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Changes in USDA policy could impact the future of solar energy expansion

Ag Secretary Brooke Rollins recently announced that the USDA would no longer provide funding through the Rural Development Business and the Industry Guaranteed Loan Program for solar or wind to be installed on productive farmland.

David Widmar with Agricultural Economic Insights says he’s concerned this new change could impact the future of solar energy production.

“There are some projects that are more local in focus,” he says. “There are some projects that are larger in scale or more regional in focus. This probably has more effect on those smaller scale projects.”

He tells Brownfield in a down ag economy; solar can provide farmers with an additional revenue stream.

“For those who own the land that are able to get a solar lease, those are really high payments,” he says. “Much higher than you might expect for a traditional crop lease, so that can be some income for those producers or landowners. That’s where the demand for solar is really creating a lot of value.”

Widmar says a new report from AEI found that there has been rapid solar energy expansion in the U.S. since 2020. He says as energy demand increases, it will likely create friction in the ag economy.

“You start to see these tensions between farmland owners, who have these opportunities, and those in the community who are trying to rent that land,” he says. “Moving forward in the farm economy, this broad category of non-ag demand for agricultural resources will likely be a continued theme.”

The USDA says the move is part of the department’s plan to protect American farmland and reduce taxpayer support on green energy projects.

AUDIO: David Widmar, Agricultural Economic Insights