Leasing land for solar development...

[Turbys_1700]

Has anyone out there been approached by a solar company wanting to lease some of their farm land?
I have...
By two companies...
Both reputable...
In what I have gathered on the net acreage lease prices can range from $400 to $1000 per acre per year...
Issues concern the term of lease, annual increases, liability during construction and during operation, taxes, and clean up after the lease expires...
Does anyone here have any direct experience with this or does anyone out there know someone that I could contact???
Here in NC our local utility companies must produce I think 12% of their electricity with renewable sources withing the next 10 years or so...
Thus the rush to get as much solar on the grid as possible...
Any thoughts or input would be appreciated...

 

[Depmandog]

Has anyone out there been approached by a solar company wanting to lease some of their farm land?
I have...
By two companies...
Both reputable...
In what I have gathered on the net acreage lease prices can range from $400 to $1000 per acre per year...
Issues concern the term of lease, annual increases, liability during construction and during operation, taxes, and clean up after the lease expires...
Does anyone here have any direct experience with this or does anyone out there know someone that I could contact???
Here in NC our local utility companies must produce I think 12% of their electricity with renewable sources withing the next 10 years or so...
Thus the rush to get as much solar on the grid as possible...
Any thoughts or input would be appreciated...

You will want to engage a law firm with land lease experience to protect you and get you the most value out of the lease. Think oilfield, utility easements, ect when searching for a lawyer. Please don't try to do this alone.

There are several TBN threads concerning this very issue. If memory serves, I believe one of our fellow members is such an attorney. A google TBN site search should turn up the threads for reference.

Sounds interesting and potentially profitable!! Good luck

 

[RickB]

I know a landowner up here who has a lease proposal on the table for a 60 acre solar installation. The offer directly addresses all concerns you list in your second sentence and the cash value of the lease is substantially above your listed range. The numbers may well not be relevant for NC but you can PM me if you wish.

 

[dmccarty]

Has anyone out there been approached by a solar company wanting to lease some of their farm land?
I have...
By two companies...
Both reputable...
In what I have gathered on the net acreage lease prices can range from $400 to $1000 per acre per year...
Issues concern the term of lease, annual increases, liability during construction and during operation, taxes, and clean up after the lease expires...
Does anyone here have any direct experience with this or does anyone out there know someone that I could contact???
Here in NC our local utility companies must produce I think 12% of their electricity with renewable sources withing the next 10 years or so...
Thus the rush to get as much solar on the grid as possible...
Any thoughts or input would be appreciated...

A company just built a large solar installation in a field in NE Chatham county near Chapel Hill. I forget the company's name but I think I would recognize it if I saw the name again. I have seen the company's trucks here and there over the years. I can't answer your questions but you might be able to dig up some information on the installation. It was covered in the news over the last 3-6 months.

I happened to drive by the place last spring, and to be honest, it was kinda ugly. They put up a chain link fence with green strips to hide the panels. Not sure which is uglier, the fence or the panels. You may or may not care about the looks of the installation but looks should be considered.

Obviously you need an attorney but I would be making the company assume responsibility for liability and taxes. For clean up, seems like a bond would be in order.

Find out how many kilo watts they are going to put up per acre to figure out how much money they are making. Our area of NC gets about five solar power producing hours a day. If you know the number of panels they are installing, and their power ratings, you can figure out how many watts they will produce over the five hours. This will also help you figure out the amount of money they will make. There are tax incentives to do this so the money they are making is NOT just in the power produced.

Later,
Dan

 

[Turbys_1700]

Thanks for the info Dan...
The company is Strata Solar from Chapel Hill...
They are one of the companies...

 

[hosspuller]

I toured a solar farm near Lexington, NC The installation doesn't allow you to use the land for anything else .. cattle, hay, etc ... Sounds like a low $$ offer for basically land per acre.

 

[dmccarty]

Thanks for the info Dan...
The company is Strata Solar from Chapel Hill...
They are one of the companies...

Yeppers! That is them!

I looked for some aerial photos of the installation I saw but I could not find an image with the panels in place.

Later,
Dan

 

[dmccarty]

I must have had a brain infarction yesterday but last night I remembered DSIRE, aka, DSIRE: Database of Energy Efficiency, Renewable Energy Solar Incentives, Rebates, Programs, Policy and the NC State Solar Center,NC Solar Center - Advancing Clean Energy for a Sustainable Economy.

They might have information that would be helpful. The NC Extension Office is usually a good source of information about land use issues but a solar farm is so knew they might not have any documents but it would not hurt to try.

Another thing that hit me was last night was how can the company escape from the contract? Much of the money to be made in solar power is because of government tax payoffs and regulations. What happens if these tax incentives and regulations disappear and the installation is no longer a money making operation?

There used to be a dam in Carbonton, NC on the Deep River. A dam has been on that site as far back as the late 1700's or early 1800's. NC state built a series of dams and locks with private and public money as far as Carbonton to try to use the Cape Fear and Deep river as a transportation network. The Deep river held the only coal mine(s) in NC and it was hoped river transport would allow the movement of the coal. The dam built in the 1800's was washed out by a hurricane. A new dam was built on the site in the 1920's to provide power for the region but after decades of use the dam was shutdown from power production. The dam simply was not efficient enough for power production to handle demand. In the Carter administration, the dam was reopened for power production because of "green" tax credits. The dam was not any more efficient when it restarted, and when the tax credits went away, so did the power. A few years ago, the dam was torn down to improve water quality.

Certainly if the PV installation was taken out of use, there would be value in the panels and support structure but would that value pay for removal? One story I read about the installation in Chatham county said that the supports were driven 8 feet into the ground. Those could be a PITA to remove.

Later,
Dan

 

[Redneck in training]

My wild guess is that 1 ac of solar generating facility could produce up to $20000 (at 3.8c/kWh) in electric power/year. Needless to say I might be way off.