How to Start a Solar Farm in Arkansas


Setting up a domestic solar PV system is an excellent step towards a renewable future which requires a lot of research and investment upfront.

Arkansas located in the southern United States has long been recognized for its enormous natural resources, especially its vast potential for solar energy. Many people wonder – is Arkansas a good place for solar because of its sunny climate and large open spaces. However, the city has some advantageous schemes, and you can get more monetary benefits compared to other states. This indicates a great possibility; let us delve deeper and learn how to start a solar farm in Arkansas with its energy production.

Is Arkansas a Good Place for Solar?

Yes, solar is worthwhile in Arkansas. Installing an average-sized solar system can save you thousands of dollars over time if you pay cash upfront. If you finance your system with a $0 down loan, you can begin saving on day one in Arkansas, albeit your long-term savings will be lower. Moreover, there is currently adequate solar installed in Arkansas to power homes, and the state has spent millions of dollars on solar.

More Arkansas homeowners can now afford solar, owing to a drop in solar prices over the last ten years. Switching to solar would be a worthwhile decision and you can also save some extra bucks on your electric bills. In most regions, the cost of electricity, available incentives, the climate, and solar angle, will all affect how quickly you break even on your investment in comparison to other areas. Nevertheless, Arkansas receives an abundance of sunlight, and a domestic solar PV system can provide you with lots of electricity for your solar. The next pointer will tell you how to start a solar farm in Arkansas so keep reading.

How to Start a Solar Farm in Arkansas

After knowing whether Arkansas is a good place for solar, you must be wondering how to start a solar farm in Arkansas. Well, you are in the right place. Landowners in Arkansas can now take advantage of Federal Energy Regulatory Commission laws to become solar power owners by joining the setup of ground-based solar power plants in the state. The solar farm building is a simple process if you are provided with the appropriate information. The process of acquiring a solar PV system is as follows:

1. Determine Whether Your Property Qualifies as the Site of a Solar Farm

It all starts with a minimum of 14 acres of cleared level ground in a rural area in Branch, Arkansas. The land should be close to a utility substation and easily accessed from the major road, with no environmental zoning limitations.

2. Fill Out the Solar Farm Application to Provide Data about Your Specific Property

If you own at least 14 acres of cleared flat land in Branch, Arkansas, then you’re required to fill out the form available. Every field must be filled out, especially providing an image of your portion of land with the boundaries properly marked.

3. Arkansas Land Leasing Rates and the Amount of Energy Produced

Once the form has been reviewed and accepted, the next step is to determine how much solar energy can be produced by the property. The company will provide an in-depth report about the kWh of electricity your solar farm will generate every month. In addition, the utility will pay out on an annual basis depending on the power agreement with your local utility company.

Note: Speak with experienced installers in your area to obtain accurate quotations, compare those rates, and choose the best option; we recommend comparing at least three.

Also Read: How to Start a Solar Farm in Florida?

4. Engineers will Design a Solar Farm in Arkansas

One of the final tasks is to conduct an initial and detailed solar design based on the analysis of the solar farm you want to set up. Engineers utilize solar farm design software to lay out exactly the number of solar panels and execute a construction-ready solar design for your solar farm that will be built on your land. This report will also include additional metrics such as system performance, electrical line schematics, inverter specifications, and all other engineering specifics that may be provided by the solar business that will build the solar farm.

A reputable contractor can modify a solar PV system to your specific budget and requirements, and after you sign the contract, the installation process takes only three to four days. Let your contractor install the PV system and you then enjoy clean energy while helping the environment.

Cross-Reference: Notable Solar Installations in Arkansas

What if You install Solar Panels in Arkansas Utilising a Solar Loan?

JAN23 How to Start a Solar Farm in Arkansas

Since you are already aware of how to start a solar farm in Arkansas, and if you choose to set up a solar power plant using a home equity line of credit, you can expect a practically immediate positive cash flow. Due to the 30% investment tax credit that utilizes whether you bought the system in cash or with a loan, and if you already own the solar PV system, you can take advantage of the ITC benefit.

Therefore, the advantages of a solar loan in Arkansas include the initial 30% ITC and a rise in the market value of your house. However, the system’s lifetime cost will be the same as if you bought all of its output from the grid. If you are buying a home in Arkansas, think about adopting solar right now because the additional income flow from the ITC will help you make ends meet in the long run.

