Biomass crops could be worth up to £12million a year to the Pembrokeshire farming industry, it was revealed this week.

Farmers attending an open day organised by the Institute for Grassland and Environmental Research (IGER) were told renewable energy crops have the potential to become a multi-million pound industry in Wales once new markets are established.

Field-scale tests to assess the viability of short rotation coppice willow, miscanthus and reed canary grass have already been carried out in Pembrokeshire with the support of the Bluestone holiday village, which plans to build a UK showcase biomass energy centre as part of the £60m development.

Said local farmer, Paul Ratcliffe, of new farmers' co-operative, Pembrokeshire Bio Energy Ltd: "The Bluestone developers are very energy conscious and plan to provide part of their needs from renewable sources, creating diversification opportunities for farmers.

The crops, grown in conjunction with IGER and Cardiff University, have been 'very successful', he added, with potential income from miscanthus estimated at £600 per hectare per year.

Each hectare will replace 6,000 litres of heating oil and 16,080kg of CO2 emissions, making it valuable for the National Assembly and the Government in cutting emissions by 20% by 2012.

The Bluestone Renewable Energy Centre will be the first of its type in Wales and will place Pembrokeshire at the forefront of sustainable technology in the UK.

It will be utilised as an educational resource for industry and schools to promote renewable energy usage and will solve the dilemma of biomass diversification which currently has no mass market.

Said Mr Ratcliffe: "Once Bluestone establishes a market, this will open the door for other renewable energy initiatives."

Chris Duller, IGER's willow project officer added: "Initial interest has been very favourable since the National Assembly agreed to single farm payments for SRC willow.

"Improving the current energy grant to match that paid in England would significantly improve the economics of growing energy crops in Wales."