The quest for clean, renewable green energy is growing remarkably, positively impacting the economy. It is also an open investment opportunity for individuals and companies, particularly in the solar energy sector. But, like every other investment, you need to consider the risk and the return on investment (ROI).
Today, most green energy investors are getting government relief like the solar tax credits in the United States. Solar panel prices have also been decreasing, making it an excellent way of making more money without serious risk or huge startups.
Generally, solar farms are large installations of panels harnessing the sun’s energy and sending it to a power grid. Since the panels are ground-mounted over a large piece of land, it is called a solar farm. The energy generated can run several homes. For instance, in the U.S. there is over 100 GW of solar capacity generated, enough to power millions of homes.
Governments and businesses plan to embrace green energy fully in the next ten years. It is an environmental saving move to limit the greenhouse gas effect of fossil fuel burning. In such prevailing circumstances, investing in green energy companies such as solar farms will be lucrative in the coming years.
How to Invest in Solar Farms without Starting Your Farm
While a solar farm may sound like the ideal and most promising way of investing in green energy, there are still ways you can invest without starting your farm. To make money in a solar farm, you will need to sell the power generated to the grid at a profit. Also, understand the different factors at play which include,
- The farm’s location
- Land size
- Utility contracts
- Grid proximity
If the odds are against you, here are ways to invest without starting a solar farm.
Solar Farm Stocks
More energy companies are extending their services to provide green energy. The quest for such innovation has led many to establish solar farms. As an investor, you can invest through stocks. Some are large companies, while others offer solar penny stocks.
These stocks allow investors to get involved without starting a solar farm. While the prices of green energy stocks are relatively low, the surge in solar power demand gives it an excellent boost. The remarkable growth rate in this energy sector will make it one of the best investment opportunities in the years to come.
Indirect Solar Farm Investment
If you own a large land, you can hire or lease it to a developer or solar company to start a farm. But make sure you have a contract specifying the terms. Currently, leasing land to become a solar farm has a potential compound annual growth rate of about 20% up to 2027.
Solar Farm ETFs
Solar farm exchange-traded funds (ETFs) allow investors to participate in this green energy industry. The majority are solar technology companies that indirectly offer an excellent way to invest in solar farms. However, ETFs have high volatility. Therefore, invest cautiously.
Solar Income Funds
To achieve the green or renewable energy dream, the government needs capital. A solar income fund is an investment that allows you to invest money in government solar power schemes. This is another opportunity of making money from solar farms. Investors get a profit share earned from electricity production.
Renewable Mutual Fund
A renewable mutual fund is an investment option where you can infuse your money with other investors. The pooled money goes into different green energy projects, including solar farms. But it is recommended to seek assistance from a financial advisor. They will provide essential information on the best available opportunities.