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Different Resource Leasing Options That Landowners Have

Updated: Jan 8


Illustration of solar panels, batteries, and a wind turbine in the background


Landowners have a variety of options when it comes to leasing out the resources on their land. Leasing land for solar, wind, carbon, water, minerals, mining, battery storage, or EV charging can provide property owners with an opportunity to make money from their land without having to sell any acreage. Here’s a brief overview of some of the options available:


Solar Leasing

Landowners can lease their land to solar energy companies for the installation of solar panels. The lease agreement may involve a flat rate or a percentage of the energy produced by the panels. This can provide landowners with a steady income stream and help them contribute to the growth of renewable energy. Typical Amount of Acreage Required:

  1. Commercial solar projects usually require 40+ acres of buildable land. Meaning, at a minimum, they will be able to construct at least 40 acres of solar panels. Many commercial solar projects can be very large and require several thousand acres of land to be built.

  2. Community solar projects can be as small as 5 acres. These projects do not produce nearly as much energy as a commercial facility. Community solar facilities usually provide power to nearby communities or businesses. These do not require being close to large transmission lines or substations to function.


Typical Span of Leasing Contract:

  1. Solar energy leases have two main phases: option and development/production phase.

  2. The option phase typically lasts 2-5 years depending on size and scope of a project. The faster a developer would like to get their project online - the shorter a term. The landowner will get paid a small portion of the agreed upon “lease” during this period. The developer will not actually be obstructing the property during this time.

  3. During this phase, the landowner can continue whatever agricultural or recreational practices they have traditionally been doing on the property. The developer uses this time to submit applications for the viability and approval of the project. This includes permits, interconnection queue, purchase power agreements, environmental studies, regulatory and administrative tasks, etc.

  4. The development/operation phase typically lasts anywhere from 25-50 years and can include several “options” to be extended. Meaning that if the developer chooses to extend the life of the project, they can choose to do so. But are not required to.

  5. The operation phase is where the landowner gets paid the agreed upon “lease” rate. This can be based on a dollar per acre per year rate, percentage of the energy production, or a combination of the two. Production or royalty payments are more common in wind leases and rarely if ever seen in solar leases.Solar Lease Payments:

  6. There are quite a few ways that landowners can get paid to lease their land for a solar farm, and solar lease contracts vary across the country. Solar lease payment terms are negotiable, but landowners are usually paid between $400-2,000 per acre, per year.

Wind Leasing

Similarly, farmers and landowners can lease their land to wind energy companies for the installation of wind turbines. This lease agreement may involve a flat rate or a percentage of the energy produced by the turbines. Wind leasing can be a good option for landowners who have large, open spaces, and are interested in sustainable energy. Typical Amount of Acreage Required:

  1. Commercial wind turbines can be erected on parcels as small as 10 acres. However, wind developers tend to target large tracts of land since entire wind farms can, and often do exceed hundreds of thousands of acres.Typical Span of Leasing Contract:

  2. 2-10 year option period, with a 30-50 year development/operation phase. Some wind lease extension options may include “re-powering” options. This is where the developer can maintain the right to upgrade an existing turbine to allow for more efficient or larger blades/hubs to be installed. Additionally, most wind lease contracts contain 'option to extend' provisions that give the developer the option to extend the lease by 5 or 10 year increments.Wind Lease Payments:

  3. There are quite a few ways that landowners can be paid when they lease their land for a wind farm, and wind lease contracts vary across the country. Wind turbine lease payment terms are negotiable. Landowners can be paid per acre, per turbine, and/ or with royalties.


Carbon Leasing

Carbon leasing involves selling the carbon credits generated from your land based on the amount of carbon it is removing from the atmosphere. Companies or organizations can purchase these credits to offset their own carbon emissions. This can be a good option for landowners who want to contribute to the fight against climate change, and for those who are not interested in making major changes to their land. Typical Amount of Acreage Required:

  1. Carbon credits can be established on all ranges of parcel sizes. Currently, carbon developers are looking for larger tracts (over 100 acres) of forestland, and over several hundred acres of grassland/farmland. Forestland is generally more valuable for carbon credits due to the fact that trees sequester more carbon than any other type of plant or vegetation.


