Proceedings

PR – The Future Contribution Of Bioenergy Enterprises To Rural Business Viability In The U.K. (p39-53)

Bioenergy has been granted an official role in the UK to contribute significantly to sustainability targets in the coming years and yet the position with farmers and rural entrepreneurs is generally confused. Financial support, electricity tariffs, the availability of advice and the profit foregone from other enterprises have all fluctuated. The level of adoption of the new technology is not as advanced as in other EU countries. This study seeks to discover why this could be by exploring the entrepreneurial, financial and motivational environments that bioenergy adopters are working in.

The following hypotheses have been developed:
1. The entrepreneurial environment for bioenergy development in the UK is sympathetic to the needs of this emerging industry;
2. Adopters of bioenergy are positively motivated towards the venture; and
3. Farm based bioenergy enterprises make a positive contribution to overall farm business viability.
The UK government is looking to rural entrepreneurs to play a role in this through the adoption of bioenergy technologies which can contribute towards achieving the country’s energy and climate change targets and at the same time offer potential farm enterprises that could be viable long-term contributors to farm enterprise sustainability (NFU, 2008). The rate of adoption of bioenergy on-farms has been lower than expected suggesting that government objectives might not be achieved. This study extends and applies the concepts of entrepreneurship environment and country institutional profiles (Busenitz et al., 2000; Gnyawali and Fogel, 1994; Kostova, 1997) to a specific domain of entrepreneurship in the land based bioenergy sector in the UK.

The UK bioenergy industry is comprised of a number of enterprises that reflect a relatively densely populated country that has historically comprised an even split between livestock/grass based enterprises and arable based enterprises. The former attracts interest in anaerobic digestion and biogas, whilst the latter attracts interest in biofuels and the combustion of wholecrops and crop residues for heat and power.

The methodology and results of this study are expected to provide a framework geared towards stimulating the uptake of bioenergy on land based enterprises as a means for their regeneration and growth. A capital decision making model for the bioenergy sector is expected comprising of both qualitative and quantitative business drivers which explain the viability of farm based enterprises. This model should provide a basis for policy formulation as well as serve as an investment decision tool for all stakeholders involved with capital investment decisions in bioenergy enterprises.

Keywords: Bioenergy, entrepreneurship, entrepreneurial environment, viability, sustainability, UK

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Author(s): Mbzibain, A., Tate, G.

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Organizations(s): University of Wolverhampton Business School