Press Release
College Park, Maryland (May 18, 2016): Landowners with properties in Kent, Cecil, and Queen Anne’s counties who have been approached to lease their land to solar and wind energy companies are invited to attend a four-hour workshop June 7, 2016, at Washington College. Three faculty members from the Department of Agricultural and Resource Economics, University of Maryland will address the advantages and disadvantages of using their private properties for energy development.
New goals set in Maryland to convert two percent of the state’s power to solar by 2020 has spurred a strong interest on the part of energy companies to reach out to local landowners and encourage them to lease their land as commercial solar farms. This move to develop more energy efficiency throughout the state has raised important concerns in local communities, specifically economic and legal, about the advantages and disadvantages of complying with this state-mandated request.
To help landowners unfamiliar with energy leases make the best possible decision when approached by energy companies, Dr. Sébastien Houde, Extension Energy Economist, Department of Agricultural and Resource Economics, will discuss the economic issues, and Ashley Ellixson and Paul Goeringer, Extension Legal Specialists, Department of Agricultural and Resource Economics, will discuss the legal issues.
Paul Goeringer, who has done his share of outreach on leasing farmland in the state, believes the new leases for energy farms will be long and complicated for anyone unfamiliar with them. “Landowners before preparing such leases will need to consider how they plan to use the land in the future and if solar panels will be compatible with any future plans for the property,” Goeringer said.
The advantage to leasing the land to energy companies, he went on to say, will be their potential for creating new revenue streams during periods of low commodity prices. The disadvantage will be the long-term contracts landowners will be expected to sign and the restrictions such contracts will have on the land. For this reason, he believes it is very important to understand how this will all mesh with any future plans the landowners may have for the land before agreeing to negotiate with energy companies.
Economist Houde will discuss the economic issues that may be contained in the lease. He will differentiate between what it means to be paid based on energy produced, and what it means to be paid based on other factors? When considering such leases, he recommends that landowners should carefully review any tax credits and other incentives, federal and state, that may be offered for participating in this program.
The workshop is being sponsored by the Department of Agricultural and Resource Economics, University of Maryland Extension, the Agriculture Law Education Initiative, and Washington College’s Center for Environment & Society. It will be held Tuesday, June 7, 2016, from 4:30 p.m. to 8:30 p.m. at Washington College, Hynson Lounge, Hodson Hall, 300 Washington Avenue, Chestertown, MD 21620.
Those interested in attending the free workshop should register at: http://go.umd.edu/SolarWorkshop.