Analyzing the land and labour productivity of farms producing renewable energy: the Italian case study

Abstract

Abstract The paper computes and analyses some relevant indicators of economic performance of Italian farms producing/not producing renewable energy, and compares the economic results of the two set of farms. The source of data is the European Farm Accountant Data Network; the farms belonging to this network are analysed in relation to their structural differences, type of farming, geographical areas, economic size, as well as the type of renewable energy produced. After an in-depth statistical investigation, the main economic ratios are computed and analysed using also multivariate regression models, with a special focus on the production of solar and biogas energy. In terms of land and labour productivity and fixed factor remuneration, the results show that farms producing renewable energy perform better than the other farms. This positive effect is particularly accentuated in large companies that produce biogas, followed by farms that produce solar energy. There are still many obstacles that limit the production of renewable energy in agriculture; among these, still insufficient research and information on best practices in agriculture and, in Italy, the complexity and dispersion of the institutional legislative framework and of the public support systems. However, the need to increase the production of renewable energy has become a priority for many European countries both in the short- and in the medium term, especially in light of recent events related to the war in Ukraine.