Source: Texas Agriculture Law Blog – Tiffany Dowell
There is surprisingly little information available for landowners considering the pros and cons of entering into a solar lease agreement. “We’re still early in the era of solar energy development in West Texas. Lease rates appear very enticing, particularly in an area of low commodity prices, but landowners should seek advice from straightforward, practical-minded legal counsel to minimize unintended consequences and avoid a deal that’s ‘too good to be true,” Stamford, Texas attorney James Decker stated.
Some of the key considerations for landowners considering and/or negotiating a solar lease include:
- Rights of mineral owners
- Solar leases are usually not short in duration
- Royalties are not common in solar leases
- Solar leases will likely prevent any other use of the property
- Watch for prohibition on use of other properties
- A solar project could impact special tax use valuation eligibility
- Landowners should watch for common legal technicalities
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