The South-west of England utilities company will, from September, offer to pay farmers in eight key areas of its domain up to pounds 40 per hectare over a two-year period for abandoning intensive farming techniques that require fertilisers and pesticides.
"At the moment we are still going through the administration process," said a Wessex spokeswoman. "We are working with the Soil Association and looking for partners."
The annual cost to the UK water industry of meeting government requirements to clean-up water sources after sustained pesticide and chemical nutrient contamination caused by agriculture is put at pounds 150m. Wessex hopes to save on its part of this bill by eradicating contaminants at source.
The company says the capital cost alone of installing water-treatment facilities in the eight areas affected is somewhere between pounds 20m and pounds 30m. Additionally, there would be the costs of operating the new facilities.
Grants from Wessex totalling nearly pounds 1m could be paid to farmers over the two-year period if the take-up rate is 100 per cent. So far, the company says the take-up rate for the scheme is running at 40 per cent.
The money paid by Wessex to the farmers will come on top of a government subsidy of between pounds 350 and pounds 450 per hectare over five years from the Ministry of Agriculture, Fisheries and Food. During the conversion period, farmers are allowed to sell produce but yields do reduce and the MAFF payment is intended to supplement depleted farming incomes during the conversion period.
The eight areas stretch across the South-west from Salisbury to Wincanton and Dorchester. The scheme will be overseen and certified by the Soil Association.
Last summer, Wessex was taken over in agreed bid by Enron Corporation, the Texas-based utilities conglomerate.