What to know if you’re interested in solar
Reprinted with permission from an article I wrote for Prairie Farmer in July 2022.
One of the more interesting surprises I’ve had in my career was the time when we were approached by a solar development company on one of the institutional farms we managed. Solar farms were just taking off. The proposed lease was quite lucrative. The client would make much more income from leasing the farm to the solar company than we could ever hope to get from an agricultural lease.
In my mind, it was a slam dunk.
Always keen to improve financial performance for our clients, I looked forward to drawing up the paperwork. But much to my surprise, they said no. The clients had already invested in solar energy development and had no interest in changing this portion of their portfolio diversification from ag to solar, despite the additional revenue it would bring.
It’s moments like these that provide a sobering reality check for those of us in the farm management profession: As much as we want to take care of the farms as though they are our own, they are not ours. As members of the Illinois Society of Professional Farm Managers and Rural Appraisers, we subscribe to a code of ethics that says we are entrusted to provide guidance, but ultimately, we look to fulfill their interests over our own.
To provide guidance, you need knowledge.
Recently, the Illinois chapter of the Realtors Land Institute held a meeting and invited solar industry experts to speak, including Zach Lasek, project manager for the east region for Scout Clean Energy. Scout is a renewable energy developer and asset management company headquartered in Boulder, Colo., and operating several solar and wind projects in Illinois.
Companies are focusing on Illinois for a reason, Lasek says, pointing to Illinois’ Climate and Equitable Jobs Act. Signed into law by Gov. J.B. Pritzker in September 2021, this comprehensive bill sets out power sector decarbonization by 2045, creates equitable clean energy workforce development pathways and expands state commitments to energy efficiency, renewable energy and electric vehicles.
To learn more, tune into a webinar from the American Society of Farm Managers and Rural Appraisers on Aug. 27. The webinar, Solar’s Impacts on Rural Property Values, is free to members and available to non-members for a small fee.
What to expect
This is a short list compared to everything a landowner should consider regarding solar development, but here’s a start:
Expect divisiveness. Like the construction of wind turbines, solar development can prove divisive to a community. Landowners who are sensitive to reputation risk may want to take this into consideration. By approaching the project with care but without a heavy hand, landowners can mitigate some risks.
Understand how it ends. What happens when the lease term is up? How will the site be reclaimed? The Bureau of Land and Water Resources within the Illinois Department of Agriculture negotiates an Agricultural Impact Mitigation Agreement with utility companies that specifies how agricultural land is to be restored. Is the agreement adequate? Should the client’s specific lease agreement go further?
Agree on land use. Can the ground be farmed during the lease period next to the solar panels? Agrivoltaics is an approach where agricultural production can be done symbiotically with solar electricity production. Recent research from the U.S. Department of Energy indicates both systems can benefit in some scenarios. Solar panels are more efficient with lower ground temperatures, and certain cropping systems benefit from the increased soil moisture the shading provides.
With all of us paying more at the pump, for me, it’s refreshing to see the growth of alternative sources of energy. Helping farmland owners navigate solar development for their ground is one of the many things we offer as farm managers, whether through full-service farm management or case-specific consultation.