EXHIBIT F Economic Report
APPLICATION TO THE OHIO POWER SITING BOARD FOR A
CERTIFICATE OF ENVIRONMENTAL COMPATIBILITY AND PUBLIC NEED FOR THE
Case No. 24-0801-EL -BGN
Potential Economic Implications of the
Grange Solar Grazing Center in Logan County, Ohio
Nyonho Oh and Brent Sohngen
Department of Agricultural, Environmental, and Development
Economics
Ohio State University
Draft: October 2 , 2024
Executive Summary
The Grange Solar Grazing Center is a proposed utility-scale solar energy facility to be developed on approximately 2,600 acres in Logan County, Ohio. With a planned capacity of 500 MW, the project aims to meet the region’s growing energy needs while contributing to Ohio’s shift toward renewable energy. In addition to generating clean energy, the project will create significant economic benefits for the local community, with only minimal impacts on agricultural activities.
This report evaluates the economic implications of the project, focusing on its effects on regional employment, tax revenue, and the agricultural sector. The goal is to provide stakeholders with the insights necessary for informed decision-making.
The report also addresses key requirements set by the Ohio Power Siting Board (OPSB), including:
1. Estimating the total annual payroll and present worth for both the construction and operational phases.
• The construction phase is expected to generate $70.7 million in labor income and $91.4 million in value-added for the region, with the total construction costs being $167.1 million (pp.11-12).
• For the operational phase, the total annual labor income is estimated at $641,745, contributing $1.7 million in value-added and $2.9 million in total economic output (p.12).
2. Assessing the number of jobs created during construction and operation, including projected regional hires.
• During the construction phase, 1,156 direct jobs are projected to be created. Additionally, indirect impacts will generate 157 jobs, and induced effects will add another 203 jobs, totaling 1,516 jobs during the construction phase (pp.11-12).
• For the operational phase, the facility is expected to support 10.8 direct jobs, with an additional 8 jobs generated through indirect and induced effects (p.12). Furthermore, on-site sheep grazing is projected to add 6 to 9 jobs (pp.21-22).
3. Calculating the expected increase in tax revenue at the county, township, and municipal levels.
• The project will provide substantial fiscal benefits through Payments In Lieu of Taxes (PILOT), estimated to reach up to $5 million annually over the facility's 40-year lifespan. The additional tax revenue will support local schools, fire services, and public institutions (pp.23-24).
4. Evaluating the economic impact on local commercial and industrial activities.
• The construction of the facility will contribute $91.4 million in value-added to local commercial and industrial activities. When including supply chain and income effects, the total contribution is estimated to be $122 million (pp.1112).
• The operational phase will provide continued benefits to local industries, with an annual contribution of $1.7 million in direct effects and $2 million in total effects (p.12).
By converting the farmland occupied by the project into solar and grazing fields, Grange will reduce Logan County’s cropland area by approximately 1.4%. Although the area of cropland will decline modestly, crop yields are expected to continue increasing 1% to 2% per year based on historical trends, mitigating any negative impacts on agricultural output. Additionally, the integration of on-site sheep grazing will support 5,000 to 7,500 ewes, generating between $489,750 to $734,625 annually in agricultural revenue, kickstarting a new industry for the region.
The overall economic impact of the Grange Solar Grazing Center, including the operation of the solar and grazing facility, changes in agricultural outputs due to land conversion, and benefits from on-site sheep grazing, is projected to result in a net gain of 15.23 to 20.40 jobs annually. Labor income is expected to increase by $2.5 million to $2.7 million, with valueadded rising by $3.1 million to $3.5 million, and total output growing by $2.5 million to $3.1 million. These contributions will significantly strengthen the local economy, complementing the project’s renewable energy goals.
In conclusion, the Grange Solar Grazing Center offers substantial economic benefits to Logan County, with limited impacts on agriculture. The integration of sheep grazing and financial incentives for local residents further enhance the project’s value, making it a significant contributor to both the local economy and Ohio’s renewable energy goals.
Introduction
Background Information on the Proposed Facility
The Grange Solar Grazing Center (“Grange ”) project is a utility-scale solar energy and grazing facility planned to be built on approximately 2,600 acres in Logan County, Ohio. The project aims to harness solar power to meet the region's growing energy needs, diversify Ohio's energy mix, and support the agricultural industry.