Typical Span of Leasing Contract:

  1. Carbon contracts vary depending on the carbon developer and the type of carbon credit. Timber carbon credit contracts can be as short as 12 months, while agriculture-based carbon credit programs tend to be much longer and range from 5-100 years.


Water Rights

Landowners with access to water resources can lease those resources to companies or organizations that need them for their operations. This can include leasing water rights for irrigation or for use in manufacturing processes. Water leasing can be a way for landowners to generate income from resources that they may not have a use for themselves. Typical Amount of Water Required:

  1. The amount of water that you can trade is heavily dependent on the location and regulations on the resource. As with most resources, larger the amount that you have, the more interest in your listing you'll receive.

Typical Timeframe Required:

  1. Water can be leased on a seasonal or long-term basis depending on the regulatory environment in your specific area.


Oil & Gas Mineral Leasing

Landowners can lease their minerals to mining and exploration companies for the extraction of minerals such as coal, oil, and gas. Mineral leasing can provide significant income in areas where these valuable resources exist in abundance. The United States is the only country in the world that allows private citizens to own minerals. Mineral ownership can, and often does, differ from surface ownership. Meaning that just because someone owns the surface, doesn’t mean they own the minerals, and vice versa. Typical Amount of Acreage Required:

  1. Minerals down to fractions of an acre can be leased.


Typical Span of Lease Contract:

  1. Most oil and gas leases are paid upfront with a primary term of 3-5 years. This commonly includes a 2 year extension as well. That means that an exploration company has 3-5 years to drill for and produce an oil and gas well, or the lease expires. The lease can be held in perpetuity as long as the production continues based on the terms of the lease.


Mineral / Mining Leasing

Landowners can lease their minerals to mining companies to explore for important minerals such as gold, silver, copper, coal, uranium, sand/gravel, and others. Landowners must own mineral rights to take advantage of leasing their property for mineral exploration. The United States is the only country in the world that allows private citizens to own minerals. Mineral ownership can, and often does, differ from surface ownership. Meaning that, just because someone owns the surface, doesn’t mean they own the minerals, and vice versa. Mineral exploration can involve subsurface and surface extraction where the mineral and surface owner will need to be common. Typical Amount of Acreage Required:

  1. Minerals down to fractions of an acre can be leased. Precious mineral leases are common down to a few acres while less valuable minerals such as sand/gravel require larger amounts for economic purposes


Typical Span of Lease Contract:

  1. Mineral lease length is typically determined by a presumed amount of resources to be extracted. Lease terms can be in 5 or 10 year phases with the option for the developer to renew at the end of each phase.


EV Charging and Battery Storage Leasing

Landowners can lease their property for the installation of electric vehicle charging stations and battery storage facilities. This can be a good option for landowners who are interested in sustainable energy and want to contribute to the growth of the electric vehicle industry. Any site that has nearby access to transmission/distribution and a substation may be good for battery storage, while the same criteria in addition to major highway or road access can be ideal for EV charging. Typical Amount of Acreage Required:

  1. EV charging can be placed on as small as ½ an acre, while battery storage tends to be on parcels with at least 2+ buildable acres. Large battery storage sites can lease parcels up 40 acres in some instances.


  1. Typical Span of Lease Contract:

  2. EV charging and battery storage leases are typically 20-30 years with options to extend and/or allow periodic facility upgrades.

Overall, the leasing options available to landowners depend on the resources that they have available. It's important for landowners to carefully consider all of their options in order to make the best decision for their land.


If you are interested in learning the value of your land’s resources, find your parcel on our map to get your free Property Report and lease estimates!


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