are eligible for.

But from April 2021 funding will only be available for community-run schemes.

The British Hydropower Association (BHA) said 50 non-community schemes – 75 per cent of the small-scale hydropower sector – would be affected with some forced to close.

The grant was introduced following the Valuation Office Agency’s recalculation of business rates in 2017, which saw rates for some businesses increase by up to 1,000 per cent, according to the Farmers’ Union of Wales.

Ed Bailey, whose family run a sheep and cattle farm in Snowdonia, appealed to the Welsh Government to rethink the proposal.

“The Welsh Government says that Welsh farming families need to diversify more to manage the risks associated with Brexit.

“But how can the farming community trust their stance if, on the other hand, the same Welsh Government is willing to pull support from those farmers who have – like us – diversified, particularly when they have the evidence of the impact this will have on those people that the grant supports?”

The BHA says it is instead calling for a long-term solution where the business rates paid by operators are instead based on the amount of energy they generate.