Overview of Objectives and Scope of the Report
This report aims to assess the project's economic implications, including its impact on regional employment, tax revenue, and the agricultural sector. The assessment will help stakeholders understand the project's potential economic implications, enabling informed decision-making.
Additionally, this report is designed to fulfill the Ohio Power Siting Board (OPSB) requirements. The specific responses to these requirements are outlined as follows:
1. An estimate of the total annual payroll and present worth for both the construction and operation phases of the project.
2. An estimate of the number of jobs created during construction and operation, including the projected number of regional hires from the.
3. An estimate of the increase in county, township, and municipal tax revenue accruing from the facility.
4. An estimate of the economic impact of the proposed facility on local commercial and industrial activities.
Regional Socioeconomic Profile
Population
Population in the region (defined as Auglaize, Hardin, Logan and Shelby counties) grew from the 1970s to the early 2000s, but has remained relatively stable since then (Figure 1). Hardin County has consistently had the lowest population, ranging between 30,000 and 33,000, and was the only county that did not experience population growth during this 50-year period. Shelby County has consistently had the highest population, peaking above 49,000 in the early 2000s before experiencing a slight decline. Auglaize County showed a notable increase until the mid-1990s, after which it stabilized around 46,000. Logan County’s population steadily increased until the late 1990s, followed by a plateau near 46,000. Since 2010, the population growth in all four counties has slowed, with Hardin and Shelby Counties experiencing slight declines, while Auglaize and Logan Counties have maintained relatively stable populations.
The labor force is the portion of the population employed in any given time period (Figure 2). Within the region, the labor force has been responsive to economic cycles, with notable
fluctuations corresponding to economic events driven by national or global forces that affected local businesses. Shelby County has had the largest labor force over the entire time period, peaking above 29,000 before the 2000s and then experiencing more pronounced fluctuations. Auglaize and Logan counties also showed significant variations, particularly around the early 2000s and the financial crisis period 2008-2010. Post-2010, the labor force in Auglaize, Logan, and Shelby counties has remained relatively stable. Hardin County experienced a different pattern from the other three counties, gradually declining from 1990 to 2024. There were minor fluctuations, like the other counties, but a consistent downward trajectory overall.
Total Population
Note. Data from U.S. Census Bureau via Data Commons.
Figure 1. Population in Auglaize, Hardin, Logan, and Shelby Counties
Auglaize Hardin Logan Shelby
Population in the Labor Force
Hardin Logan Shelby
Figure 2. Labor force in Auglaize, Logan, and Shelby Counties Note. Data from Bureau of Labor Statistics (bls.gov) via Data Commons.
Employment
Employment data by industry for the four counties, including both the estimated number of employees and their percentage of the total workforce within the respective county, is presented in Table 1. The manufacturing sector remains a critical component of employment in the region, particularly in Shelby County, where it accounts for 36% of the workforce, the highest among the three counties. Auglaize County also has a significant manufacturing presence at 34.8%, while Hardin and Logan Counties have 24% and 26.4%, respectively.
Educational services, health care, and social assistance sectors also employ a substantial portion of the workforce in the region, with employment at 20.4% in Auglaize, 22.3% in Hardin, and 19.5% in Shelby counties. Alongside manufacturing, these service sectors form a critical part of the employment landscape. Construction and retail trade sectors also play important roles across all four counties, reflecting their contributions to local economic activity. In contrast, public administration employs a small percentage of the workforce, particularly in Shelby County (2.2%), indicating a relatively lower emphasis on government employment than other industries.
Auglaize
Table 1. 2022 Employment by industry in Auglaize, Logan, and Shelby Counties
Note. Data from U.S. Census Bureau (2023), American Community Survey 5-Year Estimates
Unemployment rates in Auglaize, Hardin, Logan, and Shelby counties from January 1990 to October 2023 are shown in Figure 3. The similar trends across the four counties underscores the region's similar response to broader economic conditions. Key events such as the early 1990s recession, the early 2000s dot-com bubble burst, and the Financial Crisis of 20082010 are marked by spikes in unemployment rates. The most dramatic increase occurred during the onset of the COVID-19 pandemic in early 2020, with Logan County experiencing a peak in unemployment to 26.3%. However, the rapid post-pandemic recovery brought unemployment rates back to pre-pandemic levels by 2021. This rapid increase in
unemployment, followed by rapid re-employment highlights the resilience and adaptability of the economies in these counties.
