Selecting Land For Solar Farming
We seek out suitable land for solar farming and do a preliminary screening for proximity to substations and three-phase power lines, among numerous other factors. Although there is a preference for cleared, level land, we find creative, smart solutions to many challenging terrains.
Unlike brokers or land agents, we only offer leases for land we are committed to develop for a solar project and have thoroughly assessed. An OYA Origination Specialist will walk through the land lease or purchase agreements with you and in some cases, does a site visit.
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Benefits Of Leasing Your Land For Solar Development
Thousands of people around the country own land, and many are not aware of its untapped potential. On agricultural land alone, experts estimate that by installing renewable energy infrastructure on just 1% of existing underused farmland, solar panels could provide 20% of electricity for the U.S.and farmland is only a portion of usable landholdings. The solar industry operates on just over 0.5M acres of installed capacity, but needs an additional 17 million acres of land to achieve an all-electric power production scenario by 2050, a scenario that would support sustainability and energy independence from coast-to-coast.
As landowners struggle amidst inflation, supply chain challenges and commodity cycles, a mutually beneficial partnership with a solar power producer could provide the reliable revenue stream landowners need to thrive for generations.
Underutilized land nationwideagricultural, rangeland, transitional and post-industrialis being given new life through solar development projects. Landowners working in farming, ranching, timber, mining and oil & gas have all discovered that their land can do more for them and their communities.
By leasing their land to solar power producers, landowners reap economic and environmental benefits while continuing operations alongside the solar facility. Here are the top 6 benefits of leasing your land for solar development:
1. New Revenue Streams
2. A Long-Term Partnership
3. Support Energy Stability and Independence
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Leasing Your Land For A Utility Energy Storage System
Solar land leasing, energy storage systems, utility-scale solarif youve read the YSG Solar blog in the past, these are all topics that will be familiar to you. Weve discussed the potential of solar land leasing, explained the term utility-scale solar, and covered all things energy storage, from cost and incentives to state & federal policy. Now, its time to bring all these topics together and discuss leasing your land for a utility-scale energy storage system.
Utility-Scale Energy Storage
The implementation of energy storage alongside renewable energy systems has become increasingly popular in recent times, thanks to improved incentives and technology. Its not just homes and businesses that can benefit from energy storage, howeverbattery systems can be scaled up to benefit the power grid and take the pressure off utilities. Utility-scale energy storage systems are an efficient, environmentally friendly way to store and deliver energy.
Benefits of Utility-Scale Energy Storage
These large-scale energy storage systems can save time, cut costs, and reduce harmful carbon emissions. Batteries are a potential alternative to more conventional grid infrastructure like power lines, easing the strain on the utility grid. Electric vehicles, another increasingly popular piece of green technology, can be integrated alongside an energy storage system as well.
Landowners
Land Use & Solar Projects
Because solar farms are passive land use, they share much in common with traditional agriculture. The solar projects do not generate emissions, have very limited exterior lighting, require only infrequent site visits from company personnel and are low to the ground. In short, solar farms are good neighbors and create far less impact on their surroundings than almost any other use. Solar farm lease rates are most competitive with traditional agricultural methods.
In more urban areas, solar farms must find land that is otherwise not prime for development. This land can have limited/challenging access or be located next to a more unpleasant use such as a wastewater treatment plant, manufacturing facility, or any other facility that generates significant noise, produces unpleasant odors, or creates other nuisances.
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How Do Solar Leasing Companies Make Money
The owner of the solar farm makes money when the electricity is sold. The amount you pay to lease your land depends on the electricity rates charged in your region and the prices charged by solar farms. The electricity rate per kilowatt-hour is based on the type and number of panels in the solar farm.
Community Solar A Different Type Of Power Plant
Unlike large-scale utility solar, community solar gardens are solar power plants with multiple subscribers. These subscribers are treated as though the electricity is generated on their property. They offset their electricity bill with the electricity produced by the garden, and because solar is so inexpensive, they pay less than they would otherwise pay through their electric bill.
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Diversify Your Income Grow Energy
A solar garden is a solar electric array with multiple subscribers connected to the utility grid. If you have a good location, we want to lease it from you to provide people with access to solar.
Utility customers within the solar gardens service area, including residences, businesses, local governments, non-profits, and faith-based organizations, can all subscribe to the sun. Its like an agricultural lease, and you are the landlord.
Questions You Should Ask Before Leasing Your Land For A Solar Farm
Solar Developer» 5 Questions You Should Ask Before Leasing Your Land for a Solar Farm
Know what questions to ask before leasing your land for a solar farm
If youre a farmer or landowner looking to lease your land for a solar farm, you may have a ton of questions about the process. This is completely normal, as most people dont have enough experience with the solar industry to make an informed decision to lease their land for a solar project.
