Factors Affecting the Adoption of Wind and Solar-Power Generating Systems on U.S. Farms: Experiences at the State Level

Excerpts from the Executive Summary: The study is the first to examine the role of State-level policies such as net metering and Renewable Portfolio Standards (RPS), as well as the role of electric cooperatives, on States’ adoption rates of solar and wind systems on U.S. farms. The study found that States with higher energy prices, more organic acres per farm, and more Internet connectivity adopt renewable electricity at higher rates. For solar systems, full farm ownership and solar resources also have a significant and positive relationship with adoption rates. RPS targets are found to increase renewable electricity adoption at the State level. Our result accords with the literature; however, this is the first study to show an impact at the distributed-generation scale. Our study does not find a systematic relationship for State financial instruments, such as rebates, grants, investment tax credits, and production incentives, at least in the form captured by our policy variables. Similarly, net metering and interconnection policies do not seem to influence renewable electricity adoption at the State level. Conversely, electric cooperative prevalence in the State is found to have a negative relationship to renewable electricity adoption share. The interaction of those factors highlights the importance of coordinating approaches in policy formulation to meet Federal and State objectives of increasing renewable energy adoption.