Our Views: Solar project warrants caution
A proposal to install solar arrays on nearly 1,400 acres in Walworth County should prompt local and state officials to begin assessing the long-term implications of converting large tracts of farmland to energy production.
These projects could become more prevalent as the cost of solar continues to fall, potentially allowing for the technology’s widespread adoption. Public policy should be crafted in anticipation of solar ubiquity, not in reaction to it.
We just want to be sure communities and landowners fully understand all the risks and potential downsides to entering decades-long agreements to swap crops for solar panels.
A Chicago-based company’s proposal to generate 200 megawatts of electricity on leased land is intriguing. The company, Invenergy, plans to offer 25-year agreements to install and operate solar panels, giving farmers the chance to diversify their income. With corn and soybean prices at depressed levels and many farmers struggling to break even, Invenergy’s proposition has significant appeal.
Placing solar arrays on farmland would also seem to have minimal effect on the land, allowing it to someday return to crop production. The arrays would likely be less intrusive than wind turbines, which make noise, cast flickering shadows and endanger some birds.
But these massive solar fields in rural areas are so new to Wisconsin that local officials and landowners cannot afford to overlook the fine print of any agreement. The solar industry is evolving quickly, and it’s near-impossible to say what it will look like in 15 years, let alone 25 years when the leases expire.
The energy market could undergo upheaval as technological leaps render obsolete innovations only a few years old. Disruptions to the energy industry, whether related to production or distribution, could quickly turn today’s energy winners into tomorrow’s losers.
Invenergy has made clear its offer to Walworth County landowners is voluntary, and it’s good to know farmers aren’t be pressured to enter a deal.
“It’s truly up to the community, the landowner, if they want to diversify their income,” said Neil Palmer, Invenergy project consultant. “Not everybody will participate. That’s just the fact of the matter.”
Along with assessing the tax implications and possible insurance requirements, landowners should ensure any agreement includes provisions for decommissioning the arrays should the company fail for whatever reason and/or landowners stop receiving lease payments. If the project were to fail, landowners need the ability to quickly return their farmland to crop production.
Every business venture involves risks, but that doesn’t mean the landowner leasing land should bear the brunt of it. If more and more land is to be converted to energy production, local communities should seek deals that give them the best possible treatment should a project’s economics sour.
Solar energy’s potential economic and environmental benefits are no secret, and communities are justified in wanting to produce energy more cleanly and efficiently. Invenergy’s project would dwarf anything like it in the region, and it could serve well landowners and energy consumers for many years to come.
At the same time, landowners and local officials cannot afford to be naive about possible consequences. Due diligence on their part today could save them from regret down the line.