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A solar company's 'pitch' letter to a farmland owner. (Farm Journal) |
U.S. farmland is predicted to decrease in value by 2025, but solar energy leases may change that. "In Illinois, farmers are reporting eye-popping offers that are well above $1,500. One farmer near Morton, Ill., shared with U.S. Farm Report some information regarding an offer he received via an unsolicited letter," Morgan writes. "The company offered him a rate of $3,200 to $4,500 per acre. The company offered an additional $1,000 if the farmer signed a letter of intent, plus $3,000 more upon signing the cash lease."
Most sources say that current solar energy leases range from $500 to $4,000 per acre, which even with a 50-acre lease, is a chunk of money; however, the length of those leases may cause some family farmers to balk. Janzen told Morgan, "Farmers are used to one-, two-, maybe five-year cash rent leases, and these are for 20, 30 or even 40 years. So, they're really a generational decision that needs to be made.”
Despite potential monetary gains, solar contracts come with risks. Jazen told Morgan, “I think there's some risk on a personal level. These are becoming somewhat controversial at the county level. And so it can divide neighbors and counties, which is unfortunate, but it's also a reality.”
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