Empowering Farms, Ranches, and Rural Communities: The Promise of Agrivoltaics

In the race to meet renewable energy goals as demand rises across the United States, farm and ranch land is increasingly becoming a target for solar development. According to the American Farmland Trust’s (AFT) Farms Under Threat: 2040 analysis, there is potential that 83% of solar built by 2040 will be sited on farmland within the United States.¹

Without intervention, this landscape-scale change could have major impacts on the future of farming and food security in the U.S.

The emerging field of agrivoltaics – the intentional combination of solar energy generation and agricultural production on the same area of farmland – offers a promising solution that could help farmers and ranchers build long-term farm viability, reduce loss of farmland, and contribute to clean, affordable energy produced domestically in the United States.

As this is a complex and rapidly evolving field, there are currently a variety of definitions of agrivoltaics that are released or under development. To ensure benefits for farmers and long-term agricultural viability, AFT defines agrivoltaics as a “ground-mounted photovoltaic solar energy system that:

• Has been intentionally planned and designed with agricultural producers and/or experts, and
• Is constructed, installed, and operated to achieve integrated and simultaneous production of both solar energy and marketable agricultural products by an agricultural producer:
  
  – On land beneath and/or between rows of solar panels
  – As soon as agronomically feasible and optimal for the agricultural producer after the commercial solar operation date and continuing until decommissioning.”²

AFT’s definition emphasizes the importance of maintaining the “ag” in agrivoltaics, requiring that the solar project is designed and operated to enable the production of one or more agricultural products throughout the lifespan of the project. This farmer-centered approach ensures that the land under the solar array is actively used for agriculture, helping to mitigate the loss of farmland.

One notable benefit of agrivoltaics is that it provides farmers and ranchers with a diversified income, contributing to greater farm viability. Landowners can count on steady income from lease payments, in addition to marketing agricultural products (crops and livestock) grown or raised beneath the solar array.

Furthermore, access to farmland has been a challenge for tenant farmers, and agrivoltaics could create more opportunities for them to secure affordable land to grow their businesses.

A key factor driving the growth of agrivoltaics is vegetation management through solar grazing. Traditionally, diesel-powered mowers are used to maintain vegetation under an array. Utilizing sheep not only serves as an alternative to mechanical methods for managing vegetation but also provides additional grazing land, builds soil health, and can be more cost-effective for asset owners.

Both new and experienced graziers can offer their services to developers, helping to increase the U.S. sheep inventory.³

The shade provided by solar arrays offers shelter to sheep, cattle, and other livestock, protecting them from heat and various weather conditions. For crops, solar panels can also provide beneficial shade, which helps reduce a plant’s response to drought and heat stress while minimizing evaporation under the panels. This leads to improved soil moisture and lessens the need for irrigation.⁴

As a result, farmers can manage water more efficiently, conserving resources and minimizing the risk of nutrient runoff and leaching beneath the array.⁵ Additionally, there is ongoing research to assess how solar panels and design types affect the growth of different crop varieties and crop yields.

However, there are some considerations and challenges in pursuing an agrivoltaics project both by the developer and the farmer/rancher. Ground-mounted dual-use systems have additional costs associated with both the structural changes needed to accommodate farming and grazing as well as the additional costs for design and collaboration with stakeholders.

The National Renewable Energy Lab estimates that agrivoltaics systems have a premium of $0.07/Watt to $0.80/Watt in comparison to conventional ground-mounted systems.⁶ This can be expensive for both the farmer and developer.

Tomatoes growing under the array at the Rutgers Agricultural Research and Extension Center. © American Farmland Trust

Despite the potential benefits, successful implementation and widespread adoption of agrivoltaics will require funding mechanisms and policies that incentivize developers and support farmers.

Some states have already taken this initiative and developed programs and grants to help fund individual projects, provide property tax exemptions, create standardized siting and permitting for solar projects, and create compensation rate adders for dual-use projects.

