Solar companies looking to lease land in texas

Making Money from my Land or Roof: How Much Will Energy Developers pay to lease?

This depends on a number of factors.

Amount of land or roof

If you have a suburban house, leasing your roof for a residential solar project (1 – 4 KW) could yield several hundred dollars per year with no costs to you as the roof owner.

If you own a large plot of land or a large industrial roof (more than 1 hectare), annual lease payments could be anywhere from $250 - $2000 per acre in the US, and €500 to €5000 per hectare in Europe. Very large projects (>100 MW) tend to be in remote areas where land is cheap, such as in Texas where annual lease rates are $400 - $600 / acre. Medium projects (~5 MW) such as incentivized community solar projects in New York State have annual lease rates of $1000 - $1500 / acre.

In general, leasing land for a solar project yields higher value than most types of agriculture, and predictable, fixed revenue streams that are guaranteed for many decades and don’t fluctuate with agricultural commodity prices.

Available solar resource

The sunnier your plot is, the more your plot is worth to a solar developer (look up the solar irradiation of your plot here). That said, solar energy has come far enough that even if you live in a cloudy place, solar could still be a great option if the regulatory environment is right. This is certainly the case for the Northeast of the United States, Germany, the Netherlands and the UK. The surprising result is that solar projects are often more attractive in cloudy places with favorable legislation, than they are in sunny places that don’t favor solar (e.g., Middle Eastern countries with cheap, subsidized fossil fuel based energy).

Aside from the local climate, you should consider the impact of shading on your plot. If there are buildings, trees or other objects adjacent to your plot, these could possibly cast shade on your plot, reducing the available solar energy. If objects are on the north side of your plot, their impact on shading will be minimal, since the sun is in the southern part of the sky (the opposite is true if you live in the southern hemisphere). The NOAA solar position calculator can show you the position of the sun at your location at different times of the year.

Proximity to grid infrastructure

Residential rooftop solar projects can connect to your home’s existing grid connection, so access to the grid is not an issue. If you own a plot of land in a suburban or industrial area, you can be confident that grid connection infrastructure exists near you.

For larger solar projects in more remote areas, the cost of the grid connection is often the factor that determines the economic viability of the project. If there is a transmission or distribution line near you, this is a huge advantage. Ideally, the power line’s voltage should match the project size. For example, a 3 MW distributed energy solar farm would connect at medium voltage (33 kV) while a 300 MW utility scale solar project would connect at high voltage (230 kV). A high voltage power line in the vicinity of the 3 MW project would not be useful, since interconnection costs would be too high. Another important factor is injection capacity, since the grid could be congested at the point where a project seeks to connect.

Land features, soil type / roof structure

Both topography and ground type matter. If your land is rocky or swampy, it will be more expensive to build support structures for solar panels. If your land is covered in vegetation or other objects, costs for a solar project could increase if obstacles need to be removed. Hilly land can normally be used, but may have disadvantages related to shading. Even lakes or other water surfaces can be used for floating solar projects.

If you own a roof, the angle of your roof will make a difference, since a south facing roof will catch the most sun (in the northern hemisphere). Most rooves can support solar panels, but older or weaker structures may need to be reinforced.

Regulatory environment

Almost any plot can be turned into a solar project if there are sufficient incentives in place. The cloudy Netherlands still have a feed-in tariff, fostering a boom in solar development with double digit growth from 2013 to 2021. Many sunnier places remain far behind in solar. Renewable Portfolio Standards adopted by many US states, or other policies such as direct transfers or preferential tax treatment are common around the world, and often play a big role in renewable energy projects. Renewable energy subsidies are only a fraction of fossil fuel subsidies, but have a strong impact at around $166 billion per year (globally).

Market related factors

Just as real estate prices depend on market movements and the local and national economy, lease rates for land will also fluctuate based on these factors. If an area attracts the interest of energy developers due to attractive local regulations (e.g., flexibility on rezoning or tax breaks), then lease rates will go up. Conversely, if you wait too long and many projects have already been built, the grid could have become congested, rendering solar projects less attractive.

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