Housing prices may be way down in much of California and the western states, but some who own desert land suitable for solar or wind are cashing in.
Although most land suitable for large renewable energy plants is owned by the federal government, some developers would rather avoid the bureaucracy and environmental laws even though they could pay much lower lease prices.
It just goes to show you – people who own what they thought was worthless desert land are now sought out by land speculators and developers, reports the Calgary Herald.
Land that just a few years ago would sell for under $500 an acre now fetches as much as $20,000 an acre. Farmers, which used to get offers from developers for housing communities and golf courses, are now converting to solar and wind farms instead.
In one example, alfalfa farmers in Arizona sold 3,000 acres to investors who turned around and sold it for $45 million to solar developer Abengoa.
Not everyone cashes in, of course. Many sales collapse at the last minute, when developers decide not to proceed with projects, such as an inability to sign power purchase agreements.
In fact, the complexities involved in solar projects have made for an uncertain market, and as many as 90% of solar land deals fall apart in the first year, reports the Calgary Herald. Developers are also hesitant to pay high prices for land knowing the risks of a real estate bubble.
We recently reported on Boulder City, Nevada, which is cashing in after setting aside land for solar development.
Read the full article:
Loading...