Solar Farm Agreements in NSW: What Landowners Should Know Before Signing

A letter arrives, or a representative knocks on the door. A renewable energy company has been looking at your country, and they want to talk about putting solar panels on part of it. The numbers they mention can sound very good, often better than the land has earned from cropping or grazing in years. For a farming family, that is a tempting thing to hear. But the decision in front of you is much bigger than one good season. You are being asked to commit a piece of your land, and a piece of your family’s future, for the next thirty or forty years. This is not just a legal issue. It is a legacy issue. Before you sign anything, it helps to understand how solar farm agreements in NSW actually work, and what you are really agreeing to.

Why the offers are landing in your mailbox

Governments have set big targets for renewable energy, and NSW has mapped out Renewable Energy Zones to make it happen. One of the largest sits across the Central West, taking in country around Dubbo and out our way. Developers are looking for large, flat, cleared blocks that sit close to the power lines that carry electricity to the grid. A lot of good farming country fits that picture. Leasing the land, rather than buying it, suits them too. It keeps the title in your name and spreads their cost over time. That is why the offers are arriving, and why they are arriving now.

How a solar farm agreement in NSW is usually put together

Most deals come in two stages, and this is the part many landowners miss. First, you are asked to sign an option agreement. That is a promise that gives the company the right to take out a lease later, often after a few years of studies and approvals. During that option period you might receive a smaller yearly payment. The lease itself comes second. The trap is that the option usually sets the terms of the lease in advance. By the time the lease is triggered, the important decisions have already been made. The first document you sign is the one that locks you in, not the last.

What the payments really look like

Solar rent is often set per hectare, or sometimes tied to how much power the project produces. On paper it can look simple and generous. The detail is where it matters. When does the rent actually start, during construction or only once the panels are running. Does it rise each year, and by how much. Is it reviewed against the market over a long lease, or fixed in a way that falls behind. How is GST handled. Steady income across decades can be a real benefit for a farm, but you need to compare the whole picture, not just the headline figure.

How it changes the way you farm the land

Land under and around the panels usually comes out of normal production. Some agreements allow sheep to keep grazing between and beneath the panels, which can work well, but only if it is written clearly into the lease rather than promised in conversation. There are also practical questions about fencing, weed and pest control, fire risk and biosecurity. Think carefully about how the leased block sits within the working farm, and whether the rest of your operation still hangs together once that country is tied up.

Access, easements and the infrastructure that comes with it

A solar farm is more than panels. It needs access tracks, a substation, and power lines that connect it to the grid. Those connections often run through an easement, which is a legal right for the company to use a strip of your land. An easement can cross paddocks well beyond the leased area, and it can sit on the title long after the lease itself has ended. Construction also brings heavy traffic for a year or more. It pays to know exactly where everything will go, who maintains it, and who carries the risk if something goes wrong.

The approvals are not your job, but they shape your deal

Large solar farms in NSW are usually assessed by the State as significant developments. That process looks at planning, biodiversity, neighbours and how the site will be cleaned up at the end. The approval can change what the company first promised you. A good agreement deals with this honestly. It should set out what happens if approval is refused, or if the conditions of approval change the project in a way that affects your land.

Thinking past your own time on the land

A forty year lease will outlast some of the people sitting at the table to sign it. So the end matters as much as the beginning. Who removes the panels and restores the soil when the lease finishes, and is that promise backed by a bond or guarantee you can actually rely on. If the farm is mortgaged, your bank will usually need to agree before you can sign. And the lease and any easements will pass down with the land, so they need to fit your succession plans rather than work against them. The next generation will inherit whatever you agree to today.

One family’s experience

A farming family from the Central West came to see us after signing an option agreement. A representative had described it as just a formality, so they had not had anyone look at it. When we read it through, the option locked them into a lease on terms they had never actually seen, and it included a power line easement that ran straight across their best cropping paddock. We were able to step in before the lease was triggered. We moved the easement to the boundary, secured a proper guarantee for removing the panels and restoring the land at the end, and built in fair rent reviews. The family still hosts that solar farm today. The difference is that it now sits on terms that protect the farm for the children, not just the company.

From uncertainty to clarity

A solar agreement can be a genuinely good thing for a farming family. Steady income, the land kept in the family name, and a working farm that helps power the region. But the offer in front of you was written by the company’s lawyers, for the company. The earlier you get your own advice, the more room you have to shape the deal around your family and your land, rather than fitting your family around the deal. From uncertainty to clarity. That is the work worth doing before you sign.