Energy Farms

It shouldn't come as a surprise that we're talking about how to start a solar energy farm. It combines some real assets, infrastructure, renewable energy, and a steady stream of reliable cash flow. United States is known for its abundant supply of sunshine. Experts around the country have tons of data supporting the idea energy farms have become a solid investment with long-terms profits. Families and businesses are seeing many homes in residential areas go from having large power bills in excess of over $300 to $1000 or more per billing cycle to earning money from the power from the sun and wind.

What Is a Solar Energy farm? The need for renewable and clean energy systems around the world has made solar power one of the most preferred by both investors and users. There's an increasing demand for solar power, and so, the concept of energy farms has become increasingly viable. Now, what is a energy farm? This concept isn't new. However, for those that don't know, it is simply a photovoltaic power station. Solar panels and equipment are installed in a large expanse of land (usually several acres) for the sole purpose of power generation. This is then sold to the electricity grid or actual end-users.


Solar farms are sprouting up all over America. The 30% Federal energy tax credit, combined with state, utility and local solar incentives have created an extremely favorable climate for investment in solar farm technology.

Solar farms can take many forms. The most common is the PV or photovoltaic solar farm that is built from hundreds or thousands of solar panels mounted on large racks in a field, pasture or desert parcel. Want to discuss a solar farm? Speak now with an installer - 888-844-0811

Solar Farm Installers - planting the seeds of power

Installation of solar panels on the scale required for a solar farm is a big task. But like most engineering projects, the installation of a solar farm is made simpler by breaking down the project into its component parts.

Solar farm types:

  • Photovoltaic (Solar electric)
  • Thermal (Solar hot water - steam)

Site assessment:
  • What is the earth composed of? What is underneath?
  • Is water available to clean the solar arrays/mirrors?
  • Are there any zoning issues?
  • How close are existing power lines and substations?

  • National lenders (USDA, EPA, SBA)
  • Public/private partnerships
  • Private investors
  • Power companies

Leasing o Incentives
  • 1. Available from Federal and State government and local utilities
  • 1. Energy tax credits, rebates, grants, feed-in tariffs
  • 2. RECs (renewable energy credits)

Solar Farms: Photovoltaic PV vs Solar Thermal

Solar Thermal

Most early solar farms (and a number of very large-scale current solar farms) were built using solar thermal technology. Thermal solar farms use a series of mirrors to concentrate the sun's heat onto a central column that uses the high temperature to create steam, which then spins a turbine to make electricity (interestingly, it's the same turbine technology used in hydroelectric, nuclear, geothermal and coal burning plants that generate electricity.)

Photovoltaic (PV)

Photovoltaic solar farms use hundreds or thousands of panels covered with photovoltaic cells to convert the sun's light directly into electricity. They generate more power when daylight lasts longer - during summer months and in the south.

Stationary vs Tracking

Solar farms that use PV technology may install stationary or rotating panels in rows. The more panels, the more space is needed - and the more electricity is generated.

Thermal solar farms install collectors - mirrors (heliostats), dishes, reflectors and troughs - that move to track the sun's path across the sky.

Solar Farm Site Assessment

A PV solar farm can range from a few acres to hundreds of acres in size. They can be found across the country.

A thermal solar farm can be small but most are large - in the thousands of acres. Most are found in desert areas.

Soil composition, water access, and proximity to power lines and substations all play a part in the selection of a site. Zoning issues affect the location of solar farms. Landowners' legal rights to contract for long terms can influence site selection between private and federally owned land.

Solar Farm Financing options

To get an installation built, most solar farms rely on a combination of loans and grants from both public and private sources. National programs run by government lenders such as the U.S. Department of Agriculture and the U.S. Environmental Protection Agency are one source of financing. Private investors and public/private partnerships are typical sources of funds. Other options that may be part of the financing deal include leasing land from a user of the solar power generated by the farm.

Solar Farm Incentives

Rebates and tax credits can help defray the costs of solar farm installation. Feed-in tariffs and solar renewable energy certificates can help make the operation of a solar farm profitable.


How to Develop a Commercial Energy farm

Build Your Business Plan

The fact that you want to build a commercial energy farm means that you want to go into business, and no business of this magnitude will ever fly without a comprehensive business plan. When we talk of business plan in this regard, we are talking of a comprehensive document to covers everything from how you intend to run the commercial energy farm to all the necessary diagrams needed to build the commercial energy farm.
Besides, the fact that it is capital intensive to build a commercial energy farm means that you would require some form of business loan and part of the collateral that you would need to access the loan is your business plan. So also, you would need a business plan to apply and obtain some or even all of the permits and licenses required for this kind of business no matter the country you want to build the commercial energy farm.

