AGRIVOLTAICS
Agrivoltaics business plan: financial model and returns
Practical guide · ~9 min read
Agrivoltaics combines electricity generation and agricultural activity on the same plot. Its business plan reuses the framework of a solar business plan, with three specifics: a higher structure CAPEX, a dedicated regulatory framework, and the synergy with farm income.
1. The regulatory framework
Agrivoltaics is regulated to maintain a genuine agricultural production and to provide a service to the plot (climate protection, shading, etc.). The business plan must therefore include agricultural compatibility (ground coverage ratio, height, spacing). Exact terms evolve — check the rules in force in your country.
2. Generation and structures
Elevated panels, on trackers or vertical: the configuration affects the yield (P50/P90) and the CAPEX. You model the yield as for PV, accounting for losses linked to the agricultural geometry.
3. Revenue
- Tender / feed-in premium (supported, indexed tariff).
- PPA (see our guide on the solar PPA).
- Maintained farm income (often outside the energy SPV, but presented for the project's coherence).
4. CAPEX, OPEX and land
The CAPEX per MW is higher than ground-mount PV (tall structures, foundations, trackers). OPEX adds maintenance compatible with farming. Land is often secured by a lease with the farmer (rent or value sharing).
5. Financing and returns
Financing follows the logic of project finance (senior debt + equity, sized by gearing or DSCR). You compute the IRR, NPV, DSCR and LCOE to judge returns.
6. The agricultural synergy, a risk asset
The financial particularity of agrivoltaics is that the maintained farm income and the service to the plot (shading, protection against climate hazards) reduce the project's overall risk and ease local acceptability. Even when carried outside the energy SPV, this agricultural component appears in the file: it conditions regulatory eligibility and reassures financiers on the durability of land use. Conversely, a project seen as "disguised energy" can be refused — a regulatory risk to model like a schedule risk.
7. Estimating returns
Returns are computed as for PV, increasing the CAPEX per kWp to reflect the elevated structures. For a first order of magnitude, use the solar ROI calculator, adjusting CAPEX and yield. For a full, consolidated model, see the photovoltaic financial model.
FAQ
What sets an agrivoltaic business plan apart?
The dual use: the plot produces both electricity and an agricultural activity. The financial model therefore adds a higher structure CAPEX (elevated panels or trackers), a service link to the farmer, and sometimes revenue sharing — on top of the usual building blocks of a solar BP.
How is an agrivoltaic project remunerated?
Mainly through tenders / a feed-in premium, or a PPA. Regulatory frameworks require maintaining a genuine agricultural activity on the plot; exact terms evolve and should be checked against the rules in force in the relevant country.
Is agrivoltaics more profitable than ground-mount PV?
Not mechanically: CAPEX per MW is higher (structures, height), but tariffs and land access can be more favourable, and the maintained farm income reduces risk. It all depends on the site and the sizing.
How is the land secured in agrivoltaics?
Most often through a long-term lease between the project company and the farmer (and/or landowner), providing a rent or value sharing. The strength and duration of that lease are scrutinised by lenders, as they underpin the durability of operations over the whole project life.
Does farm income enter the energy business plan?
Not directly if it stays with the farmer: the energy SPV models the electricity flows. But the agricultural side is presented in parallel, because it conditions regulatory eligibility and reduces the perceived risk of the project as a whole.
PUT IT INTO PRACTICE
Build this business plan in Wattvalio.
P50/P90 generation, offtake contracts (feed-in, PPA, merchant), debt, taxes, NAV valuation — from a single asset to the consolidated portfolio, with bankable figures.
Or estimate returns with the free calculator →Read also: Solar business plan · Self-consumption · ROI calculator