With a varied landscape, Wales is resource rich in terms of wind and water and a suitable location to develop many different forms of sustainable energy. Whilst farm businesses face increasing challenges in terms of economic stability and traditional production methods, this paper considers the role of renewable energy production as a form of diversification. The study adopts mixed methods as a means of undertaking an in-depth investigation into the role of renewable energy generation in supporting agribusinesses in Wales. Initially a questionnaire obtained 118 responses from farmers in Wales. Subsequently, 15 follow-up semi-structured interviews with farmers were conducted to further investigate the issues from the initial questionnaire. The theoretical contribution of this paper is a segmentation of farmer businesses which allows for distinctions to be made of different attitudes to off-farm income and the adoption of renewable energy sources. Five farm types were identified, varying in relation to farm characteristics, attitudes to diversification, access to renewable energy and resource allocation. These farm types highlight the need for specific policies towards facilitating the increase in renewable energy along with sustaining farming incomes. Furthermore the research provides valuable information to the farming industry on opportunities in renewable energy production, particularly for farmers and farm businesses who are considering diversification strategies.