Furthermore, Arkansas also has net metering regulation, where the entire cost of any kWh exported to the grid gets a credit on the following month’s bill. This signifies that you save the whole cost of every single kWh of energy produced by your system, rather than just a fraction of the cost which is the usual practice among many other states’ electrical utilities.

The disadvantage of a solar loan is that you will be paying interest for several years. In other words, buying the PV system and obtaining all your electricity from the grid can cost you roughly the same amount.

Also Read: Is Solar Worth It in Colorado?

What is the Return on Investment for Home Solar Energy in Arkansas?

To better understand the project financials for a solar PV system in Arkansas, assume a 5-kilowatt system is built in an Arkansas home. For this system, you will probably have to pay more than around $21,000 upfront, which is comparable to $4.2 per installed watt.

However, by utilizing the available tax credits and factoring in the first-year savings, the year-one cost can be reduced to roughly $14,000. This equals $2.8 per installed watt, which is excellent for a home solar PV system when the installed cost is often in the $3 to $4 per watt range.

After learning how to start a solar farm in Arkansas, here is a breakdown of the expenses and savings associated with building a 5kW solar power plant in Arkansas:

  • The upfront cost of the residential PV system will be around $21,000. After deducting the federal solar tax credit of 30%, i.e. $6,300, the new estimate will be $14,700.
  • If you estimate you will save more than $600 in the first year, your net cost for the first year will be roughly $14,000. You should expect to see a return on your investment in about 18 years.
  • Because Arkansas has very low electricity prices $0.10/kWh on average, your property will improve in value, as will your net worth, and your payback term will be extended.
  • However, given that PV arrays have a normal service life of 25 years, you will still receive 7 years of free energy after the entire system has paid for itself.
  • Over the lifetime of the solar PV setup, you could expect to save more than $9000 in net savings. In addition to the obvious financial benefits of a PV system in Arkansas, consider you will significantly raise the value of your home.

Note: This is just a general scenario to give you an idea of the financial performance you can expect. Every project is different, and there are many factors to consider. These are rooftop orientation, natural or man-made obstacles that may cast shadows on your PV array, and location in the state of Arkansas.

This also calls us to answer the next question which is – does Arkansas have a solar access law? Read the next pointer to find out.

You can also take a look at the Solar Incentives and Rebates in Canada.

Does Arkansas have a Solar Access Law?

solar energy laws

Since you know how to start a solar farm in Arkansas, did you know it belongs to the list of some states that do not allow individual choice in how they finance their renewable generation? This regulatory burden is forcing Arkansas to miss out on a big portion of the solar market. The legislation aims to remove Arkansas’s ban on solar leasing and power purchase agreements, also referred to as 3rd party financing.

Arkansas does have a Solar Access Law. The Arkansas Solar Access Act of 2019 was passed to lift the state’s ban on solar leasing and power purchase agreements by highlighting the potential of solar farms in the branch of Arkansas specifically. The solar land lease provides landowners with substantial control over their energy consumption, as well as a unique opportunity to make a profit from the sale of energy generated on their land by a solar PV array.

In addition to a more liberalized energy market, landowners now have more authority over the financing of projects, solar land leases, and solar power purchase agreements. A path to better compensation for the energy generated on their land, owing to the act’s establishment. It aimed to remove major regulatory obstacles that had restricted Arkansas’s solar business for years; whereas this Act will more precisely focus on the:

  • Allow solar leasing as well as third-party purchasing for non-taxed enterprises, giving customers more options.
  • More than triples the maximum solar size limit for businesses, allowing them to capitalize on economies of scale more effectively.
  • Includes provision to offer market certainty, ensuring that consumers who adopt solar are shielded from future rate structure changes that would reduce the value of their investment.

Additionally, check out the 15 Reasons Why You Should Not Lease Your Solar Panels.

After reading the article, you must have understood how to start a solar farm in Arkansas. It can be a complex process, but remembering key points like careful planning, site selection, finance, permitting, and connecting with the electrical grid can make it a profitable investment in renewable energy. Since you have read the answer to whether Arkansas has a solar access law or not, it should also be clear to you how the law has helped in solar leasing and power purchase agreements, assisting many people in achieving consistent power expenses. 

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