Unemployment Rate
Figure 3. Unemployment rate in Auglaize, Hardin, Logan, and Shelby Counties
Note. Data from Bureau of Labor Statistics (bls.gov) via Data Commons.
Housing
The number of housing units in the region has remained fairly constant over the past decade (Figure 4). Logan County consistently has the highest number of units, maintaining a steady increase from approximately 23,500 in 2011 to nearly 24,000 in 2022. The relatively high number in Logan County is likely related to the tourism industry around Indian Lake. However, it is also a function of the number of households. According to the 2022 American Community Survey 5-Year Estimates, Logan County has 19,168 households, compared to Auglaize's 18,858, Hardin’s 11,640, and Shelby's 18,429. Shelby County experienced a gradual increase in units from around 20,000 in 2011, peaking in 2020, before experiencing a slight decline. Auglaize County exhibits a steady growth from approximately 19,500 units in 2011 to just under 20,000 by 2022. Hardin County has had the lowest number of housing units, around 13,000 units, with no significant changes over the years.
Auglaize Hardin Logan Shelby
Housing Units
Figure 4. Housing units in Auglaize, Logan, and Shelby Counties
Note. Data from U.S. Census Bureau via Data Commons.
Although Logan County has the highest number of housing units at 23,711, it exhibits the highest vacancy rate at 19.2%, indicating a significant portion of unoccupied units (Table 2). The high vacancy rate in Logan County, we believe, results from an abundance of rental units in the county due to tourism associated with Indian Lake. In contrast, Auglaize County has a relatively low vacancy rate of 5.5%, with 19,961 total housing units. Shelby County, with a median housing value of $174,200, leads in housing costs. At the same time, Hardin County trails with the lowest median housing value at $125,600. The median gross rent also varies, with Shelby County having the highest at $865 and Hardin County the lowest at $755. These figures suggest that Shelby County's housing market is the most expensive, while Hardin County is more affordable but experiences a relatively high vacancy rate. Overall, there is a diverse range of housing market dynamics across the four counties.
The development of the project will have a minor impact on the housing market, given the number of vacant housing units and the limited amount of land it will use. Much of the influx of labor will be short-term, primarily during the construction phase. Longer-term labor needs for operation and maintenance are relatively minimal. The influx of labor forces, due to construction in particular, could help reduce vacancy rates but slightly raise rents by occupying some of the vacant units. However, this is unlikely to alter the overall housing stock.
Auglaize Hardin Logan Shelby
Table 2. Housing characteristics in Auglaize, Logan, and Shelby Counties, 2022
Note. Data from U.S. Census Bureau (2023), American Community Survey 5-Year Estimates.
Economic Impact Analysis
Methods
This section outlines the methodology used to assess the economic impacts of the Grange Solar project. The primary tool for our analysis is the IMPLAN model, a well-established input-output modeling system designed to evaluate the economic contributions of development projects across various sectors. IMPLAN allows us to estimate both the overall economic impact and the specific implications for agriculture. Our analysis focuses on the economic contributions to the four-county region, including Logan, Hardin, Auglaize, and Shelby Counties. We used Multi-Regional Input-Output (MRIO) analysis to capture the broader regional impacts of the project. It is assumed that the electricity generated by the project will meet new demand within Ohio’s PJM market without displacing existing energy sources.
The IMPLAN model provides a comprehensive view of the project's economic impacts, including direct, indirect, and induced effects. These effects unfold gradually as the project integrates with the local economy, captured through IMPLAN’s multiplier effect. This reflects how spending in sectors like construction circulates through the economy, generating additional economic activity.
While IMPLAN is the main analysis tool, the Jobs and Economic Development Impact (JEDI) photovoltaics model (version PV05.20.21), developed by the National Renewable Energy Laboratory (NREL), serves as an auxiliary tool. The JEDI model is specifically tailored to estimate the economic contributions of solar-powered electricity-generating facilities. We used JEDI to provide localized spending estimates based on the project’s construction and operational phases, which were then incorporated into IMPLAN to enhance the accuracy of our regional economic evaluation. The JEDI model operates under the assumption that
materials and equipment are manufactured outside the region, while labor is sourced locally.