Your go-to resource throughout the process will be the same one as is offering the lease, your solar developer, land agent or broker, which makes it all the more important you take the time to inform yourself before signing.
From the get-go, you should choose someone who is willing to work with you to make sure youre both on the same page, especially when youre signing a lease to land that you own.
To help you know what to discuss with your solar developer, weve provided the top five questions you should be asking before deciding to lease your land for a solar farm.
A quick side note: Solar Developer vs. Broker
There is a key difference between leasing land to a solar project developer versus a broker or land agent.
Solar project developers have a vested interest in getting the project completed and because of that, want to build a long-term relationship with you. In contrast, the brokers or land agents are just to looking to buy or lease your land with as little interaction as possible to just get the job done.
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What If You Live In A State That Doesnt Have Solar Access Laws
If youre not able to leverage solar access laws at the state level, dont worry, its still possible to go solar as an HOA member! To start, make sure you understand the existing solar policies at the state, local, and organizational levels. As previously mentioned, towns and cities may have their own solar policies, so its worth looking into even if you live in a state without solar access laws. Additionally, its important to understand the HOA bylaws as they relate to solar panels if you intend to negotiate a solar panel installation.
If youre trying to get approval from your HOA board, reinforce the positive benefits of solar homes in the neighborhood: it helps property owners save money, can increase your propertys value, and decreases the carbon footprint of your neighborhood. The solar industry also helps support your local economy!
You can also get other property owners in the neighborhood on board and show solidarity. If youre still having trouble getting approval from your HOA for solar panels, look at possible technology alternatives: some might be okay with solar shingles or other solar technologies that still help you save money.
Stable And Quiet Neighbors
Solar projects make quiet, non-intrusive neighbors. The solar farm will have similar characteristics to a field of corn in that it is only 4 to 10 feet high, with 10 feet being the peak height as the panels rotate during the day to follow the sun. Solar farms are enclosed by fencing and landscaping to minimize visual impacts and often add hundreds of trees to the neighborhood. As a good neighbor, solar farms dont have wild parties or play polka music at 1am!
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Other Supply And Demand Issues
Lease rates can spike, at least temporarily, in response to a variety of triggers. For instance:
- A state announces a new Renewable Portfolio Standard target
- A utility or corporate buyer of energy announces they will be issuing a Request for Proposal to procure renewable energy in a certain region
- A utility announces they are upgrading or building new transmission infrastructure
- An existing tax incentive for solar projects is approaching retirement
These kinds of short-term triggers can spur bidding wars between developers to secure your land.
There are longer-term, structural supply and demand issues, too. California, for instance, is the most developed state for solar. There, the land has been exhaustively picked over by developers for years and the easiest to develop, most affordable land is already under lease. As a result, the supply of land is now constrained while demand is still present, which is driving up lease rates toward $1,000/acre.
Are Solar Leases Worth It
A lease allows you to invest in solar farms, but you have to pay for them upfront. The lease payments can defer the cost if your land is very valuable. Leasing land for solar farms is another way to make money. For example, if you had a solar farm on your land and sold the electricity, you would pay less in taxes and lease fees.
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Shining A Light On Agricultural Solar Energy Development Webinar Series
Webinar overview
Solar energy developers are contacting farm owners to secure land for solar energy projects. In an effort to help farmers understand the renewable energy landscape, nuances of solar project leases, zoning considerations, and accompanying tax implications, MSU Extension, Michigan Farm Bureau, and the Michigan Energy Office held a series of meetings for farmers at various locations across the state. Farmers who participated in the programs left with valuable, practical knowledge to help them determine if a solar lease agreement is a sound decision for themselves and their community. MSU Extension staff with agriculture, lease agreements, tax, and zoning expertise provided the educational content. Two webinars were offered in addition to the statewide meetings. The content for each webinar is identical to what was presented at a meeting. Both webinars were recorded and can be accessed by clicking on the links below.
The first webinar addresses the following topics:
- Context for solar energy development on Michigan farmland.
- Community vision for solar energy.
- Zoning approaches.
- Siting considerations for utility-scale solar.
- Integrating solar with existing ag systems.
Top States For Solar Leasing
The state with the most solar farms are California , Arizona , Colorado , New Jersey and Massachusetts . In 2014 and 2015, Texas had the most solar farms operating in the United States.
As of October 1, 2016, 35 states had state or utility incentives for installing photovoltaic systems on homes and other buildings. By 2016, the cost of solar electricity had dropped 58% in the United States since 2010.
Other great states include:
- Vermont: Lease is $2.50/square foot
- Illinois: Lease is $1.75/square foot. Illinois is the nation’s leader in commercial solar installations as of September 2016.