Other states are just starting the process by creating statewide definitions for agrivoltaics, hopefully to build off of in the future.

Leading states in the agrivoltaics movement include Colorado, Massachusetts, Maryland, New Jersey, and New York, among others. Colorado state legislature passed Senate Bill 23-092 in 2023 to appropriate $500,000 for agrivoltaics grants to be used to “conduct a new or ongoing demonstration or research project as a means to study the potential, benefits, and tradeoffs of agrivoltaics in the state”.⁷

This funding was renewed again for the same amount in 2024, and then for $300,000 in 2025. American Farmland Trust was among the recipients in
2024 and helped produce a guide entitled “Funding Opportunities for Agrivoltaics in Colorado: A Guide for Producers, Landowners, and Service Providers” to help those pursuing agrivoltaics in Colorado.⁸

In addition to the grant program, Colorado has created a personal property tax exemption for machinery and equipment used in agrivoltaics to produce an agricultural product.⁹ This also includes the solar array equipment and machinery, benefiting both the farmer and the developer of a project.

Additionally, the code indicates that agricultural land will maintain its status as such when paired with a qualifying agrivoltaics array in
property tax assessments. Maryland has a similar tax regulation providing a personal property tax exemption related to agrivoltaics.¹⁰ Both of these tax exemptions could lead to lower property tax rates for developers or landowners.

Taking a different approach to incentives, Massachusetts was one of the first states to incentivize agrivoltaics by creating the Solar Massachusetts Renewable Target (SMART) Program. It includes a feed-in tariff which provides a premium price for surplus energy sold back to the grid for Agricultural Solar Tariff Generation Units (ASTGUs) established in 2018.

The state’s goal for the ASTGUs, or agrivoltaics systems that comply with the SMART program, is to generate 80 MW AC capacity for the state. Qualifying ASTGUs can receive an additional $0.06 per kWh adder in addition to the base compensation rate set forth by the program.¹¹

Several developers have taken advantage of this opportunity with more projects for the state in the pipeline.

Understanding that the initial development cost of projects can be inhibitive, both New Jersey and New York developed funding programs for projects. New Jersey’s stems from the Dual-Use Solar Energy Act of 2021 that created a 3-year pilot program at Rutgers University that will “lay the groundwork for a permanent
Dual-Use program.”

The program will create incentives specifically for dual-use solar utilizing their preexisting mechanism of Solar Renewable Energy Certificates IIs (SREC-IIs), which gives additional value to the energy produced by the system.¹² This would result in a higher bonus reward for participating in agrivoltaics. Last year, New York created a $5 million competitive solicitation through the New York State Energy Research and Development Authority (NYSERDA) to fund projects up to $750,000 that “[integrate] both new or retrofitted solar and farm operations such as those with cattle grazing, forage, or specialty crop production.”¹³

This solicitation was in collaboration with the New York Department of Agriculture and Markets with ongoing efforts to collect data on projects funded to inform other agrivoltaics projects in the state.

These are just some of the current, leading state-level actions in agrivoltaics. State-level action will be more important than ever to propel the field of agrivoltaics forward through policy and state-funded actions in light of the uncertainty surrounding federal funding.

These states will hopefully set an example for others to follow suit and recognize that agrivoltaics is a future worth incentivizing.

The future of agrivoltaics requires investment in thoughtful policy, collaborative research, and strategic partnerships that prioritize agricultural production and renewable energy.

Designing systems in coordination with farmers and ranchers, offering clear financial incentives, and replicating effective state-led programs on a national scale will be crucial for widespread adoption. By pursuing this approach, agrivoltaics can become the solution to strengthen rural economies, protect farmland, and help power the country sustainably.

About the Author
Catie Field, Smart Solar Program Coordinator, supports American Farmland Trust’s Smart Solar Program and its work nationally promoting farm viability, safeguarding soils and farmland, and uplifting agrivoltaics. She has an M.S. in Agricultural Science with a focus on animal science and livestock systems.

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