Facility -specific data inputs
The analysis utilizes facility-specific data provided by Grange, along with utility-scale photovoltaic operation and maintenance costs from the National Renewable Energy Laboratory (NREL, 2020). These inputs were used in JEDI to generate estimates of project costs, tax payments, and statewide cost shares, which were then fed into the IMPLAN model:
• Project Location: Logan County, Ohio
• Year of Construction: 2026
• System Application: Utility-Scale
• Capacity: 500 MWAC and 701 MWDC
• Module Material: Crystalline Silicon
• System Tracking: Fixed tilt
• Base Installed System Cost: $740/kWDC
• Annual direct Operation and Maintenance Cost (O&M): $5/kWDC
• Money Value (Dollar Year): 2024
In addition, we updated hourly wage rates for construction and O&M labor using the most recent data from the U.S. Bureau of Labor Statistics (2023):
• Construction Worker Hourly Wage: $23.46
• O & M Hourly Wage: $30.31
These facility-specific costs and wage data were incorporated into the JEDI model to estimate project costs, tax payments, and statewide cost shares. JEDI’s estimates are derived from over a decade of research conducted by NREL, including interviews and surveys with leading project owners, developers, and construction firms active in the solar energy sector. By incorporating JEDI's detailed spending estimates into IMPLAN, we ensure a more precise and regionally relevant economic analysis.
Construction Phase
For the construction phase, $167,088,884 of the total construction costs is expected to be spent within the region, including installation labor, business overhead, and other related expenses 1. As shown in Table 3, which reflects the economic impact on Logan, Auglaize, Hardin, and Shelby counties, IMPLAN predicts a direct impact of 1,156 jobs, generating
1 JEDI estimates that $185,654,316 of the total construction costs will be spent in Ohio, including installation labor, business overhead, and other related expenses. Assuming 90% of this local spending remains within the region, $167,088,884 is entered into the IMPLAN model to estimate the economic contribution of the project’s construction phase.
$70.7 million in labor income, $91.4 million in value-added, and $167.1 million in total output.
The project's indirect effects are estimated to create 157 jobs, resulting in $7.5 million in labor income, $16 million in value-added, and $30.5 million in output. Induced effects, driven by increased household spending, are expected to add 203 jobs, producing $7.9 million in labor income, $17.7 million in value-added, and $31.6 million in output. In total, the construction phase is projected to support 1,516 jobs, generate $86.1 million in labor income, add $125 million in value-added, and produce $229.3 million in total economic output across the four- county region.
Table 3. Estimated economic impact on Logan County during construction (IMPLAN analysis)
Operational Phase
For the operational phase, $2,902,140 is expected to be spent within the region. As shown in Table 4, the direct impact from onsite labor is projected to create 10.8 jobs, contributing $2,341,106.43 in labor income. The increased demand for local suppliers and service providers is expected to generate an additional 0.56 jobs, resulting in $32,515.43 in labor income. Additionally, the rise in household income due to new jobs and earnings will induce 7.51 more jobs, generating $291,521.59 in labor income. In total, the operation of the facility is expected to create 18.87 jobs during the operational phase, resulting in $2,665,143.44 in labor income. The total value-added is estimated at $3,338,898.83, and the total economic output is projected to be $4,273,936.09.
Table 4. Estimated economic impact on Logan County during operation (IMPLAN analysis)
* We assumed 10 direct hires based on real time data on an operation project in Ohio provided by Grange.
Impact on Local Commercial, Industrial and Agricultural Economic Activities
Assessment on Local Commercial and Industrial Activities
Effects on local commercial and industrial activities are illustrated in the IMPLAN analysis presented in tables 4 and 6 above. Construction of the facility will contribute $91 million to local commercial and industrial activity locally. When local supply chain and income effects are counted, the total contribution is estimated to be $122 million to the local economy. The continuing benefits of the operation to the local economy are $1.6 million annually in direct effects, and $2 million annually in total effects.
Assessment of Regional Trends in Agricultural land, Crop Yields, and Other Farm Outputs
The total area of agricultural land in the four-county region stood at 896,012 acres in 2022 (U.S. Department of Agriculture National Agricultural Statistics Service (USDA-NASS), 2024). Since 1997, agricultural land area has declined by 25,643 acres, or 2.8% (Figure 5). The largest decline happened in Logan County, followed by Hardin County. Auglaize and Shelby Counties, by contrast, experienced increases in total agricultural land area from 1997 to 2022.
