Do Solar Farms Devalue Property?

Renewable energy is becoming increasingly popular these days, and one of the driving factors behind this is the cost-effectiveness and reliability of solar power. As more and more individuals, companies, and governments shift towards solar energy, the demand for solar farms is increasing rapidly. Have you ever thought of leasing your property for a solar farm or wondered how it would impact the value of your property? This resource will walk you through everything you need to know about the impact of solar farms on property values.

Key Takeaways:

• Common concerns about solar farms that often lead people to believe that they devalue property include the obvious changes to the landscape, fears about noise levels, and environmental and health misconceptions.

• Although some studies indicate a slight decrease in residential property values near solar farms, the overall effect is typically minimal and can be balanced out by other factors.

• Many studies report no significant impact on property values, and some even reveal positive effects on agricultural land or in specific areas.

Different Types of Solar Farms

A solar farm are large installations of solar panels built to generate electricity for sale to the power grid. These farms usually range from 1 to 5 megawatts in capacity, though some can be much larger, producing 50 megawatts or more. Unlike residential solar systems, solar farms are defined by their size and the fact that the electricity they produce is sold to wholesale utility buyers instead of individual consumers.

Solar farms come in various types, each designed for a specific purpose. The different types of solar farms are utility-scale, community, concentrated (CSP), and floating solar farms.

• Utility-Scale Solar Farms: These are large-scale solar project installations, usually over 1 megawatt (MW), that generate power for many homes or businesses. Their primary purpose is to feed electricity directly into the grid, and they often occupy large tracts of land.

• Community Solar Farms: These are smaller installations shared by multiple households within a community. Their main purpose is to facilitate access to solar power for those who may not have suitable conditions to install panels on their own properties.

• Concentrated Solar Power (CSP) Farms: These farms use mirrors to concentrate sunlight onto a small area, typically a receiver at the top of a tower. The concentrated light is then used to heat a fluid, which creates steam to drive a turbine and produce electricity. CSP farms are primarily used in regions with high solar irradiation.

• Floating Solar Farms: Floating solar farms are installed on bodies of water, such as reservoirs and lakes. They are designed to maximize land use efficiency and have the added advantage of reducing water evaporation and algae growth.

Each of these solar farm types plays a crucial role in the transition towards a more sustainable and resilient energy grid. As the demand for renewable energy grows, we can expect to see even more innovative and specialized solar farm designs in the future. For example, some companies are exploring the use of agrivoltaics, which involves combining solar panels with agriculture on the same piece of land.

In addition to their environmental benefits, solar farms also bring economic advantages to communities where they are installed. They create jobs during construction and operation, as well as provide a local source of clean energy. As technology advances and costs decrease, solar farms are becoming increasingly competitive with traditional fossil fuels.

Do Solar Farms Devalue Property?

Although some studies indicate a slight decrease in residential property values near solar farms, the overall effect is typically minimal and can be balanced out by other factors. Many studies report no significant impact on property values, and some even reveal positive effects on agricultural land or in specific areas. Research and case studies have provided a clearer picture of solar farms' actual effect on nearby real estate.

• Studies and Findings: Multiple studies, including those by university researchers and appraisal organizations, have shown little to no measurable negative impact on property values near solar farms. Some reports even note slight increases in value, as the presence of renewable energy infrastructure signals modernity and forward-thinking development in the area.

• Context Matters: The location, design, and management of a solar farm play a major role in how it influences property values. An installation designed with community input, including visual buffers and well-maintained landscaping, reduces perceived downsides and can integrate well into the local area.

Common Concerns About Solar Farms

Common concerns about solar farms that often lead people to believe that they devalue property include the obvious changes to the landscape, fears about noise levels, and environmental and health misconceptions.

1. Changes to the Scenic Landscape

A primary worry for many property owners is the shift from an open field or natural view to rows of photovoltaic panels. While solar panels bring a modern, industrial look, the visual impact of solar farms is often less intrusive than people anticipate. Developers typically plant vegetation buffers around the installation to screen views from neighboring properties, reducing the perceived aesthetic disruption.

2. Fears About Noise Levels

Solar farms rely on technology to convert sunlight into electricity, leading to concerns about noise affecting neighboring homes. The truth is that solar farms are some of the quietest energy-producing facilities. They lack the moving parts and heavy machinery you’d associate with other power sources, such as wind turbines or power plants. Most noise in a solar farm comes from inverters, which convert solar energy into usable electricity. These inverters emit a gentle hum under peak sunlight, but from even a short distance away, the sound becomes negligible and unlikely to disrupt anyone’s daily life.

3. Environmental and Health Misconceptions

There is also skepticism about whether solar farms might harm the local environment or even pose health risks. These fears are largely unfounded. Solar farms use materials designed to safely and effectively harness solar energy, which has minimal environmental disruption compared to other forms of power production. Far from harming the environment, solar farms often improve it. Developers frequently implement land management plans that include planting native grasses and flowers to create pollinator habitats, which boost biodiversity and restore soil quality.

Solar Farm Leasing and Payments

Having a solar farm on your property increases its value significantly. When you invest your property for solar farm development, you're not just investing in a continuous income stream. Having a guaranteed source of income for 20-30 years is attractive to most real estate professionals, and this added value can ultimately increase the property's overall value. Renewable energy industries are growing at an incredible rate, and it's important to note that as the demand for clean energy continues to rise, the value of the associated assets - such as solar farms - will more than likely follow suit.

Leasing your land as a solar farm to an energy developer can be an extra stream of revenue for landowners. Rather than just having idle land, leasing it for a renewable energy project can generate significant profits for the landowner. Not only will it help in diversifying the landowner's income stream, but it will also facilitate renewable energy production - something that is the need of the hour considering the alarming levels of greenhouse gas emissions. Furthermore, leasing the land to an energy developer can also allow landowners to become more involved in the renewable energy industry.

Assessing the Value of Your Property for Solar Energy

The land qualifications for solar leases include easy access to energy grid infrastructure and 40+ buildable acres.

Easy Access to Power Supply

Being close to transmission lines and substations is just as critical. If transmission lines and substations are near your property, there's a higher chance that energy developers will be interested in your land. 

It's cheaper for energy developers to connect to existing infrastructure rather than develop new lines and substations. In addition, the closer your property is to these utilities, the more efficient the energy transfer will be, which also translates to higher returns for energy developers and landowners alike. 

Higher Property Value With Low Exclusion Zones

Property owners that don't have exclusion zones present on their land have a high chance of receiving offers for their property for solar development. These exclusion zones include:

• Topography - solar farms need to be built on flat land since it is a cluster of solar panels together spanning a large area. Certain topography percentages are manageable for energy developers but the more hilly, the less likely it is for a project to be offered.

• Water - if the property is located in a flood zone, a wetland, or has waterways nearby that could cause potential flooding, that lessens the likelihood of a solar lease. Even though there are floating solar farms, a solar farm that is going to be built on land will need a sturdy base. This will ensure that the solar panels are safe for a long period.

LandApp makes it easy for property owners to understand their property’s potential for solar farm development. LandApp’s free Property Report outlines the estimated solar lease payments, the types of exclusion zones that are present on the property, and more! Find your parcel on our map to create your free report. If you're interested in monetizing your land through a solar lease after getting your free Property Report, you can list your land for lease completely free on LandApp's nationwide marketplace to start exploring offers:

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