Getting Paid For Solar Lease On Your Land
How will I get paid for leasing my land for solar panels?
There are quite a few ways to be paid when you lease out the solar rights on your land. Across the country, deal terms vary. But generally, for Utility Scale Solar Farms, the developer will pay you $10 – $40 per acre per year for a 2-6 year option to lease. If during the option period, the developer elects to exercise the option to enter into a formal lease, you will be paid between $300 – $1000 per acre per year for 25 – 30 years.
Learn more about solar lease payment structures.
What is a solar lease option?
A solar lease option does not mean you are guaranteed to have a solar farm on your land. Solar developers use a solar lease option to ensure that they will have the exclusive right to enter into a formal solar farm land lease agreement before they invest time and money into their evaluation period.
What is a fixed annual payment in a solar lease agreement?
A fixed annual payment for a solar lease is a pre-negotiated amount of money you will be paid annually to lease your solar rights. The number of years is also pre-negotiated and usually 25-30 years, with an option to extend the lease for another 5 years.
What is a Power Purchase Agreement?
A Power Purchase Agreement is an agreement between the solar farm developer and a company wanting to purchase the electricity. The solar developer will need this agreement in place prior to making the large investment to build the solar farm on your land.
As electricity prices increase overtime, am I compensated in my solar lease contract?
In a fixed annual rent payment lease, the landowner will not benefit from higher future electricity prices. As an alternative, most solar farm lease agreements provide for an annual escalator of 1.5 – 3%. Another benefit to the fixed annual rental payments is that the rental payment does not decrease if electricity prices go down.
Will I have to pay property taxes if my property is developed as a solar farm?
You will be responsible for property taxes on the portion of your property that is not developed for a solar farm. The solar farm lease agreement generally provides that the developer will be responsible for the taxes assessed on the developed lands.
Can I sell my solar royalty payments?
Landowners receiving payments from solar farm developers can market and sell those future payments. Property owners can market the payments they receive from a solar lease with LandGate. Find your parcel on our map and follow the process to create a listing.
Learn more about selling your solar royalties.
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