Wind and Solar Offer Diversified Revenue for U.S. Farmers and Ranchers

Legitimate, secure income opportunities are growing

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Food and fiber aren’t the only commodities U.S. farmers and ranchers will bring to market in the next decade. Look for solar and wind ventures to generate additional income for agricultural producers and rural landowners. Both renewable energy sources are gaining ground as state and federal policies pursue aggressive climate change goals and a greener power grid.
 

In fact, solar energy has the potential to power 40% of the nation’s electricity by 2035, the U.S. Department of Energy reported in September 2021. The DOE also called solar “our cheapest and fastest-growing source of clean energy.” It’s no surprise, then, that interest in developing solar farms is skyrocketing in states with abundant sunshine, significant agricultural land, mandates for renewable energy, and incentives for renewable development.

Onshore wind energy in the U.S. grew at a record pace in 2020, the DOE’s Office of Energy Efficiency and Renewable Energy said. Wind provides more than 10% of electricity in 16 states, and over 30% in Iowa, Kansas, Oklahoma, South Dakota and North Dakota.

Both renewable energy sources are gaining ground as state and federal policies pursue aggressive climate-change goals and a greener power grid.

Farmers and ranchers are well-positioned to play a major role in commercial solar and wind expansion largely because they already own a key component: land that can be leased for generating renewable energy. Putting rural properties to non-crop use allows ag producers to diversify their operations and leverage their land base. Maybe that section corner or unused ground – anywhere from 4 to 2,000 acres – can host a solar project. Perhaps those rolling hilltops are the ideal spot for turbine-topped wind towers.

The additional income from wind and solar leases can bolster an industry that often struggles with insufficient and inconsistent commodity prices. It can allow farmers and ranchers to liquidate debt. It yields money that is invested in equipment, technology, land expansion, or other needs, including buying out a family member or business partner.

Moreover, wind and solar leases typically work under contracts of 30 years or more, offering long-term income spanning multiple generations. And such projects appeal to the technology-loving next generation. Wind and solar projects offer farmers and ranchers much-needed revenue diversification, just as mineral rights, biofuel production, and habitat preservation ventures do. But these fast-growing renewable-energy opportunities also pose challenges for the ag community.

Click here to contact a KCoe land and renewable energy strategist to discuss secure and legitimate options for your land.

 

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Robert Veldman

Robert Veldman

Land Consultant