Our coalition has conducted extensive research into commercial solar lease agreements used in Knox County and neighboring regions. What we've found is deeply concerning: these contracts are heavily weighted in favor of developers, often leaving landowners with little recourse and significant long-term obligations.
Solar lease agreements are complex legal documents with 30+ year terms. Have an attorney review any agreement before signing, and understand that the terms heavily favor the developer.
Common Problematic Terms
Broad Rights Granted to Developers
Many lease agreements grant developers sweeping rights over the property that extend far beyond what most landowners realize. These can include rights to access neighboring properties, authority to make decisions about land use, and broad indemnification clauses that protect the developer but expose the landowner to risk.
Limited Landowner Protections
While developers secure extensive protections for themselves, landowners often have minimal recourse if problems arise. Decommissioning bonds may be inadequate, there may be limited accountability for environmental damage, and enforcement mechanisms favor the developer.
Tax and Financial Implications
Lease agreements can have significant tax implications that aren't always clearly explained. Property tax reassessments, potential impacts on agricultural exemptions, and income tax considerations on lease payments all need careful review. Additionally, lease payments that seem attractive initially may not keep pace with inflation over a 30-year term.
What We've Learned from Other Counties
Through public records requests and research into solar projects in neighboring counties, we've identified several patterns in how these agreements are structured. Many include automatic renewal clauses, restrictive terms on future property use, and provisions that make it difficult for landowners to exit the agreement even if circumstances change.
Lease agreements examined from nearby counties show remarkable similarity in their one-sided terms, suggesting standardized contracts that prioritize developer interests over landowner protections.
Impact on Neighbors
What's particularly troubling is how these agreements can affect neighboring property owners who didn't sign leases. Adjacent landowners have no say in the development but must live with the impacts, including visual changes, potential property value effects, and altered community character. Yet they have no legal standing under these private contracts.
No Neighbor Protections
Unlike county ordinances which can establish setbacks and other protections, private lease agreements offer zero protection to neighbors. This is why strong county regulations are essential—they're the only mechanism to protect non-participating residents.
Questions to Ask Before Signing
If you're considering a solar lease agreement, here are critical questions to address with independent legal counsel:
- What exactly can the developer do on your property, and what restrictions exist?
- What happens if the developer sells the project or goes bankrupt?
- Who is responsible for decommissioning, and is the bond truly adequate?
- How are lease payments adjusted over time, and what happens during project downtime?
- What restrictions does this place on your future use of the property?
- Can you exit the agreement if circumstances change, and what would that cost?
- How does this affect your property taxes and agricultural status?
- What recourse do you have if environmental damage occurs?
- Are there any obligations that extend beyond the lease term?
The Role of County Ordinances
This research reinforces why strong county solar ordinances are so important. While private contracts govern the relationship between landowners and developers, county ordinances are the only tool to protect the broader community. Adequate setbacks, decommissioning requirements, environmental protections, and safety standards don't exist in private lease agreements—they can only come from county regulations.
Solar lease agreements are complex legal documents with long-term implications. Don't rely on assurances from solar company representatives. Get independent legal counsel, understand what you're signing, and recognize that once signed, these agreements are very difficult to change or exit.
Advocacy Impact
Our analysis of these lease agreements has informed our advocacy for stronger county ordinances. We've identified gaps in current regulations that leave residents vulnerable and have documented practices that need oversight. This research has been shared with county commissioners and planning officials as they consider ordinance amendments.
Transparency about these agreements is crucial. Knox County residents deserve to understand what they're signing and how these projects will impact the broader community. Strong county protections aren't anti-solar—they're pro-community, ensuring development happens responsibly with protections for everyone affected.