Michigan's Solar Growth - MEC - Midwest Energy & Communications

One of the things I enjoy about living in this area is access to big city amenities, without the big city hassle. For example, from my house, I can be in the shops, restaurants, and malls of Mishawaka in about 15 minutes, but still have the quiet, rural country life that I like. Another benefit that I frequently utilize is the South Bend International Airport. I’ve always liked that airport because it’s smaller and quicker, and I don’t have to walk miles to get to my gate. Plus, it’s fun to get an aerial view of our area. If I am flying to Detroit, I usually get a great view of our headquarters in Cassopolis. As my plane was landing on my latest trip, I noticed something unexpected: an abundance of solar farms. I have to admit that I was shocked at how many I saw, and it definitely hit home just how much our industry is changing. We’re about to see a lot more of that in Michigan.

In the fall of 2023, Michigan passed the Clean Energy and Jobs Act, which requires 100% of the state’s energy to come from non-carbon sources by 2040. In order to meet that mandate, utilities must build a significant amount of renewable power. According to The Detroit News, doing so with just solar will require about 209,000 acres of land in Michigan. I’ve heard it described as a mile-wide path of solar that runs from the state line to the Mackinac Bridge.

As a result, third-party solar companies are actively looking for land for utility-scale projects. I know of a few farmers who have been approached with deals as high as $20,000 per acre for purchase or $1,600 per acre each year for a 25-year lease. I suspect that some of you have heard similar stories.

Unfortunately, situations like these can inspire a few bad actors who try to take advantage of people. Here are some things to watch for:

• Don’t sign anything under pressure, no matter how aggressive a salesperson is or if they tell you a specific offer is only good for a limited time. Be wary of any company that refuses to give you time to review or to allow you to negotiate the contract.
• Take the time to thoroughly read all documents and have your tax, legal, and financial advisor review everything as well. They can help you make an informed decision.
• Research the company. Do they have an existing relationship with a utility that generates power? How long have they been in business? Do they have any pending litigation? How transparent are they? According to the Michigan Farm Bureau, some contracts contain confidentiality clauses that prevent anyone from talking about the terms of the deal. Keep in mind that you are not working with the utility, and the utility will not have influence over your contract.
• If you are considering a lease agreement, find out if the lease payments will keep up with inflation, what the renewal options are, what happens after the lease is up, and who is responsible for land restoration once the lease is over.
• If you are considering selling, find out the option terms. Will you be able to change your mind or sell to someone else during that term?
• Also, be prepared that once the company is actually ready to build, they may try to renegotiate the contract to offer you a lower price. Why would they be offering you more than market?

MEC supports renewable energy, and having a mix of both traditional and renewable generation strengthens our grid and improves overall reliability. Additionally, the reality is that many solar farms will need to be built in the near future. The good news is that MEC will meet the state-mandated requirement largely thanks to our power supplier’s purchase power agreement with Palisades Nuclear Plant. The bottom line is that only you can decide if this works for your family, and I’m not here to offer any opinions. We just want everyone to be aware that some less-than-desirable companies may be out there. Remember, if it sounds too good to be true, then it probably is. Nonetheless, I fully expect to see even more solar farms the next time I take to the sky from my local airport, but I hope when I do, that it was a win-win for all parties.