Greenhouse Climate Study and Financial Assessment

A Greenhouse Climate Study and Financial Assessment for a new or existing protected cropping or hydroponic project covers a range of aspects, from the proposal for a detailed business plan through to a climate study, system design and energy usage.

PROPOSAL

The proposal is essentially a case study to determine the production potential and estimated capital costs that could be presented to a financial institution (or other authorities) as a detailed feasibility and initial business plan, and includes the following:

  • Detailed climate study for your location that explores the following: Maximum, Minimum and Average 24hr Temperature, Humidity, Cloudy Days, Sunshine Hours, Daily Radiation, rainfall, wind speed and direction (includes data tables and graphs). A climate study will reveal the necessary greenhouse technology required to successfully produce your selected crop in your location.)
  • A study on the mean daily and annual energy requirements of the location, including a comparison of the average energy use in % and GJ (tailored for your nominated fuel source).
  • A study on the mean daily and annual water requirements of the location, including a comparison of the average water use and rainwater harvest in megalitres.
  • Above data is factored into Dutch modelling software (Tomsim) to predict production potential (kg/m2 or annual units) for different CO2 (carbon dioxide) levels, radiation (sunlight) levels, crop age (days) and average 24-hour temperatures for each location.
  • A full 'EBIT' (Earnings Before Interest and Taxes) and 'ROI' (Return on Investment) study for your size project, crop and location (with summary).
  • A full pricing summary (Excel spreadsheet) that allows user to individually select each technology item proposed, that reveals total project capital costs, cost per m² and % of total.
  • This climate and financial proposal can be tailored to suit most greenhouse crops.

DOCUMENTS

This report includes the following six (6) documents:

1. Greenhouse Climate and Financial Feasibility Study (key feasibility document)

2. Greenhouse Development Resources (overview of project site basic metrics)

3. Greenhouse Technology and Hydrology Study (overview on typical technologies and rainwater harvest and storage)

4. Greenhouse Yield Risk Analysis (study on project risk factors)

5. ROI Study (project financial feasibility study)

6. Basic System Design (diagrammatic plan layout of a typical greenhouse system)

The main feasibility document provides for some detailed technical information (for typical projects), meticulous assessment of the local climate and its impact on greenhouse production, yield analysis on a range of greenhouse vegetable technologies and a range of CO2 enrichment levels, and culminating in a full ROI and EBIT study taking into account all the above factors. Also included are full data tables and graphs on the local climate.

The greenhouse development resources document is a quick overview snapshot of the project proposal that includes basic metrics on a range of common development elements, for your information. Additionally I include an example system design plan that could guide you on how to layout an effective, integrated and efficient system.

Should you proceed with this climate study and financial assessment you will receive all the tools to automatically calculate production costs and investment levels, etc with an interactive ROI and EBIT study Excel spreadsheet.

At this point, we instigate a 'Stop or Go' based on the results of this feasibility study whereby we decide if further work is required or desirable.

LOCAL CLIMATE AND RETURN ON INVESTMENT STUDY

It is necessary for the process to begin with an in-depth study of your local climate to reveal the necessary production technologies required to optimise your internal greenhouse climate to maximise yield and quality.

These technologies are then factored into an ROI study to compare investment with production costs that include the following detailed areas of study:

  • Greenhouse Size (m2)
  • Crops per Year
  • Total Land Cost
  • Total Office and Amenities
  • Total Greenhouse and Packing Capital
  • Total Plant and Machinery
  • Total Working Capital
  • Total Capital Investment
  • Total Income
  • Total Greenhouse Operating Costs
  • Total Packaging and Freight
  • Total Variable Costs
  • Total Gross Margin
  • Total Overhead Costs
  • EBIT (Earnings Before Interest and Taxes)
  • ROI

OBTAINING CLIMATE DATA

If you are in an international location, I may require you to provide all the necessary climate data from your local meteorological office for me to factor into the models. If an Australian location, then I can access this information from our own Bureau of Meteorology.

An example of what is the minimum required climate data is attached below. If you wish to proceed, I require the following information to begin:

  • Site location (street address not essential, but general area ok).
  • System size (in m2 or hectares).
  • Company name ('??? Hydroponics' etc).
  • Site Plan (if a current site, but may not be necessary if it is a new site with reasonable flat land and obstruction free)
  • Crop (whether tomatoes, cucumbers, capsicum, eggplant, lettuce, herbs, Asian greens etc.). It is usually best to restrict to maximum of one crop initially as too many crops makes it very difficult to develop a full ROI study. I can produce a ROI report for 1 x vine crop and 1 x leafy green crop if required.

ENERGY

If heating is required, I strongly suggest that in looking for suitable land, try hard to get natural gas if at all possible as it provides both heat and CO2 at a reasonable price (LPG is also suitable but the price is not so reasonable). Other energy sources include coal, biomass etc. with cheaper running costs but increased investment costs for boiler systems and handling raw products, etc. In addition, there is no clean CO2 capture possible from these alternative energy sources (bulk pure CO2 could be used as an alternative, but again may cost more).

SUMMARY

This information (collated over a period of time) is a powerful tool that models potential production and financial viability for your new or extended greenhouse project.

COST

The fee for providing services as described to produce the above six documents personalised for your location, climate, system size, necessary technologies and crop is available on application (+ GST/VAT if applicable).

PROCEDURE

Please advise if you wish to proceed with these services from Graeme Smith Consulting as outlined above and what payment arrangements you wish to make. I can issue a Tax Invoice as required. Feel free to contact Graeme Smith Consulting to discuss any aspects of a feasibility study.

MINIMUM CLIMATE DATA REQUIRED FOR GREENHOUSE and HYDROPONIC PROJECTS

  • Project Location (address or general area)
  • Latitude
  • Longitude
  • Elevation (m)
  • Mean Daily Maximum Temperature (deg C) for each month and annually
  • Mean Daily Minimum Temperature (deg C) for each month and annually
  • Mean Daily Average Temperature (deg C) for each month and annually
  • Highest Ever Recorded Temperature (deg C) for each month and annually
  • Lowest Ever Recorded Temperature (deg C) for each month and annually
  • Mean 9am (or Day) Relative Humidity (%) for each month and annually
  • Mean 3pm (or night) Relative Humidity (%) for each month and annually
  • Mean Daily Sunshine (Hours) for each month and annually
  • Mean Radiation (Mega Joules/m2/day or kWh/m2/day) for each month and annually
  • Mean Rainfall (mm) for each month and annually
  • Mean Average Wind Speed and Direction (9am and 3pm) or (Day and Night) for each month and annually (or Annual Wind Rose, see example below)

All mean averages above should be measured over a significant time of 10–20 years or more if possible for improved accuracy.