On-farm solar, storage, and other local energy systems are changing electricity costs, resilience, and sustainability for small-scale producers
As energy costs rise, many Canadian farms are looking for ways to take greater control of their electricity use. One term that farmers are hearing more often is distributed energy resources, often shortened to DERs. While the phrase may sound technical, the concept is highly practical, and increasingly relevant for farms of all sizes.
What Are Distributed Energy Resources?
Distributed Energy Resources (DERs) are small-scale energy systems located close to where electricity is used, rather than at large, centralized power stations. These systems can generate, store, or manage electricity on-site and may operate independently or alongside the provincial power grid.
Common DERs used on farms include:
• Solar photovoltaic panels on barn roofs or ground mounts
• Small wind turbines in suitable locations
• Battery energy storage systems that store excess power
• Biogas or biodigesters that convert organic waste into energy
• Smart controls and load management systems that shift energy use to off-peak times
Together, these technologies allow farms to produce some or all of their own power, reduce reliance on the grid, and improve resilience during outages.
Why DERs Matter for Farms
Electricity is a growing expense. DERs can help producers by:
• Reducing monthly electricity bills through self-generation
• Protecting against future rate increases
• Improving reliability during grid outages
• Supporting environmental and climate goals
• Creating long-term equity by investing in farm infrastructure rather than utility payments
For many farms, DERs are less about selling electricity and more about offsetting on-farm consumption, which typically offers the strongest financial return.
Solar Power: The Most Common Farm DER
Across Canada, solar energy is the most widely adopted DER on farms, particularly on small and mid-sized operations. Farms are well suited to solar because they often have:
• Large, unobstructed roof areas on barns and sheds
• Land available for ground-mounted systems
• Daytime electricity use that aligns with solar generation
Solar systems are typically paired with net metering or self-consumption models, depending on the province.
In Ontario, early on-farm early solar adopters should also know that Solar Project Versions 1.3 or 1.5 can now be upgraded to generate more revenue.
How Net Metering Works for Farms
Net metering allows a farm to send excess electricity back to the grid and receive credits that offset future power use. Most Canadian provinces offer some form of net metering, though rules vary by jurisdiction.
Key points farmers should know:
• Credits usually offset energy charges, not delivery fees
• Credits typically expire after 12 months
• System size limits vary by province
• Farms must generate primarily for their own use to qualify
In provinces such as Alberta, British Columbia, Manitoba, Quebec, Nova Scotia, and New Brunswick, net metering remains a central option for farm solar projects.
Ontario currently emphasizes self-consumption and zero-export systems, supported by storage incentives and time-of-use optimization rather than traditional net metering.
“For many farms, managing input costs is as important as yield or revenue metrics. During these times of uncertain energy supplies and prices, converting electricity pricing into a known and less volatile price – through DER – makes a lot of sense,” says Garrett Vanderwyst with Axis Solar.
Adding Energy Storage on Farms
Battery storage is becoming more attractive for farms, particularly in rural areas with frequent outages. While batteries increase upfront costs, they can:
• Provide backup power for critical systems
• Store solar energy for evening or early-morning use
• Enable farms to avoid high peak electricity rates
• Improve energy independence
For many small farms, batteries are sized for essential loads, such as water pumps, freezers, or electric fencing, rather than full-farm backup.
Federal Programs That May Support DERs on Farms
Several federal programs can help reduce the cost of DER adoption.
Agricultural Clean Technology Program (ACT)
The Agricultural Clean Technology (ACT) Program, administered by Agriculture and Agri-Food Canada, supports adoption of clean energy technologies on farms, including renewable generation and energy efficiency measures.
The ACT program includes:
• Adoption Stream: Non-repayable funding for proven technologies
• Research and Innovation Stream: Support for testing and demonstration projects
Eligible technologies can include solar power, energy storage, and bioenergy systems that reduce greenhouse gas emissions on farms.
Clean Technology Investment Tax Credit
The federal Clean Technology Investment Tax Credit provides a refundable tax credit toward eligible clean energy equipment, including renewable generation and storage assets. This credit can significantly reduce upfront capital costs for incorporated farm businesses.
Provincial and Utility Programs
In addition to federal support, many provinces and utilities offer programs that may benefit farms:
• Net metering programs across most provinces
• Utility incentives for renewable or efficient electrical equipment
• Financing programs, such as property-assessed clean energy (PACE) models
• Energy efficiency rebates that complement DER investments
Farmers should always consult their local utility before installing any DER system, as connection rules and capacity limits can vary widely.
What Farm Owners Should Consider Before Investing
Before adopting DERs, farm operators should assess:
• Current electricity use and seasonal demand
• Roof condition and available space
• Local net metering or self-consumption rules
• Grant and incentive eligibility
• Long-term plans for farm expansion or electrification
Independent energy assessments can help ensure systems are right-sized and financially sound.
A Practical Step Toward Energy Resilience
Distributed energy resources are not just for large operations. For many small farms, DERs are becoming a practical tool to lower costs, improve resilience, and invest in long-term sustainability.
As energy policy and agricultural climate programs continue to evolve, DERs are likely to play an increasing role in how small farms power their work, protect their bottom line, and adapt to a changing energy landscape.