Solar Farms and Agriculture: What UK Landowners Need to Know in 2025

Agricultural estates across the UK are reassessing how land is used. Solar farms have moved from a novel idea to a mainstream option that can underpin estate income for a generation. The opportunity is significant, but so are the variables. Grid capacity, planning risk, tenancy position, and the strength of your lease terms all shape the outcome. This guide sets out the practical questions landowners should ask before they sign and explains how independent consultancy helps secure a fair deal.

Why solar farms appeal to landowners

Hosting a solar farm can deliver a regular, predictable income for up to 40 years. Payments are commonly index linked, which helps preserve value over time. Operating costs are low for the landowner because the developer funds, builds, and manages the asset. Alongside the financial case, there are reputational and environmental gains. Generating local clean power reduces the estate carbon footprint and supports regional energy resilience.

First checks: does the land suit development

Developers look for flat or gently sloping sites with strong solar resource and limited visual impact. Proximity to existing infrastructure can help from a planning perspective. Screening potential through planting and natural features is often beneficial. The technical filter is stricter. Viable projects need an achievable grid connection, a workable route for cabling and plant, and confidence that planning conditions can be met.

• Grid connection – Is there local capacity and a realistic connection timeline. Connection cost and curtailment risk can affect viability.
• Access and routing – Can heavy vehicles reach the site and can you lawfully route the primary cable to the substation.
• Title and rights – Check for restrictive covenants, overage clauses, and third-party mineral rights that allow entry.
• Public rights of way = Understand how footpaths and bridleways interact with layout and fencing.

Tenancies and control of the land

Where land is tenanted, timing and permissions become central. Developers will need to undertake surveys and ground investigations before planning is submitted. Confirm what your tenancy allows and where consents are required. Regaining possession for construction can take time. Farm Business Tenancies usually require at least twelve months notice. Agricultural Holdings Act tenancies can be more complex. Early, transparent engagement avoids surprises and informs realistic programme dates.

Heads of terms and lease provisions that protect value

Heads of terms set the commercial foundation for the option and lease. They are not usually binding, but once signed they are difficult to move. Care at this stage prevents costly renegotiation later. Key items include:

• Indexation – How and when payments increase over the life of the lease.
• Cordon sanitaire – The buffer around the site where planting or development may be restricted. Keep this as tight as is sensible.
• Access routes and easements – Define corridors and reinstatement obligations from the outset.
• Substation and compound siting – Fix locations and visual mitigation where possible.
• Assignment and step-in – Expect the lease to be assigned after build. Ensure the estate is protected whoever operates the asset.
• Restoration obligations – Secure a restoration bond or equivalent security so the land is returned to agreed condition at end of life.
• Professional fees – Confirm that reasonable landowner costs are met, including planning input and legal review.

Self-build or lease to a developer

Smaller projects that sit on farm buildings or limited ground mount can be self-built to serve on-site demand with export of surplus. Larger grid-scale sites usually favour a lease model. The capital requirement, grid process, and construction risk are substantial. A lease transfers these to a developer that has the team and balance sheet to deliver. Either route can be valid. The right choice depends on your objectives, risk appetite, and the character of the site.

Choosing credible counterparties

Developers vary in capability and approach. Look for a clear track record, evidenced delivery, and transparent communication on grid status and planning strategy. Be cautious of headline rents that assume optimistic timelines or unproven connection routes. Independent due diligence helps test assumptions and align expectations before options are signed.

What changes on the ground

Solar farms are fenced and monitored, with access tracks, inverter stations, and a substation compound. Grazing can continue where layouts and animal welfare allow, which helps maintain land condition. There will be periods of activity during construction and grid works. Agree reinstatement standards and responsibilities for any damage to retained land. Think long term about how the scheme interacts with existing rights of way, drainage, and future estate plans.

With consultancy vs without consultancy

The table below summarises the difference in approach that landowners typically experience.

Typical timeline

Once an option is agreed, developers seek planning permission and a grid offer. Construction usually follows one to three years after option signature, subject to grid milestones and planning conditions. Setting realistic expectations at the outset helps everyone plan around farming activities and cash flow.

How Arc Renewables helps

Arc supports farmers and landowners with independent, RICS-aligned advice from feasibility through to heads of terms and delivery oversight. The team works with a network of experienced investors and developers across Europe, which helps test market assumptions and secure fair, bankable terms. The objective is simple. Protect the estate, unlock value, and leave options open for the future.

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