THE changing energy market offers huge opportunities for farmers - but a conference near York was told that they must get to know the market and be prepared to work closely with fellow farmers and others in the chain.

Some major power stations were already looking at converting from coal fired to biomass and renewable energy and the Government was looking at the security of future fuel supplies as well as environmental issues.

Peter Billins, chief executive of British Biogen, which represents all sectors of the bioenergy industry, said the energy market was definitely changing.

Nuclear power stations would be decommissioned between 2006-15 and North Sea oil and gas would begin to decline from 2004.

"By 2020, 90pc of UK gas will be imported," said Mr Billins, "Last winter we began importing it for the first time, so we are already seeing the demise of North Sea gas."

The Government was looking at where future supplies would come from and the security of that supply. "For the first time I am hearing them talking about fuel security," said Mr Billins.

He was addressing Monday's "Fuel for thought - a strategy for farmed energy crops" conference at the Central Science Laboratory, near York.

Mr Billins said growers should not be frightened of working closely with people who produced fossil fuel as multi-fuel power plants were being looked at.

A balance of existing and new fuels was a good and sensible way to get started.

The existing production and distribution of electricity was based on a model dating back to the Sixties, when power stations were next to coal mines. "The mines have gone but the power stations are still in the same place," said Mr Billins.

"There is a huge amount of energy wasted in generating electricity and the way to save that is by more local production and use. We are looking at biomass."

It was interesting that the Government was now looking at district heating systems.

Electricity production was the area with the greatest difficulties and would be subject to great change over the next six years. Power stations were having many regulations imposed on them over emissions and that was why the coal industry had made approaches to work together to develop markets for farmers who grew biomass.

Mr Billins said farmers should look at their crops as a barrel of oil which had value.

"Farmers have got to get to know the energy markets," he said, "There are opportunities in electricity, heat and transport fuel." The opportunities were myriad. "They could be at the farm scale, village or town to the very large-scale power stations," he said.

There were already many individual renewable energy schemes operating, such as heating systems for schools and leisure centres.

While publicity tended to centre on wind power, it accounted for only 2.7pc of the renewable energy market - biomass made up 86pc.

Melvyn Askew, head of the agricultural and rural strategy group at the CSL, said the Government wanted to generate 10pc of electricity from renewables by 2010, which was a very short timetable.

The opportunities looked good, but it was vital that all parts of the chain talked to each other to pull it altogether. "In the renewable area, the world is your oyster, but you do need to get together to make it happen," he said.

John Gilliland, president of the Ulster Farmers' Union, explained two areas he had got into on his own farm.

Northern Ireland has a horrific problem with phosphates but he is growing willow coppice to overcome that.

The country has 400 rural water sewage treatment works and, after a successful scheme at a works near Londonderry, he is now negotiating to repeat it elsewhere.

He planted ten acres of willow at the Culmore sewage treatment works which proved successful in taking up and disposing of the dirty water.

Mr Gilliland had also gone to the rescue of a 250-bed hotel which was told it would be closed down if it did not solve its dirty water problem.

He planted 4.5ha of willow and the problem was solved. The hotel now wants Mr Gilliland to supply them with a boiler to supply its heating using the willow.

He also supplies wood chips to heat a village community centre and, after setting up his own production system on the farm, supplies heat to a rehabilitation centre via the national grid.

He would like to see more farmers sell heat directly, rather than supplying wood chips. Mr Gilliland said there were many rural consumers paying high prices for electricity who would be only too happy to pay a local farmer to supply it to them directly