Cropland is a subset of the agricultural land area, typically containing the most productive acres. While the total area of agricultural land declined, the area of cropland in the four counties increased from 1997 to 2022 by 22,718 acres, or 2.9% (Figure 5). Logan County experienced a reduction in cropland, equal to 14,174 acres over the period 1997 to 2022, while the cropland area expanded in the other counties. Losses in Logan County resulted from development and conversion to non-agricultural uses.
Pastureland and woodland represent more modest uses of the land in the region, with pastureland in 2022 amounting to 14,723 acres, or 1.6% of the total agricultural land. Pasture use has declined dramatically in the last 25 years, falling by nearly 60%. Similarly, woodland in 2022 encompassed 34,032 acres, a 40% reduction from woodland area in 1997. Pastureland and woodland have declined in each of the counties. Some pastureland and woodland have likely been converted to cropland, explaining how cropland has expanded even as total agricultural land has declined.
Agricultural Land
Figure 5. Area of agricultural land (cropland, pastureland, woodland, and other land) in fourcounty region
Note. Data from USDA-NASS (2024), Census.of.Agriculture.
The strength of the agricultural economy in this region is tied to the acres harvested in the main crops – soybeans, corn, and wheat. In 2022, the acres harvested for these three crops amounted to 89% of the total cropland reported in the agricultural census in the four counties, while acres harvested for the three crops amounted to just over 90% of the total cropland in Logan County (USDA-NASS, 2024). Furthermore, the area of land devoted to these three crops has increased in the past 30 years, rising 10.8% in the four counties from the early 1990s (1990-1994) to the most recent period (2020-2023; 2019 excluded due to extreme spring rainfall and low acres planted and harvested) (Figure 6). This 30% increase in corn acres and 21% increase in soybean acres happened as wheat, other crops, pastureland, and woodland have all declined.
cropland pastureland woodland other
Auglaize Hardin Logan Shelby
Area Harvested
Figure 6. Area of harvested acres of soybeans, corn and wheat in the four- county region. Note. Data from USDA-NASS (2024), Census.of.Agriculture.
The strength of the agricultural economy is also tied to crop yields, which rose handsomely in the last 30 years, continuing trends observed since early in the last century. In Logan County, corn yields rose 55.2%, soybean yields rose 44.1%, and wheat yields increased 47.3% from the early 1990s to the present (Table 5). When combined with changes in how the land was used – an increase in harvested acres devoted to corn and soybeans with a decrease in acres devoted to wheat – total output increased 68.1% in corn, 108.5% in soybeans while declining 51.6% in wheat.
Table 5. Change in corn, soybean and wheat area harvested, crop yields, and output in Logan County, Ohio over 30-year period from early 1990s to early 2020s.
Note. Data from USDA-NASS (2024), Census of Agriculture.
Corn Soybeans Wheat Sum
Acres
Corn Soybeans Wheat
Similar trends are observed across the four-county region. Output of corn and soybeans rose, while wheat output fell (Figure 7). However, the total output for the three crops rose by 69.5%. The largest increase happened in Shelby County and the smallest in Logan County. Underlying land-use trends in Logan County have led to a reduction in agricultural land area, including cropland, over the last 30 years. Nonetheless, farmers have moved land into the most valuable commodities – corn and soybeans – increasing output in both those sectors even as the cropland base has diminished.
Soybeans take up the largest amount of land, with harvested soybean acres accounting for 49% of total cropland acres. Corn accounted for 35% of harvested acres, and wheat 4 %. The remainder of the cropland – about 11% – was either not harvested or planted for another crop type. The share of soybeans has steadily grown in recent decades at the expense of wheat and other crops.
Given these trends, the conversion of farmland occupied by Grange to solar and grazing will have a modest and short-term impact on both acres and output in the region. The approximate 2,600 acres represent 1.4% of the total cropland in Logan County and 0.3% of the total cropland in the four-county region. Suppose all these acres are derived proportionally from the three main crops in the first year. Corn output will decline by 195,940 bushels, soybean output will fall by 81,186 bushels, and wheat output will fall by 7,979 bushels. This loss will amount to 1.4% of Logan County's output of each crop, and 0.4% of the region's output of corn, 0.3% of the region's output of soybean, and 0.3% of the region's output of wheat.
