Solar farms or farms with solar panels on their infrastructure have become increasingly popular throughout Europe, with farmers in the Netherlands even receiving hefty grants to install them.
So far in Ireland over 27,000 acres of land has been committed for use in solar energy production, though none are in operation thus far.This year to date, there has been a high number of planning applications, 221, to develop solar farms. In total only eight of which have been refused, with a majority of applications coming from the South.
But would it be worth it to do it in Ireland?
One of the main concerns:
One of the main problems connected with building solar farms on farmland, was the problems for Capital Gains Tax and Capital Acquisitions Tax when leasing land out to solar energy providers. Land used for solar production was previously made ineligible for Retirement or Agricultural relief. This has been rectified in the Finance bill, with the definition of assets now including land leased to solar energy providers.
Up until these changes land leased for solar energy was not classified as agricultural property, with land with less than 50% covered with panels now remaining in the agricultural property class.
What is it worth/Is it worth it?:
Typical contacts with companies usually last from 25 to 30 years. These are usually binding agreements, though just for the developer. This gives them a two to five-year window to decide whether to proceed with the development or not.
These are legally binding agreements and are normally for between two to five years giving the developer exclusive rights to proceed with a solar farm or not.
The going rate for farmers is usually around €1,000 per acre per year. There could be tax implications involved for farmers though and anyone considering making the move should obtain legal advice prior. This is because the additional income must be declared.
Technically should you complete your full lease agreement with a developer, then a solar farm on a minimum of 25 acres would be worth at least €25,000 per year to farmers. This is significantly higher than the €22,800 average wage received by Irish farmers. Could this be a way to earn more money, without the hard work?
Have you thought of putting panels on your house too? If so there is also grants available. Through the Sustainable Energy Authority of Ireland, SEAI, a solar grant of €1,250 is available, this includes a €50 BER grant. Anyone who avails will also get a €100 carbon credit discount from their quote. Any grants and carbon credits are deducted from your invoice.
These grants are only available to houses which were built prior to 2006, while any application will be invalid if it is found that a grant was received from the Greener homes scheme in the past. Grants are only available to households that were built before 2006. Approval for a grant must be achieved before installation. See here for more information.