Could solar drive up cash rental rates for farmland?

Solar has become a growing part of the U.S. energy supply, and its use on farmland is a hot topic among producers and farm groups.

Some operations are being offered an average of $1,000 per acre, analysts worry it could drive up cash rental rates.

The Ag Economy Barometer surveyed 400 ag producers and found around 20 percent have been in active talks about leasing farmland to solar producers. 50 percent say rates were more than $1,000 per acre, 30 percent ranged between $1,000 and $1,250, and 28 percent were talking about rates at more than $1,200 per acre.

However, those solar panels take up space, and that can be problematic that the Department of Energy and Iowa State University are looking to solve.

“We’re funding Iowa State University to demonstrate and evaluate horticulture and beekeeping at a 1.35 Mw solar array on cap. Plus, they’re exploring how solar farms can be modified, for example by changing the height or tracking of the panels to accommodate agriculture. We believe there are opportunities to provide clean energy and increase farmer’s revenues while keeping farmland in production,” said Jeff Marootian.

Economists with Purdue are finding more farmers are concerned about finances lately, leading to them finding different ways to boost income.