The underlying trends also imply that the shift of Grange’s acreage from row crops to the solar and grazing facility is unlikely to cause a temporary or permanent reduction in the area devoted to corn and soybeans or their output. The trend of the last 30 years has been that cropland used for other crops, pastureland, and woodland has shifted to corn and soybeans. Even in Logan County, where total cropland declined from 1997 to 2022, the area of corn and soybean harvested increased.
Generally, yield gains have blunted any short-term losses in corn or soybean area planted. Yield increases for corn have averaged 1.6% per year over the last 30 years, 1.1% per year for soybeans, and 2.0% per year for wheat. After deducting the loss of land to solar electricity production, the remaining cropland in Logan County will produce an additional 194,586 bushels of corn, an additional 56,517 bushels of soybeans, and an additional 10,122 bushels of wheat each year as a result of yield increases. Just within Logan County, gains from yield improvements can offset the losses in land use from the solar facility. We expect yield improvements to continue at a similar pace over time, implying outputs will continue to increase in future years.
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
Figure 7. Harvested quantity of each crop in each county, 1997-2022.
Note. Data from USDA-NASS (2024), Census.of.Agriculture¡
Crops Usage in Region
A large share of corn and soybeans produced in the United States are exported or used for energy production, meaning that the local food economy will experience limited to no impact from the movement of cropland into solar and grazing uses. Since 2020, 36.1% of corn has been devoted to ethanol production in the United States, and 15.5% has been exported to other countries (Figure 8). Of the corn directly consumed in the United States, 80% (39% of total US production) is used as feed for livestock. The remaining 20% is consumed directly, used for seed, or other industrial uses.
Bushels
Corn Soybeans Wheat
US Corn Use
Figure 8. U.S. corn use
Note. Data from U.S. Department of Agriculture Economic Research Service (USDA-ERS) (2024), Feed.Grains. Database¡
Soybeans have similar disposition, with 46% being exported directly (Figure 9) and 52% being crushed and converted to soybean oil and meal. The remaining 2% is consumed directly. About 27.1% of soybean meal is exported, while only about 5% of the soybean oil is exported. An increasing share of soybean oil in recent years has been used for biofuel (renewable diesel) production, amounting to 40.7% of total soybean oil production since 2020. These estimates suggest that about 20% of the total soybean harvest in recent years has been devoted to energy consumption, while 55% or so is exported.
US Soybean Use
Panel A: Soybean oil from Domestic Use. Panel B: Soybean meal from Domestic Use.
Figure 9. US Soybean Use. When harvested soybeans are either consumed, crushed, or exported. When crushed soybeans are converted to oil (Panel A) and meal (Panel B) Soybean oil is used in food production, and increasingly in biofuels, such as renewable diesel.
Note. Data from USDA-ERS (2024), Feed Grains Database.
It is not possible to break exports and use statistics at the county-level. State-level statistics compiled by the USDA-ERS assume that each state's export share is proportional to its production share, suggesting that county shares can be similarly determined. Based on
these national estimates, we calculate that 52% of corn production and 75% of soybean production in the four-county region is exported or used in energy production. For the United States as a whole, soybean and corn represent the two agricultural products with the greatest export value, amounting to $52 billion in 2022 and $40 billion in 2023. Mexico, China, Japan, and Canada are the top trading partners for most products (USDA-ERS, 2024). The production of these crops plays an important role in the local food supply chain up to the point that the corn, soybean, or wheat leaves the farm, but once products leave the farm, far more than half of the output is destined for uses in these and other countries or in the energy sector.
Despite the importance of energy and exports, some corn and soybeans are used locally as feed in the animal sector. The most recent 2022 Agricultural Census reports 87,752 head of cattle in the four-county region, up from 66,437 head in 2002 (USDA-NASS, 2022). There has been a much larger increase in the inventory of hogs, rising from 371,980 hogs in 2002 to 674,550 in 2022. Chicken production in the four counties has declined substantially, standing around 48,000 layers and broilers in 2022 (USDA-NASS, 2024).
With a limited area of pastureland, animal production in the four-county region is reliant on inputs composed mostly of feed made from corn and soybeans. According to the USDA ERS Feed Grain Database (USDA-ERS, 2024), corn represents greater than 90% of the energy feed used by animals, and soybeans represent 83% of the oilseed meal rations used in the U S. Shifting approximately 2,600 acres of cropland into the production of solar power will have little to no measurable impact on prices for feed inputs that local farmers see.
