By Ajulo E. Othow, Esq., Founder & CEO, EnerWealth Solutions, LLC
As the CEO of a company that develops solar and energy storage projects, I know from experience that solar energy is becoming less and less of a mystery and more of an opportunity for all. This includes landowners trying to make the best business decision for what may be their most important asset – their land. Many landowners are discovering that solar energy presents them with a viable and lucrative business opportunity to generate revenue today and to preserve their land for future generations.
The opportunity may be particularly timely for woodland owners in the northeastern North Carolina region served by the Sustainable Forestry and Land Retention Project. This is a portion of the state where African-American landowners, in particular, have suffered large amounts of land loss over the past century due to heirs property conflicts, discriminatory treatment by lending authorities and other reasons. Solar energy has the potential to be a game-changing income stream that can make the difference between retaining or forfeiting land that’s on the economic bubble. Solar projects also hold potential for smaller tracts of land that aren’t being put to profitable use for forestry or farming.
There are two general ways that landowners can both generate revenue and retain their land for future generations using solar energy.
- The first is to lease your land to a solar developer/owner or operator for a term of years. Often referred to as utility-scale solar or a solar farm, these types of projects are prevalent in eastern North Carolina. Typically lease rates are not less than $500/acre per year, and the lease term is not less than 20 years (more often 35-40 years). The amount of acreage required varies greatly depending on the type of solar installation. In most cases, a solar array will require at least 30 acres. However, there are installations that may require as few as five acres and other cases where a minimum of 80 acres is required. Besides the size requirement, there are also site conditions and interconnection considerations for a solar energy installation. Cleared land is more attractive than wooded areas, as is relatively flat land with good soil conditions that is not prone to flooding. Sites evaluated for suitability also include those with the greatest exposure to sunlight from the south. Because so much solar has been built in eastern North Carolina, many of the “best” sites have already been identified and built. This makes suitable sites remaining within the region premium locations, which can be a positive negotiating point for landowners.
2) The second way a landowner can potentially improve the bottom line is by reducing operating expenditures. If you’re operating a greenhouse, running cold-storage facilities or have other high-cost electrical equipment, offsetting those costs by generating your own electricity may be an option. While equipment loans are available to install a solar array, the most cost-effective means of installing is to pay upfront to avoid potentially expensive interest rates and fees. A 25-kilowatt system, for example, could cost approximately $45,000, with annual savings on an electric bill potentially resulting in payback in under seven years.
While there are many factors to consider, I believe that for many landowners, solar will become more and more of a solid business opportunity than it already is.
Ajulo E. Othow is an attorney and Founder and CEO of EnerWealth Solutions, a developer of solar and storage projects based in North Carolina. EnerWealth’s projects focus on delivering renewable energy and layered community benefits including land retention and economic opportunity for rural families. www.enerwealthsol.com