Jim Rebhuhn, accredited farm manager with Hertz Farm Management in Mt. Vernon, Iowa, said adding a wind turbine to any ground is a good way to boost its value. The same is likely true of solar panels, but there isn’t enough data to make a definite statement on that yet.

“The most data we have is on wind turbines, because they’ve been around longer than some of these solar farms. But in just about every case, when a farm sells and it has a turbine on it, we are seeing a premium,” Rebhuhn said.

Part of the reason for that premium has to do with the contracts and payments put in place when the energy projects were built. Those agreements provide additional income for whoever owns the land, which makes it more valuable.

“Whether you are a farmer or investor, you look at the property and say ‘Hey, it generates X number of dollars over and above what corn and soybeans would return,’” Rebhuhn said. “They are willing to pay more because of that, and that’s what buyers are looking at in terms of purchase decisions.”

Wendong Zhang, who leads Iowa State University’s land value survey each year, said that in previous research they have found solar installations don’t have as much impact on farm land values, primarily because the covered area is unable to be farmed. He also noted wind turbines may not have as big of an effect.

“A group of economists in Kansas looked at transaction data and didn’t detect statistically higher prices or lower prices for farmland with proximity to turbines,” he said.

One of the primary concerns with energy projects is with appearance. Nearby homeowners and landowners don’t want the equipment to be in their line of sight.

Despite that, land values are not decreasing for nearby homes, Zhang said. The addition of solar panels may in fact bring added value to the land overall.

“Think of, in northwest Iowa where there are animal feeding operations, there are studies that show in general residential homeowners don’t like the smells and there is evidence your housing values could be affected by that,” he said.

Rebhuhn said while the value of the land may increase, there is still a human element at play when determining just how much the view of solar panels and wind turbines affects the current homeowners. He said if the land is owned by a farmer or someone who lives on the land, it is likely to be a tougher decision to add these projects compared to an investor who isn’t likely to be around the land often.

“When there’s a turbine right in your backyard, it certainly takes a different approach versus on a farm when you don’t live in the area,” Rebhuhn said. “Certainly you are trying to be a good neighbor, but there’s less of an impact on you when you don’t see it every day.”

Rebhuhn said solar tends to be less visually invasive overall, but large scale projects tend to bring out complaints from neighbors who are used to seeing rolling hills of corn and soybeans compared to solar panels.

He said when planning where to put a project, wind turbines are easier to place if the land allows. Average wind speeds tend to be the biggest factor for wind turbine location. That is why many wind projects were placed in northwest Iowa, southwest Minnesota or in North Dakota and South Dakota.

But there are other things to consider as well.

“A lot comes based on how close you are to the grid, especially with solar, and so we are seeing things crop up a bit in different locations,” he said. “Those other areas are a bit more saturated so they are moving to other areas that maybe might not produce quite as much, but it’s closer to the grid.”

For solar, farmers could look at the feasibility of using corners of fields that may be lower-quality land and leaving the best ground for farming, he said.

Zhang said no matter what decision is made or what energy is produced, landowners need to understand what they are getting into when they enter these agreements.

“It’s best to have really good legal advice so that you really kind of know or can identify the pitfalls,” he said. “There are a lot of attorneys who specialize in the area of solar and wind, so that’s one thing we’d recommend.”