Choose The Right Site

If you are done with your business plan document and all the necessary drafting that is required to start your commercial energy farm, the next reasonable step to follow is to take action means that you should look for a suitable location that can accommodate your commercial energy farm.
There are loads of factors you should consider when choosing a location for your commercial energy farm. Some of the basic factors are the location must have appreciable sunlight during the day, the location should not be heavily forested, the location must have easy access to good road network, power grid and above all, the location should be able to get permit for starting and operating a commercial energy farm.
Depending on the part of the country that you are in, it is important to point out that commercial energy farms have subsidy program like tax rebates, and government support via business loans for investors who are interested in operating commercial energy farms.

Perform Initial Financial Analysis

The fact that that you have gone all out to select a suitable location to build your commercial energy farm means that you are serious with the business and the next logical step to follow is to conduct a preliminary financial analysis for the business.
Preliminary financial feasibility will help you allocate figures to the cost of buying the land, the cost of installing all the solar equipment, the cost of connecting the commercial energy farm to the power grid you intend selling your power through, the cost of building the needed facility that will accommodate your employees and of cost the cost of maintaining and securing the facility. The importance of conducting preliminary financial analysis cannot be overemphasized because it is through this step that you will be able to come up with the true figure (closest estimate) of the amount needed to build and operate a commercial energy farm. It will help to know how much you are expected save up or receive additional funding sources.

Land Leasing or Buying

Once you have been able to identify a suitable location for your commercial energy farm and you have been able to successfully conduct preliminary financial analysis, then the next step is to acquire the land. Please note that the acquisition of the land can either be through leasing or outright purchase (ownership) of the land.
The reason why the option you have is restricted to long - term leasing or outright buying is because building a commercial energy farm is a long - term investment, it might take you many years before you break even, and you would not want to do that on a rented land. It will not be cost effective for you, besides the installation of the solar facility is also expensive and you would not want to do that knowing fully well that you are going to be doing it on a short - term basis.

Engineering Design and Technology Selection

If you have acquired the site you want to build your commercial energy farm on, then the next step to follow is to start the basic engineering design and technology selection that is most suitable for the type of commercial energy farm (small, medium or large energy farm) that you want to build.
Please have it in mind that an engineering layout for an energy farm is prepared along with a selection of the suitable technology and of course vendors of the solar equipment that you intend using in the commercial energy farm. Please note that if you get this step right, you will spend less on your operation and that will translate to increase in profit margin for your business.

Needed Permits and Licenses

To start with, no matter the state that you intend to build a commercial energy farm, you are expected to apply and secure all the necessary permits and licenses or else you will be operating an illegal business. Besides, you would need the input of the government to be able to sell your solar energy.
Keep in mind, the regulations and permits for building a commercial solar energy farm differ from state to state and from region to region and this is strictly dependent on federal and state laws. This is not so for smaller power plants that have the capacity to generate 5 Mega Watts or less. Within this range, the requirements are far less and less cumbersome to meet. The bottom line is that the smaller the size of the commercial energy farm, the lower the number of regulations required.
The basic permits needed to launch a commercial energy farm especially in the United States of America includes - Industrial Clearance, Land conversion (Agricultural to Non-Agricultural), Environmental Clearance Certificate, Contract labor license from Labor Department, Fire Safety certificate from Fire Department, Latest tax receipt from the Municipal for the land, Auditor compliance certificate regarding fossil fuel utilization, Approval from Chief Electrical Inspector, Clearance from Forest department etc. Please note that the above permits may vary from state to state

Power Purchase Agreements, What Are They?

A Power Purchase Agreement (PPA) is an arrangement in which a third-party developer installs, owns, and operates an energy system on a customer's property. The customer then purchases the system's electric output for a predetermined period. A PPA allows the customer to receive stable and often low-cost electricity with no upfront cost, while also enabling the owner of the system to take advantage of tax credits and receive income from the sale of electricity. Though most commonly used for renewable energy systems, PPAs can also be applied to other energy technologies such as combined heat and power (CHP).

PPA Considerations

SRECs: Solar renewable energy credits (SRECs) show that a certain amount of electricity was produced using solar energy. They are typically bought and sold by load serving entities (typically regulated utilities) to meet obligations associated with state-level renewable energy standards. SRECs are also used by consumers who voluntarily purchase them for marketing claims or other use. Most often in PPAs , SRECs are owned by the developer. When entering into a PPA, it will be important for a customer to clearly understand who owns and can sell the SRECs generated from the PV system, the risks attendant to SREC ownership, and the tradeoffs with respect to PPA price.

