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What happens to a solar farm at the end of its life?

Updated

General information, not a substitute for the advice of an attorney.

Short answer: At the end of its useful life, a solar farm is usually either repowered with new equipment or decommissioned and removed. In Texas, leases signed on or after September 1, 2021 must make the developer responsible for removal and back that duty with financial assurance (SB 760).

Repower, extend, or remove?

NREL lists the end-of-life options. An owner can keep operating, refurbish, repower "with new PV modules and inverters," or decommission and remove all the hardware (NREL, 2021). NREL adds that to "abandon in place" is not acceptable to landowners and regulators (NREL). Repowering can keep your land in use longer than first planned, so the lease's extension terms matter. See how long solar panels last.

What does Texas law require?

  • Who it covers: Utilities Code Chapter 302 applies only to solar agreements entered into on or after September 1, 2021 (SB 760).
  • Removal: the lease must require the developer to remove panels, transformers, substations, and overhead lines. Foundations and buried cables must come out to at least three feet below the surface (Tex. Util. Code § 302.0004).
  • Restoration on request: if the landowner asks, the developer must remove its roads. If reasonable, it must also remove large rocks, return land to a tillable state, and reseed pastureland with native grasses. The request is due within 180 days after the later of two dates: when the facility can no longer generate electricity in commercial quantities, or when the landowner receives written notice that the developer intends to decommission (§ 302.0004).
  • Financial assurance: at least the estimated removal and restoration cost minus salvage value (not counting salvage pledged to lenders), due by the earlier of the lease ending or the 20th anniversary of commercial operation (§ 302.0005).
  • Recycling (2025): HB 3228 covers agreements entered into on or after September 1, 2025. It requires reusing or recycling all components "practicably capable of being reused or recycled, including the photovoltaic modules," and proper disposal of the rest. It also adds recycling and disposal costs to the assurance estimate (HB 3228).

Full details are in our guide to Texas decommissioning law.

Where do the panels go?

The EPA says some panels are hazardous waste and some are not, even within the same model. The difference is whether lead or cadmium leach in a required test (EPA). In October 2023, EPA announced a rulemaking on end-of-life panels; its page says it is developing a proposed rule to add panels to its universal waste rules, so check the current status (EPA). EPA notes that recycling saves landfill space and captures the value of raw materials (EPA), but DOE says U.S. recycling generally still costs more than landfill disposal (U.S. DOE). For health questions, see are solar panels toxic?

Questions to ask

  • When was the lease signed: before September 1, 2021, before September 1, 2025, or after? That decides which rules apply.
  • Can the developer repower, and does that extend the lease?
  • What form of financial assurance will you provide, and can it start before year 20?
  • Will you remove roads and reseed? Put requests in writing within the 180-day window.
  • Related: what if the company goes bankrupt or sells?

General information from the sources linked above, not legal, tax, or financial advice.

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