Agrivoltaics — the practice of generating solar electricity and growing crops or grazing livestock on the same parcel of land — has moved from a research concept to a mainstream farming strategy. By 2026, more than 2.8 million acres of U.S. agricultural land host some form of dual-use solar, and NREL projects that co-locating solar on just 1% of U.S. cropland could meet the nation's entire electricity demand while maintaining agricultural productivity.
For farmers and rural landowners, agrivoltaics is one of the most financially compelling energy strategies available: it unlocks a new revenue stream from land that continues producing food, leverages the federal 30% Investment Tax Credit, and may qualify for substantial USDA REAP grants that can cover up to 50% of installed costs.
This guide covers everything farmers, ranchers, and agricultural landowners need to know to evaluate agrivoltaics for their operation.
What Is Agrivoltaics?
Agrivoltaics (also called agrivoltaic farming, agrophotovoltaics, or APV) uses the vertical space above agricultural land for solar panels while maintaining productive use of the ground below. The panels are typically mounted on elevated structures (ground-mount systems elevated 8–12 feet above grade) rather than standard low-tilt ground mounts, creating a shaded canopy under which crops can grow or animals can graze.
The core insight of agrivoltaics: most solar panels are installed 2–4 feet above grade, making the land beneath them unusable for agriculture. Elevating the panels captures the same solar energy while preserving agricultural land use — addressing one of the primary community objections to utility-scale solar development (loss of farmland).
Three Types of Agrivoltaic Systems
1. Elevated Fixed-Tilt Arrays (Most Common) Standard ground-mount frames built 8–12 feet high. Used for sheep and goat grazing, shade-tolerant crops (berries, herbs, leafy greens), and pollinator habitat. Lower cost than tracking systems; suitable for most crops and livestock. Installed cost: $2.20–$3.00/W at utility scale, $2.80–$3.80/W at farm scale.
2. Elevated Single-Axis Tracking Arrays Solar panels mounted on trackers that follow the sun east to west, maximizing energy production while providing variable shading throughout the day. Used in research installations for crop optimization (varying shade levels). Higher energy output (15–25% more than fixed tilt) and better crop performance on heat-sensitive crops due to afternoon shading. Installed cost: $3.00–$4.20/W at farm scale.
3. Greenhouse and Tunnel Integration Solar panels integrated into greenhouse roofing or polytunnel structures, replacing a portion of the glazing. Particularly effective for specialty crops (strawberries, peppers, tomatoes) where the double benefit of covering structure plus energy generation creates rapid paybacks. Several U.S. greenhouse solar programs offer specialized financing for this configuration. Installed cost varies significantly by greenhouse integration complexity.
Crop Compatibility with Solar Panels
Not all crops perform equally under solar panels. Research from Oregon State University, UMass Amherst, the University of Arizona, and NREL's InSPIRE program provides a growing evidence base for agrivoltaic crop compatibility.
Excellent Performers Under Solar Panels
Leafy Greens and Herbs Lettuce, spinach, Swiss chard, kale, basil, cilantro, and most leafy greens are naturally shade-tolerant and often perform better under solar panels than in full sun. The afternoon shading reduces heat stress, bolting, and water requirements. UMass research found lettuce yields were 12% higher under solar panels, while water use dropped by 33%.
Berries Strawberries, blueberries, raspberries, and blackberries are shade-tolerant at moderate sun levels. Many berry varieties actually struggle with excessive UV exposure — solar panels can improve quality (reducing sunscald on fruits) while maintaining yields. Premium berry prices make this one of the most profitable agrivoltaic combinations.
Root Vegetables Beets, radishes, carrots, and turnips show neutral-to-positive yield responses under partial shading. These crops are less susceptible to reduced photosynthesis because their energy goes to root storage rather than fruit production.
Hops Oregon State University's agrivoltaics research found hops — a climbing vine crop — performs particularly well in agrivoltaic systems. The trellising required for hops can be integrated with solar panel support structures, reducing installation costs. Oregon's craft beer industry creates strong local demand.
Pollinator Habitat and Native Wildflowers A growing segment of the solar industry installs native wildflower meadows and pollinator habitat under panels instead of conventional crops. These produce no direct food revenue but reduce mowing costs, qualify for Conservation Reserve Program (CRP) payments, improve local pollinator populations that benefit neighboring crops, and satisfy the "co-use" requirements for some state agrivoltaic incentive programs.