How to finance: While both third-party financing models provide numerous benefits, purchasing a PV system outright has its own benefits. Anyone considering installing a solar PV system should consider each of the financing options available to find the best fit.

Site upgrades: While the developer is responsible for installation, operation and maintenance of a solar PV system, the host customer may need to make investments in their property in order to support the installation of the system, lower the cost of installation or to comply with local ordinances. This might include, for example, rooftop repairs or trimming trees that shade the PV system.

Possible higher property taxes: While a PV system may help to raise the site's property value, there is also a potential increase in property taxes when the property value is reassessed. Different states, however, have different policies in regards to these possible property tax increases.

Execute the Power Purchase Agreement (PPA)

The essence of building a commercial energy farm is to sell clean - green energy to end users or vendors thus the need to draft and sign the needed Power Purchase Agreement (PPA) document. As a matter of fact, you would need to sign a Power Purchase Agreement (PPA) with the Power Utility in your locale who will buy the electricity generated and then distribute same to the end users.

Selection of A System Integrator or a Solar EPC Contractor

The next step to take after signing the Power Purchase Agreement (PPA) document is to select a System Integrator or a Solar EPC Contractor for your commercial energy farm. Please note that if you decide to decide to go with a Solar EPC Contractor then all the solar panels needed in the commercial energy farm needs to be purchased if the Solar EPC Contractor is not a Turnkey One.

Funding your Commercial Energy Farm

No doubt, you would have saved up some money to invest in this business, but trust us, after performing all of this work, you would realize that you still need more money to finance the business hence the need to source for business loan. From research, 60 to 80 percent of the Project is usually Debt Financed. In as much as the operation and maintenance of a commercial energy farm is marginally low, the initial investment is pretty much high.
Part of what you need to do to raise finance for your commercial energy farm is to raise money from investors and business partners, sell shares to interested investors, apply for loan from your bank / banks, pitch your business idea and apply for business grants and seed funding from donor organizations and angel investors and lastly source for soft loans from your family members and your friends who are well-boxed to finance such project.

Building the Commercial Energy Farm

If you have everything in place and you have been able to secure reasonable startup capital, then the next step is to go all out to construct the commercial farm. You are expected to build it to specification therefore you will need to hire competent engineers and project managers, hire suitable equipment and source for permits and business loans. This is very important, because after the completion of the construction of your commercial energy farm, the regulatory authority will be on ground to inspect it before giving you the final approval to go on with the business.
Please note that the construction of an Energy farm / Plant can take between 3 months to 2 years depending on the expertise of the project team. It is also important to note that when it comes to building a Solar Thermal Plant, you are expected to spend much more time on this project. Usually, it will take you between 2-4 years or more to complete the project.

Connection to Grid and Testing

One of the reasons why you would need to ensure that your engineers and project managers build your commercial energy farm to specification is because the energy farm will be subjected to testing before it can be connected to the grid. The bottom line is that the steps will not be complete if testing is not carried out. If the expected standards are not met, you will be required to rectify the problem and another testing will be carried when you are done.

Operation and Maintenance (O&M)

In order to continue to generate or harvest maximum energy from your energy farm, you will be expected to provide an ongoing operation and maintenance document and ensure that you follow them. It might interest you to know that an energy farm has a lifespan of between 25 to 30 years and it requires minimal maintenance and monitoring for it to be efficient and generate the required power output.
Part of the ongoing operation and maintenance requires that solar inverters to be replaced after 12-15 years and also in the situation where it is a Solar Module that fails, it needs to be replaced as soon as possible because it will affect the output of the solar panel. There are other ongoing operation and maintenance that you are expected to carry out such as cleaning the solar panel and monitoring the output

Solar Equipment and Installation Cost

To start an energy farm project, it is necessary to adequately factor in the cost of equipment. This will take up a significant part of the entire energy farm cost. So, what equipment are required? There are basically 5 main types of solar equipment These include solar panels, racking, inverter, performance monitoring and storage option (that is, a grid connection or battery). Let's discuss each of these.

Solar Panels

When looking at solar panels, multiple factors need to be considered. The main considerations will include the panel type or brand. There are lots of brands available. Some of the top brands include SunPower, LG, Silfab, Panasonic, Canadian Solar, Hanwha Q CELLS, Trina Solar, and Jinko Solar. These are top brands due to their high efficiencies, warranty and competitive pricing. Solar panel on the other hand has to do with the make. There are two main types of panels. They include monocrystalline and polycrystalline solar cells. So, which is the best? Monocrystalline solar panels are the best. So, how much do solar panels cost?

Solar Panel Cost

There are 6- and 10-kilowatt solar panel systems. These consist of a long list of brands. However, we'll be restricting our focus to the 8 monocrystalline solar brands mentioned earlier. The cost range varies as listed here.

