How Much Does a Solar Farm Cost to Install? [2024 Data]
Building a solar farm ranges from $800,000 to over $1 million per megawatt, not including the land cost.
Building a solar farm costs about $0.80 to $1.36 per watt to install, not including the cost of land. By acreage, building a solar farm typically costs between $400,000 and $500,000 per acre.
If you live on a large plot of land, you might consider building a solar farm as a new business venture. Aside from generating clean energy for your own property, you can sell energy to local households who buy into a community solar program. The upfront cost may seem high, but the operation will reduce your energy bills and even earn you a profit by selling extra clean energy to the grid. Here’s what to know.
Solar Farm Cost Factors
| Solar Farm Cost by Watt | Solar Farm Cost per Acre | Solar Farm Cost by Megawatt |
|---|---|---|
| $0.80–$1.36 | $400,000–$500,000 | $800,000–$1 million+ |
Solar farms are not a residential project for the average homeowner. Instead, installing a solar farm becomes a larger-scale business that can require a high upfront investment.
Solar farm costs can be estimated by energy output (megawatts) or size (acres). One megawatt is the power equal to 1 million watts, and one megawatt will power about 164 homes. Several factors contribute to this project's overall cost, such as the type and size of the solar farm you install.
Types
Community Solar Farms
Community solar farms offer higher energy output than simply installing solar panels on your rooftop. Solar farms are also more cost-effective, running between $0.80 to $1.36 per watt, and solar panel installation costs about $2.50 to $3.50 per watt. These large-scale projects usually provide 5 megawatts or less, and a megawatt can power an average of 164 homes.
Commercial Solar Farms
Larger than a community solar farm, many companies can opt to use a commercial solar farm to generate the electricity they need to operate their business. Depending on the business size, a commercial solar farm may span a few acres of land to a few hundred acres, making this project start at $400,000.
Utility-Scale Solar Farms
As governments work toward a more sustainable energy future, utility-scale solar farms become more commonplace to power hundreds or thousands of homes. Utility-scale solar farms may span 1 megawatt to 2,000 megawatts. Since there is a greater need for higher wattage for this giant-scale project, the cost can start at $800,000, not counting the land cost.
Materials
A solar farm has many components, from the panels themselves to the batteries that store the energy. Since so many different components are required, it’s safe to say that the cost of materials will be the bulk of your total cost of installing a solar farm. Some materials you will need include:
Racks to hold panels
Foundations for the racks
Inverters
Cables and connectors
Additional equipment to connect the solar plant to the grid and for battery storage
Monitoring systems
Security equipment, including fences and cameras
Solar Panels
The type of solar panel chosen for the solar farm will make up a large part of the overall materials cost. While the cost per watt might be small on its own per solar panel, it’s important to remember the scale of your project.
| Type of Solar Panel | Average Cost, Per Watt | Average Solar Panel Life Span |
|---|---|---|
| Monocrystalline | $1–$1.50 | 40 years |
| Polycrystalline | $0.90–$1 | 25 years |
| Thin Film | $0.70–$1 | 15 years |
Size
The size of your solar farm is another significant factor in your overall cost. Smaller property owners who want to provide solar energy to their townhomes or apartment complexes will need a solar farm of significantly smaller size than a government-owned entity trying to provide solar energy for thousands of homes. The size of your solar farm will impact your land size needed, the amount of materials (like solar panels), and operating costs.
| Solar Farm Type | Average Land Size |
|---|---|
| Community | 3–20 acres |
| Commercial | 10–40+ acres |
| Utility-Scale | 10–100+ acres |
Cost of Land
The land needed for the farm is directly related to the size of your solar farm. If you already own the land required to install the solar farm, you’re a step ahead of the game. If not, you’ll have to ascertain the property to build. Across the U.S., acreage can range from as little as $3,400 in Wyoming to as much as $78,500 in Delaware.
| Size of Land | Capacity of Solar Farm | Approximate Residential Homes Powered |
|---|---|---|
| 6 acres | 1 megawatt | 164 homes |
| 15 acres | 2.5 megawatts | 610 homes |
| 30 acres | 5 megawatts | 1,250 homes |
| 60 acres | 10 megawatts | 2,500 homes |
| 150 acres | 25 megawatts | 6,100 homes |
Labor
Installation will make up about 10% of the project cost for starting a solar farm. But in addition to having construction and solar companies develop the land and install the panels, you’ll need to hire people to maintain the grounds to prevent plants from growing over the panels and to clean the solar panels for efficiency.
