simplified solar to revitalize rural economies

Instead of competing with agriculture, SunFarmor modules will catalyze its profitability by affording farmers a way to earn carbon-free commodity price premiums. As 2030 approaches, buyers in conventional, non-GMO, and organic markets will need to fulfill the demand for carbon-free food and feed. 

To date, farmers have struggled with monetizing carbon sequestered in their soils because of questions of additionality, measurement, and verification in carbon markets. When farmers collocate SunFarmor modules with containerized energy storage and hydrogen/ammonia plants, they will earn carbon-free price premiums backed by objective criteria that are easily verified and audited.   Ethanol producers in the Corn Belt are already paying price premiums for corn with reduced carbon intensities (CI). The California Air Resources Board’s Low-Carbon Fuel Standard committed California to reduce the state’s transportation fuel CI by 20% by 2030. Consequently,  ethanol producer POET paid a $42 per acre premium for corn with 20 percent CI reductions in 2021. 

Extrapolating that premium to a 100 percent CI reduction for carbon-free corn means farmers could earn a $210 per acre premium. This premium reflects a 33% increase for Corn Belt farmers growing corn at 205 bu/acre beyond a base price of $3.61/bu. Food and feed companies making Scope 3 commitments must rely solely on upstream farmers to reduce their greenhouse gas emissions, creating a compelling profit opportunity for farmers. According to AgFunder, 78% of food companies with commitments made them since 2019. That trend will likely continue as 2050 approaches.  Cargill alone stores 348 million bushels of grain in 196 facilities. By 2030, they’ve committed to storing the equivalent of 100 million bushels of carbon-free grain or the annual output of over 500 farms with a thousand carbon-free acres. Likewise, General Mills will need to purchase the equivalent of over 300 farms with a thousand carbon-free acres of wheat annually by 2030 to meet their commitment.  Even conventional farmers, unmotivated by environmental threats, will be able to identify the profit opportunity of carbon-free farming. 

If current carbon-intensity premiums for ethanol hold, most farmers will break even in the first year while earning ROIs above 50%. Any farmer will break even in four years while realizing an 18% return on investment (ROI), even if every renewable subsidy disappears except a 10 percent federal Investment Tax Credit (ITC). Since that rate of return is more than the historic return of owning farmland (12%), any farmer can redirect capital usually spent on land to earn more in a carbon-free practice. 

Early movers are likely to see higher returns, especially when commodity prices spike with fossil fuel costs. Unlike organics, buyers of carbon-free grain will not need to segregate the material in separate bins but only maintain a chain of custody preserving its identity. While some critics declaim green premiums, one delivered to farmers to decarbonize the food system is a marginal investment. Farmers currently earn only 7.6 cents of every food dollar spent in the US. With its Value-Added Producer Grants, the USDA has been promoting strategies for farmers to earn price premiums.
When modeling SunFarmor grower returns over 30 years on 1,000 acres, crop yield and price premiums overshadow other variables, including the capital cost of equipment, since the multiplier impacts revenue every year.