  • Sunpower Corporation cost for 6kW panels can range between $16,980 to $22,980. The cost of 10kW panels can range from $28,300 to $38,300. LG 6kW panels can range from $15,840 to $19,800. Cost of 10kW panels can range between $26,400 and $33,000. Silfab 6kW solar panels can range from $14,820 to $19,980. 10kW Silfab panels can range from $24,700 to $33,300.
  • Panasonic 6kW panels can cost approx.$15,840 to $20,040. 10kW panels can cost approx. $26,400 to $33,400. Canadian Solar 6kW panels can cost approx. $15,780 to $19,500. 10kW panels can cost approx.$26,300 to $32,500. Hanwha Q CELLS 6kW panels can cost approx. from $15,180 to $19,500. 10kW panels can range from approx. $25,300 to $32,500. Trina Solar Cells 6kW panels can cost approx.$14,950 to $18,300. 10kw panels can cost approx.$24,900 to $30, 500. Jinko Solar 6kW solar panels can range from approx.$16,260 to $20,700. 10kW panels can range approx. From $27,100 to $34,500.
  • Racking-Racking is required for the installation of solar panels on a farm. These are mounting systems which are fixed to the ground while the panels are mounted on top. The number of racking equipment required will depend on how large the farm is. Spacing will also determine the number required. The cost of a single unit solar rack mount will range from $15 to $110. This will be multiplied by the total number of racks required. For instance, if you require 300 rack mounts, the cost per unit is multiplied by 300. Using the higher cost range, we'll get 110 x 300 which equals $33,000.
  • Solar Inverter-Solar inverters come in different brands. Some of the top brands include Magnum Energy inverters, SMA Sunny TriPower Core1, Schneider Conext, SolarEdge HD-Wave, and SolarEdge US-U. The cost for these top inverter brands is as follows; Magnum Energy inverter can start at approx. $2,255. SMA Sunny TriPower Core1 480v goes for approx. $7,475. Schneider Conext comes in at approx. $3,850. SolarEdge HD-Wave costs approx. $1,295 while SolarEdge US-U costs approx. $1,295. The output rating for these solar inverters ranges from 4.4kW to 6kW.
  • Performance Monitoring-There are several performance monitoring equipment. These range from battery monitors, photovoltaic or PV meters and charge controllers. A battery monitoring kit comes in various models. Some of the most popular models include the Magnum Energy ME-BMK at approx.$175 (This cost $170 without shunt). The Magnum Energy ME-MW-W Magweb wireless monitoring costs approx. about $560.
  • An analogue PV meter starts at $55 while charge controllers range from $465 to $980. These are unit costs. For energy farm projects, you might want to take advantage of the economies of scale by purchasing in bulk.

Storage Option
This has to do with storage equipment like batteries. When we talk of batteries, we are referring to deep cycle battery systems. Like most solar equipment, these come in different brands. Some of the most popular models include the Four-Star Solar Rolling Thunder RT-2000 Backup which costs approx. $4,550 with 6kW AC output.
Others include the Four-Star Solar Backup Power that goes for $5,512, Crown AGM 220 Ah 24 VDC at approx. $1,022 and Crown AGM 440 Ah 12 VDC at approx.$1,056. Others are the Full river AGM 415 Ah 12 VDC which goes for approx. $1,004 and the Crown 430 AH 12 VDC for approx. $744.


How much does it cost to set up an energy farm? The initial cost required to start up this business will vary. The PV type installed, the size, the installer, locations, availability of sunlight and the company to supply the panels are the factors that will affect the cost of starting a energy farm. But on average, an energy farm is expected to generate at least 1Megawatt which will be capable of serving more than approx. 200 households. With that in mind, the general installation for a 1MW could be assumed to cost upwards to $1 million or more.
As noted initially, an energy farm is capital intensive, therefore starting an energy farm might require that you seek for grants from governments or private sources. Note that your business model must be impressive, if your business model is appealing, a large amount of money might be given from investors. In fact, Banks may be interested to offer traditional business loans for starting up.

Other Points to Consider?

While these are the major equipment to be purchased for an energy farm, there are still other cost implications to consider. These include tax credits (which makes up about 30%), installation costs which could range approx. from $33,000 $150,000 or more based on the size of the energy farm. However, before anything else, you'll need to find a suitable property for an energy farm. The cost of leasing such property will impact on overall cost. The cost incurred will depend on how well a lease agreement is negotiated. The above information include the cost breakdown for an energy farm. These consist of the most main equipment plus installation costs. Each of these have been briefly discussed. Because energy farms will require bulk purchase, you'll be benefiting from the economies of scale.