Crops That Work with Modified Panel Design
Corn, Soybeans, and Wheat The U.S.'s major commodity crops are sun-hungry and cannot tolerate significant shading. However, research at Colorado State University found that high-clearance panels (12+ feet) with wide row spacing can maintain 60–80% of commodity crop yields while generating substantial electricity. The economics depend heavily on commodity prices and land values.
Wine Grapes and Specialty Crops California and Washington wine grape trials show that solar canopy systems can reduce sunscald on Chardonnay and Pinot Gris grapes while maintaining sugar development. These systems are expensive to install but the high per-acre value of wine grapes makes the economics work.
Solar Grazing: The Fastest-Growing Segment
Solar grazing — using sheep and goats to manage vegetation under utility-scale solar arrays instead of mowing — has become a mainstream practice at solar farms. By 2026, the American Solar Grazing Association estimates that more than 4,000 U.S. solar installations host grazing animals.
For Solar Farm Operators: Grazing eliminates 60–80% of mowing and vegetation management costs, which typically run $300–$600/acre/year. Grazing contracts run $75–$200/acre/year for the grazier.
For Farmers: Solar grazing provides a revenue stream ($75–$200/acre from solar farm operators) plus improved pasture management (rotational grazing under panels) at zero infrastructure cost. Sheep are preferred over goats (goats chew panel wiring); Katahdin and Babydoll Southdown breeds are most commonly used.
For On-Farm Solar: Farmers installing their own solar arrays can integrate their existing livestock operation. The panels provide shade that reduces heat stress in grazing animals, improving weight gain and reducing water consumption by 12–18% in trials by the National Renewable Energy Laboratory.
Agrivoltaics Economics: What to Expect
On-Farm Solar Ownership Model
For farms generating their own electricity from an agrivoltaic system:
| System Size | Installed Cost | After REAP + ITC | Annual Energy Value | Simple Payback |
|---|---|---|---|---|
| 50 kW farm | $150,000 | $60,000–$75,000 | $8,000–$14,000 | 5–9 years |
| 250 kW farm | $625,000 | $225,000–$290,000 | $40,000–$70,000 | 4–7 years |
| 1 MW farm | $2.2M | $770,000–$990,000 | $160,000–$280,000 | 3.5–6 years |
Assumes USDA REAP grant (25–40%) + Section 48 ITC (30%) applied to full project cost. Energy value based on $0.10–$0.18/kWh utility rates or diesel displacement.
Land Lease Model (Utility-Scale Agrivoltaics)
If a utility-scale developer wants to site a solar project on your land:
- Standard land lease rate: $500–$2,500 per acre per year, depending on sun resource, grid proximity, and land value
- Agrivoltaic premium: Some developers pay 15–25% above standard solar land lease rates for agricultural land that will be maintained in production (more favorable with communities and permitting)
- Lease terms: Typically 25–30 years with 1–3% annual escalators
- Acre requirements: Utility-scale projects typically need 5–8 acres per MW of capacity, with minimum sizes of 10–50 MW common
Dual-Revenue Calculation
A 200-acre Illinois corn farm leasing 50 acres for agrivoltaic solar while grazing sheep on the site:
| Revenue Stream | Annual Income |
|---|---|
| Solar land lease (50 acres × $900/acre) | $45,000 |
| Solar grazing contract (50 acres × $150/acre) | $7,500 |
| Remaining 150 acres of corn at $200/acre net | $30,000 |
| Total farm revenue | $82,500 |
| Previous total (200 acres corn only) | $40,000 |
| Revenue increase from agrivoltaics | +$42,500/year (+106%) |
USDA Programs Supporting Agrivoltaics
USDA REAP (Rural Energy for America Program)
REAP is the primary federal grant for farm-scale solar, providing:
- Grant: 25–50% of eligible project costs (up to $1 million)
- Guaranteed loan: Up to 75% of eligible project costs
- Eligibility: Agricultural producers with at least 50% gross income from agricultural operations; rural small businesses
For a 250 kW on-farm agrivoltaic system at $625,000, REAP could provide $156,000–$312,500 in grant funding. Combined with the 30% ITC, the net cost drops to $128,000–$250,000. See the USDA REAP solar grant guide for application details.
