What Happens to Your Land When You Sign a Solar Lease?
Many landowners worry about leasing land for solar because it might restrict how they use their property throughout the lease duration. As someone who has been maintaining your land for farming, ranching, or recreational use over many years, it makes sense that you would want clarity on the changes solar leasing will bring.
Solar leasing affects some land uses but allows landowners to utilize parts of their property while securing consistent income over the lease term. This guide explains what landowners should expect in the process.
Which Types of Land Usage are Affected?
Solar leasing can affect whether you can maintain farming operations or continue raising livestock on your property.
The Solar Lease Will Utilize Specific Portions of Your Land That Meet Criteria for Solar Panel Installation
With a solar lease arrangement, your property remains mostly intact since only those areas appropriate for solar panel placement will be utilized.
Solar developers conduct site assessments to determine:
The project size determines the number of acres required for solar panel installation.
Which sections of your property obtain solar exposure most effectively.
Solar panels should be placed in areas that do not include wetlands or steep slopes and stay clear of protected zones.
Solar developers identify the locations for access roads and equipment storage during site assessments.
Owning a large property means you might only dedicate a segment to solar panel installation while preserving other sections for agricultural activities and recreational pursuits.
The Ability to Farm on Leased Solar Property Depends on the Specific Conditions of the Lease Agreement and Farming Practices
The possibility of farming on leased solar land rests on specific lease agreement terms along with the farming methods utilized.
You generally cannot practice large-scale row cropping when solar panels cover agricultural land. However, some leases allow for:
Farming on unused portions of the property.
Some landowners keep planting crops until their solar project starts construction while temporary farming takes place.
Shade-tolerant vegetables and berries or plants that support pollinators can grow successfully beneath or between solar panels in agrivoltaic systems.
A number of solar farms allow livestock grazing, and sheep, as well as specific smaller animals, can co-exist with the solar infrastructure. Solar developers might support grazing as an organic solution to control plant growth near their panels.
Before signing a lease, you can negotiate specific land-use terms whenever maintaining agricultural use matters to you.
Can You Access Your Land While the Solar Lease Is Active?
The developer gains the land usage rights through solar leases, but landowners retain limited access as determined by lease specifics. Here’s what to expect:
The fenced solar farm area provides active solar operations with safety and security measures.
As long as only part of your property is leased, you retain complete access to the remaining land.
Developers maintain access roads, which landowners can use to access their property.
Negotiating specific access terms before signing a lease allows you to maintain necessary land usage rights.
What Becomes of the Property Once the Solar Lease Expires?
A common misunderstanding about solar leasing involves the belief that the land becomes permanently unusable for future generations due to its permanent alteration. A solar lease stands as a temporary contract, which mandates land restoration to its initial state when the lease comes to an end. Property owners who enter into solar leases can rest assured that their land will remain environmentally sound and usable for future purposes after the lease ends.
Solar leases generally span a period of 25 to 40 years. The solar company functions as the operator and caretaker of the solar panels for the lease duration while assuring their proper operation and energy delivery to the grid. At the end of the lease term, the solar company must take responsibility for site decommissioning, which includes the removal of all solar farm infrastructure.
The required removal includes:
Solar panels along with mounting structures, inverters, underground cables, access roads, and any other equipment that was installed during the project.
Solar farms differ from permanent industrial sites and residential areas because they are built with planned removal in mind, and developers must legally restore the land to its original state per the lease terms.
Solar companies need to adhere to stringent guidelines during the land restoration phase of solar leasing to guarantee the land remains functional after decommissioning. To protect landowners from cleanup costs, developers allocate specific decommissioning funds within their contractual agreements. The procedure involves precise disassembly and recycling of panels alongside the removal of foundations and electrical systems, followed by soil restoration to its natural state.
Solar panel installation leases typically leave the soil beneath untouched, which maintains its quality and prevents erosion. The landowner gains full authority to use their property after the removal of solar infrastructure.
Certain landowners revert to traditional agriculture like crop cultivation and animal husbandry, while others select conservation or recreational applications. Solar farms maintain or improve soil health because they eliminate intensive tilling practices that cause soil depletion, which makes the land better than its original state before entering the lease.
Once their initial solar lease expires, many landowners decide to rent their land out for a new solar installation. The steady increase in renewable energy demand leads developers to extend existing agreements so landowners can generate passive income for more decades. Landowners who depend on solar lease income can renew their agreements to keep steady income without facing the uncertainties of agriculture or regular land leases.
Prospective solar lessees need to comprehend the process that happens after the lease ends to make an informed decision. Landowners find solar leasing appealing because it promises land restoration and preserves future land usage possibilities while providing low-risk financial stability over time.
To find out how a solar lease can benefit your property, you should talk to a solar developer who can assess your land's suitability and potential earnings.
How Can You Determine if Your Property Qualifies for a Solar Lease Agreement?
Signing a solar lease does not result in complete loss of property usage rights but requires thoughtful analysis of current and future land utilization plans.
Best Candidates for Solar Leasing
✔ Landowners with underutilized or fallow land.
✔ Properties that consist of large open fields, which remain out of agricultural production.
✔ Landowners who prefer passive revenue streams that require little management oversight.
✔ Landowners who wish to preserve their land from development but maintain ownership rights can consider solar leasing.
Who Might Think Twice?
Farmers who depend on growing row crops on their entire agricultural property should not consider solar leasing options.
Owners of small landholdings face challenges if solar panels would occupy most of their property space.
Landowners who use their property only for hunting or recreation reject the idea of fenced areas on their land.
It's beneficial to discuss your land goals with an experienced solar developer if solar leasing seems like an uncertain fit for your long-term plans.
Next Steps
Although you maintain land ownership through a solar lease arrangement, you will experience changes in how specific land sections operate. Landowners who choose to enter solar leasing agreements benefit financially through consistent income streams while maintaining their property rights.
When you want to know if solar energy can work on your land, moving forward is very straightforward.
Book a cost-free consultation to discover if solar leasing is suitable for your property.
