Why Should you convert your land to solar?

Converting your land to solar can be an excellent method to increase the productivity of your property. Solar leases often pay several thousand dollars an acre in lease rates

The dramatic increase in the cost of living, skyrocketing interest rates, price jumps of fertilizers and fuel, and instability in the real estate market have called into question the business-as-usual approach to farming and use of agricultural land. Now more than ever it is vital to have a diversified cash flow and a guaranteed source of reliable income. Allocating a portion of your property to commercial PV solar energy production is an excellent way to accomplish these goals. Solar leases are stable, long term guaranteed income that not only put money in your pocket, but also provide local power and support the domestic and local economy with high paying jobs. Some leases can be modified to increase along with an increase in power prices, creating a hedge for living expenses and farming input costs.

We live in uncertain times. Small farm bankruptcy rates have skyrocketed in recent years, driven by instability in commodities pricing. With ever shifting market conditions, having a stable source of reliable income can make the difference between solvency and losing the family homestead, in a few cases even allowing for an early retirement. This reliability can be accomplished by leasing a portion of your land for the development of PV solar power production. The primary benefit of a solar lease is its term, often 20 years or more in length and the income is guaranteed and often inflation adjusted for that period of time. This long term guaranteed income eliminates some of the issues that can arise from market volatility around crop pricing, giving you peace of mind for the future.

One often hears about “diversifying your portfolio” regarding investments, but landowners should also consider this approach when it comes to sources of income and land use.

Depending on location, a solar lease can pay upwards of $1,000/acre/year. For a 100-acre site, this could mean over $100,000 annually. Being able to hang your hat on guaranteed income of that amount takes a huge amount of stress away and, vitally, diversifies cashflows. This can help your farm weather any storm.

Dedicating some, or a significant portion, of your land to PV solar energy production has a unique benefit. You no longer have to work that land. This allows you to focus on other aspects of your business or life. As an aside, having a power generating asset on your property can increase its value.

Finally, when the lease runs out, your land will be restored to its former appearance, securing its beauty for future generations of your family.

With all of the above being said, how do you know what is a good price/acre? Maximum Lease can help. With our network of verified energy developers, we will connect you with the best offer and advocate for your success when dealing with lease terms and determining fair price for your land, while giving the solar developer a lease that is bankable and commercially viable.

Commercial and utility scale solar leases are a low-risk way of diversifying your cash generating assets. Consistent and predictable cashflow will take the stress out of a large portion of your life and at the end of the lease the land is returned to its original state.