USDA NRCS Conservation Programs
The Natural Resources Conservation Service (NRCS) now recognizes agrivoltaics as a conservation practice:
EQIP (Environmental Quality Incentives Program): NRCS pays farmers 50–75% of practice costs for conservation measures. In states where agrivoltaics has been approved as an EQIP practice (including CO, CA, MN, and several Northeast states), this provides an additional 15–25% cost offset on top of REAP and ITC.
RCPP (Regional Conservation Partnership Program): Several RCPP grants specifically fund agrivoltaic demonstration and adoption projects, providing technical assistance, payment for research data collection, and partial project funding.
Farmland Conservation: Unlike standard ground-mount solar, agrivoltaic systems often qualify for agricultural land preservation programs because the land remains in agricultural production, avoiding the "conversion of farmland" objection that can block standard solar projects.
FSA Programs
The USDA Farm Service Agency (FSA) offers energy development loans and guarantees that can be combined with REAP grants for agrivoltaic projects. Farmers may also access operating loans to cover equipment and crop transition costs during agrivoltaic installation.
Tax Incentives for Agricultural Solar
Section 48 Commercial ITC (vs. Section 25D Residential)
Agricultural solar installations qualify for the Section 48 Commercial ITC, not the Section 25D residential credit:
| Feature | Section 48 (Commercial/Farm) | Section 25D (Residential) |
|---|---|---|
| Base ITC rate | 30% | 30% |
| Energy Community bonus | +10% (40% total) | Not available |
| Domestic content bonus | +10% | Not available |
| Maximum credit | No cap | No cap |
| Who claims it | Farm entity (LLC, S-corp, etc.) | Individual homeowner |
| MACRS depreciation | Yes — 5-year MACRS | No |
| Bonus depreciation | Yes — 40% in 2026 | No |
The combination of Section 48 ITC + MACRS bonus depreciation returns approximately 38–42% of project cost in year one in tax benefits for farms with sufficient tax liability. See the small business solar guide for the detailed year-one math.
Energy Community 40% ITC
Farms in former coal mining communities, coal plant closure areas, and qualifying statistical areas may claim the 40% Energy Community ITC (10 percentage points above the standard 30%). Rural areas across the Mountain West, Appalachia, Midwest, and Gulf Coast frequently qualify. Check eligibility at the IRS Energy Community tool.
ITC on Battery Storage
Battery storage added to agrivoltaic systems qualifies for the full 30% (or 40% Energy Community) ITC as of the Inflation Reduction Act. A 100 kWh battery bank on a 250 kW farm system (typical for time-of-use optimization and backup power) would add roughly $35,000 in installed cost and $10,500–$14,000 in additional ITC value.
State Agrivoltaic Programs
Several states have created specific programs or incentive tiers for agrivoltaic development:
Colorado: The Colorado Energy Office and Colorado State University's agrivoltaics research program supports farmers through technical assistance grants and connections to EQIP agrivoltaic funding. SB 21-264 created a pathway for agrivoltaic projects under certain conservation programs.
Massachusetts: The MA SMART program includes an agricultural land use adder for solar installations on farmland. Projects on land enrolled in Chapter 61A (agricultural preservation) get a $0.01–$0.03/kWh adder above the base SMART rate, recognizing the dual-use benefit. Massachusetts solar guide
Minnesota: Xcel Energy's Solar*Rewards program does not specifically distinguish agrivoltaic projects, but farms in qualifying areas benefit from the 10-year PBI regardless of crop/grazing integration. The Minnesota Department of Agriculture has published agrivoltaics research supporting EQIP approval. Minnesota solar guide
New York: NY-Sun offers a community solar pathway that can include agricultural subscribers. NYSERDA has co-funded several agrivoltaic demonstration projects through the Clean Energy Fund. New York solar guide
Oregon: The Energy Trust of Oregon (ETO) accepts agrivoltaic projects under its Agricultural track, with cash incentives up to $2,500 for eligible installations. Oregon solar guide
Iowa and Nebraska: Both states' strong USDA REAP uptake (among the nation's highest per-capita) makes these the most active agrivoltaic states in the Corn Belt. Farm bureaus in both states have published agrivoltaic adoption guides. Iowa solar guide, Nebraska solar guide
Permitting and Zoning for Agrivoltaic Projects
Agrivoltaic permitting follows solar project permitting rules but often benefits from agricultural classification:
Agricultural Zoning: In most states, land zoned agricultural (AG) allows solar as an accessory use to the agricultural operation. Agrivoltaic framing — emphasizing the continued agricultural use of the land — often navigates zoning restrictions that would block standard ground-mount solar.
