Agrivoltaics bypasses solar zoning curbs to unlock gigawatt-scale investment
Dual-use solar farms are emerging as a financial solution to local zoning opposition, opening a multi-gigawatt pipeline of investment opportunities on fallow and active farmland in the US and Europe.
Solar developers are increasingly turning to agrivoltaics to bypass local zoning restrictions and scale renewable energy infrastructure, unlocking multi-gigawatt investment pipelines across the US and Europe.
The strategy, which installs solar panels above or around active crops or livestock, directly addresses a primary bottleneck for utility-scale solar: political opposition to using arable land. By allowing farming to continue underneath the arrays, developers can secure land access in markets where large-scale solar has effectively been banned.
A landmark example is taking shape in California. Private developer Golden State Clean Energy is working with local water agencies and farmers to convert roughly 70,000 acres of fallow land in the San Joaquin Valley into solar sites. The company’s Valley Clean Infrastructure Plan targets up to 21 GW of solar capacity paired with 21 GW of battery storage across 136,000 acres over the next decade. The project is designed to power more than 10 million homes and advance California’s mandate for 100% renewable energy by 2045. For institutional investors, the project structure is notable: Golden State will develop only 5 to 10 per cent of the 30 to 60 individual sites, leaving the vast majority of the pipeline open to third-party capital.
In Virginia, soaring power demand from data centres is colliding with strict local ordinances. A 2020 law requires the state’s two largest utilities to procure over 16 GW of land-based renewables, primarily solar. However, nearly two-thirds of Virginia counties have outlawed or severely restricted large-scale solar projects due to concerns over farmland loss. In June, the state government codified a legal definition for agrivoltaics to encourage investment, providing a viable pathway for utilities to meet their mandates without triggering local vetoes.
Beyond navigating permit grids, agrivoltaics offers operational and financial advantages. Crops emit water vapour that cools the panels from below, improving solar cell efficiency. In return, the panels shield crops and soil from intense heat, reducing water evaporation and helping farmers maintain income on land threatened by drought.
The investment opportunity is expanding internationally. Research by the European Commission’s Joint Research Centre indicates that deploying agrivoltaics on just 1 per cent of Europe’s agricultural land could generate hundreds of gigawatts of capacity and hundreds of terawatt-hours of electricity annually. Greece has already outlined plans for 130 MW of agrivoltaic capacity. For capital markets, dual-use sites represent a mechanism to deploy capital at scale while neutralising the land-use conflicts that have historically capped solar growth.