- Indiana: Lease is $1.20/square foot
- Georgia: Lease is 10 cents per watt
- Wisconsin: Lease is $2.50/square foot
- Tennessee: Lease is $1.50/square foot
- Florida: Lease is $2.00/square foot
- Texas: Lease is $1.00/square foot
- Utah: Lease is $2.50/square foot
- Idaho: Lease is $0.50/square foot
- Nevada: Lease is $1.
- Wyoming: Lease is $1.75/square foot
- North Carolina: Lease is $1.25/square foot
- Ohio: Lease is $0/square foot
- Delaware: The lease of an acre is $21.20
Indiana, Georgia, Tennessee, and Washington are now offering a community choice option for alternative renewable energy. The Federal Communications Commission has approved a national standard for community choice programs.
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Leasing Your Land For Solar Energy Development
- Language
As utility-scale and community solar projects are increasingly proposed across New York and Pennsylvania, greater numbers of landowners are being approached by land agents, working for solar companies, interested in leasing their land. With attorney Scott Kurkoski presenting on key solar lease terms, Leasing Your Land for Solar Energy Development will give participants an overview that prepares them to more beneficially discuss leasing issues with developers and with the attorneys who would preferably advise landowners on specific leasing language before a lease is negotiated or signed.
Who Are The Players
Regulated utilities and municipal utilities supply about 81 percent of Missouris electricity to 77 percent of the states total electricity customers. Electric cooperatives, which distribute electricity locally to a large geographic footprint in rural Missouri, supply about 19 percent of Missouris electricity to 23 percent of the states customers.
Landowners may be familiar with utilities offering solar energy leases. But it is also common to receive proposals from lesser-known renewable energy development companies that plan to sell power under contract to a utility, industrial customer or out-of-state buyer.
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Gain From Additional Income As Well As Your Payments For Leasing Your Land
The operator of a solar park often has to perform further works as mitigation measures. These could be planting hedges of native trees or creating open orchard meadows. Regional seed mixtures are also sown on the land to preserve plant species. SENS always looks to complete the mitigation measures in cooperation with the landowner or a local landscaping contractor. During operation of the photovoltaic park, SENS always offers the ground maintenance of the site to the landowner. These are ways further income can be generated in addition to the leasing payment.
Discuss your options with us and secure an additional source of income for the next 30 years through leasing your land! Do you have a large, unused roof with an area of at least 1,000 square metres? You can also lease your roof for photovoltaic system use.
How Does A Solar Land Lease Work
A solar land lease is generally a long-term agreement, somewhere in the region of twenty-five years, and payments are made annually on a per-acre basis. The payment rate will be agreed in the contract between the landowner and developer and it should be a fair price for both parties. As solar energy generation is consistent and predictable over time, fixed, per acre rental rates are the most common payment structure. This allows for a reliable revenue projection over the course of the lease period, and annual rent escalation is usually a part of the lease agreement, with rent escalation rates commonly between 1.5% and 2.5%.
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Can You Show Me Other Solar Farm Projects Youve Done
When considering signing a lease with a solar developer, you want to ensure that they know what theyre doing. If the solar developer cannot point to any renewable energy projects, this could be a red flag. They may have just started in the solar industry or worse, they dont have the knowledge or expertise to get the project to construction.
Its important to ask your developer how many projects they have brought to operational having a track record of completed projects is a great indicator of a reputable solar developer. They should have no issue with providing a list of operational projects and may even have a list on their website, which you should take the time to view in any case.
When agreeing to sign up for a long-term lease, you want to make sure that your solar developer signs leases with the intent of developing a project instead of holding vast areas of land with no intent to follow through with their promises.
How Do I Know You Are The Developer To Go With When Considering Leasing My Land For A Solar Farm
A good, reputable solar developer should keep you informed throughout the whole process. Along with this, they should recognize that for you, this is a big decision. No reputable solar developer will exert undue pressure on you to sign a contract without giving you time to review the lease with a lawyer, if you so choose.
Throughout the process of a solar project, solar developers work with you to ensure that you are always kept in the loop. You should be their number one priority because it is your land that will be used for a solar farm.
We always encourage our clients to ask us questions so we can address their concerns, and we encourage them to keep in touch with any queries they might have. We strive to build a long-lasting bond with those who lease their land to us, and any solar developer you choose should do the same.
To recap, when solar companies are visiting you onsite, remember to use this time to ask any questions or address any concerns you may have about the project.
The five questions weve listed above will give you a good starting point for any other inquiries you may have. Your solar developer should want you to be fully comfortable with your decision and should want to build a relationship with you. If you would like to know if your land qualifies for solar leasing, we recommend reading our post about the top solar farm requirements.
Watch how a land lease for solar farms has helped our clients: Solar Farming in Jefferson County, NY
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