County vs. State Jurisdiction: Permitting for farm-scale solar (< 5 MW) typically occurs at the county level. Key documents required: building permit (electrical permit and structural calculations), utility interconnection application, environmental review (varies by state and project size), and sometimes a conditional use permit.
Conservation Easements: Farms under USDA conservation easements (ACEP, WRP) must verify easement terms before installing solar. Most easements written before 2020 did not contemplate solar; NRCS and USDA have issued guidance allowing agrivoltaic systems when agricultural use continues. Farms should obtain written confirmation from their easement holder before proceeding.
SolarAPP+: The DOE's Streamlined (Simplified) Solar Permitting tool (SolarAPP+) applies to residential systems up to 38.4 kW and does not cover most agricultural installations. Farm systems typically need standard permit review.
How to Find Agrivoltaic Installers and Resources
Agrivoltaic projects require installers with experience in elevated mounting systems, agricultural environments (equipment clearance, wildlife protection for wiring), and compliance with USDA programs. General-purpose residential solar contractors may not have this experience.
American Solar Grazing Association (ASGA): The ASGA maintains a directory of solar farms seeking graziers and a list of agrivoltaic-friendly solar developers and installers. Contact at solargrazing.org.
NREL InSPIRE Program: The National Renewable Energy Laboratory's Innovative Site Preparation and Impact Reductions on the Environment (InSPIRE) program publishes agrivoltaic research and maintains a database of agrivoltaic installations with crop performance data.
State Cooperative Extension Services: Land-grant university extension offices in most agricultural states now have agrivoltaics specialists. Oregon State, Colorado State, University of Minnesota, and Cornell Cooperative Extension offer free consultation for interested farmers.
Agrivoltaic Solar Developers: Companies specifically developing agrivoltaic utility-scale projects in the U.S. include Nexamp, Sunwealth, and multiple regional developers. These companies typically handle all permitting, interconnection, and land lease negotiations.
The Solar System Designer Tool can help you estimate system size and components for a farm-scale on-site agrivoltaic installation. The Solar ROI Calculator can estimate payback for your state and system size.
When Agrivoltaics Makes Sense: Decision Framework
| Scenario | Agrivoltaics Recommendation |
|---|---|
| Irrigated cropland with high water costs | Excellent fit — shade reduces evapotranspiration 20–30%, reducing irrigation costs |
| Sun-exposed livestock pasture | Excellent fit — reduced heat stress, lower water consumption, grazing revenue |
| Shade-tolerant specialty crops | Excellent fit — often improves crop yield and quality |
| Row crops (corn, soybeans) on flat land | Moderate — requires high-clearance elevated panels, 60–80% yield maintenance |
| Orchards or vineyards | Evaluate carefully — species-specific response; excellent for some wine grape varieties |
| Highly productive cropland (Top 10% yields) | Consider standard solar lease only — don't risk top yields on production systems |
| Land under conservation easements | Review easement terms first; get written NRCS confirmation |
| Farm with high electricity costs ($0.12+/kWh) | On-farm ownership strongly preferred over land lease |
| Farm with low electricity costs ($0.09–/kWh) | Land lease model often more attractive than ownership |
The Bottom Line for Agricultural Solar
Agrivoltaics is no longer an experimental concept — it is a proven, scalable approach to solar energy that is uniquely compatible with American agriculture. The financial case is compelling: USDA REAP grants of 25–50%, Section 48 ITC of 30–40%, and new state incentive tiers create a stack that can reduce net project cost to 25–45 cents on the dollar before energy savings.
For livestock operations, solar grazing creates immediate revenue with zero capital investment by leasing grazing rights on existing or third-party solar farms. For crop operations, shade-tolerant specialty crops under elevated panels can improve both yield quality and farm profitability while generating electricity.
The 2026 window is especially favorable: REAP funding under the Inflation Reduction Act remains robust ($2B+ authorized), Energy Community ITC bonuses apply to many rural areas, and agrivoltaic installers and developers have scaled significantly since 2022 — creating competitive markets and better-understood project economics.
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