Permits
In order to build a solar farm, you’ll need special permits throughout the process. As with most things, the cost of these permits will vary from state to state. Although some states have streamlined the permitting process for solar farms due to their impeccable renewable energy, others still require a lengthy process.
Solar Farm Ongoing Expenses
Installing a solar farm will help you harness the power of the sun, but not without additional ongoing expenses after the initial install.
Maintenance
You can plan to budget around $15,000 per megawatt for annual maintenance. This includes cleaning the solar panels and monitoring the system’s performance. Most solar panels need to be cleaned every six months to remove dirt and debris.
You’ll also likely need vegetative maintenance for your solar farm, which includes mowing, weeding, and other grass control measures.
Insurance
The installation and operation of a solar farm will require you to carry insurance. The exact price you pay will depend on factors like the deductible and coverage amount you choose, the size of your solar farm, and any location-specific risks you are at high risk for. Most generally, insurance premium rates range from $0.15 to $0.30 per $100 of total insurable value.
Your solar farm insurance can provide different coverages, including all-risk property coverage, general liability, equipment breakdown, and business interruption. A solar farm insurance broker can offer you more specific pricing information based on your needs.
DIY Solar Farm Installation vs. Hiring a Pro
You’ll need to work with a solar panel company and your local, state, and federal governments and utility companies to install a solar farm. This massive project cannot be done alone, and it will require planning permissions and professional installation.
According to the Environmental Protection Agency, developing a solar farm is lengthy and requires certifications, project proposals, and purchase agreements, just to name a few. You’ll be required to set up a business and purchase insurance for your solar farm as well.
Tips to Lower Solar Farm Installation Costs
Most solar farms are designed for community or utility use, as these massive areas of solar panels will supply enough energy to power many households. You can expect to earn about $14,000 to $40,000 annually for each megawatt of power from your community solar farm. Plus, your own household can save up to 15% of annual electricity costs with solar energy.
If you want to build a solar farm on your land, you can:
Find local homeowners who are interested in purchasing power from your community solar project to offset the cost of installing and maintaining a solar farm
Apply for federal and state government incentives to offset the cost of starting a solar farm.
Invest in high-quality solar farm materials upfront to maximize both longevity and performance.
Develop a maintenance program, including routine cleaning and performance monitoring.
Choose the right location for your solar farm—low shade and high sun rates. Additionally, consider the potential to expand in the future.
Instead of building your own solar farm, another option is to provide your land to lease for a solar project. This will generate a passive income, where you can earn around $300 to $2,000 per acre each year by providing your land for another developer to install and manage the solar farm.
Frequently Asked Questions
Rooftop solar panels supply energy to a single household, where a solar farm can power multiple homes at once with clean energy. Residential rooftop solar panels cost more per watt with a lower project total, and those panels only service the residence they are installed on (in most circumstances). With a solar farm, multiple households can buy into the project and share the overall cost.
You don’t have to build your own solar farm to reap the benefits of clean energy. In the U.S., there are 41 states with at least one community solar farm. EnergySage has a tool that allows you to find community solar projects near you, or you can contact your local utility company for further information.
Homeowners who use solar power can save 5% to 15% on their energy bills per year. If you own a community solar farm, it can generate about $14,000 to $40,000 per megawatt annually. Leasing your land for someone else to develop a solar farm will earn you up to $2,000 per acre per year.
The actual time it takes to construct the solar farm is relatively short, taking between 2 and 4 months on average. That timeline is dependent on site conditions, crew size, and overall solar farm size.
However, the time it takes to get the ball rolling is significantly longer, ranging from 3 to 5 years. With a project of this scale, you’ll need to obtain all of the proper permits and approvals to start breaking ground, and depending on your location, that could be an extended process.