In contrast, there is considerable evidence that the production of renewable fuels from corn and soybeans increases crop prices, which in turn increases the costs of feed rations for livestock producers (National Research Council, 2011). Some of these higher input costs are transmitted to output prices, but the higher costs also reduce margins for livestock producers. Schmidt et al. (2009), for instance, calculated that each $1 per ton increase in the price of corn increases feed costs of $0.47 to $0.67 per ton for chickens, hogs, and dairy cows.
Assessment of Potential Impact of Solar and Grazing Facility on the Value of Agricultural Outputs.
The average farm size in Logan County was 209 acres in 2022 The average total agricultural product sales per farm was $202,474 in 2022 (USDA-NASS, 2022), suggesting an average gross farm revenue of $969 per acre per year. Assuming approximately 2,600 acres of the land proposed for the solar and grazing facility are converted from these crops, gross farm sales could decline by $2.5 million per year. However, 2022 had relatively high crop prices compared to other years in the recent past due to the start of the war in Ukraine. Using average prices from the last five years – prices that are lower than those in 2022 – if all the
land used for the solar and grazing facility comes proportionally from corn, soybeans, and wheat, the average lost gross revenue per acre for Logan County is $750 per acre or $1.96 million per year across the acres converted to solar panels.
However, individual landowners who choose to enter into long-term solar leases are compensated for lost crops through production rents that are substantially higher than the income generated on per-acre basis from row crop farming.
Table 7 presents the estimated economic loss resulting from the conversion of agricultural lands to solar facilities. The direct impacts include a loss of 8 jobs, a reduction in labor income by $328,220, a decrease in value-added by $534,408, and a drop in output of $1.96 million. Indirect impacts, which arise from the reduced demand for goods and services from related industries, show a loss of 3 jobs, a decrease in labor income by $108,121, a reduction in value-added by $232,729, and a decline in output of $570,873. Induced impacts, resulting from decreased spending by those directly and indirectly affected, include a loss of 1 job, a decrease in labor income by $48,047, a reduction in value-added by $107,501, and a drop in output of $192,321. Overall, the total estimated economic loss from this conversion includes a loss of 12 jobs, a reduction in labor income by $484,388, a decrease in value-added by $874,638, and a decline in output of $2.72 million.
Table 6. Estimated economic loss from converting agricultural lands to solar facilities
Implication of on-site sheep grazing
Livestock grazing, particularly with sheep, offers ecological and economic benefits in managing vegetation under solar panels. Sheep can effectively manage weed growth while also providing additional revenue streams for herders. The careful timing of grazing can support native plant growth and help establish pollinator habitats. However, other livestock, such as cows and goats, may not be suitable due to potential equipment damage (NREL, n.d.).
On the proposed project site, a sheep grazing operation is planned to be conducted on approximately 2,600 acres, supporting 5,000-7,500 ewes, a stocking rate of 2-3. Assuming the gross return per ewe is $97.95 (Duffy and Morrical, 2010; Munns et al., 2016; University of Wisconsin-Madison Extension, 2023), net returns after accounting for variable input costs plus a 14% of gross revenue charge for machinery and buildings will be $2.14 per ewe, or
$21,140. Grange has advised that it expects to pay $250-500 2 per acre per year as a vegetation management fee, which will help ensure the profitability of this large animal operation. This fee will amount to an additional $641,750 - $1,283,500 in income per year for the animal operation.
Using IMPLAN, we show the contribution of this animal operation in Table 8. The contribution is based on the total output of $97.95 per ewe per year, or $489,750-$734,625 per year. The additional income of the $250-500 per acre for the grazing fee is not included in this analysis so as to avoid influencing the employment and value-added calculations as contributions to the agricultural industry.
The additional grazing fee, however, will stimulate induced effects by increasing consumption due to the added income. This is expected to generate 2-4 jobs, contribute $79,135-$158,270 in labor income, $177,330-$354,659 in value added, and $317,264$634,529 in total output.
Table 7. Estimated economic impact of sheep grazing
Direct 5.66 - 8.49
Indirect 0.13 - 0.19
Induced 0.57 - 0.85
$183,040.12$274,560.18
$5,395.06$8,092.59
$397,076.42$595,614.64
$489,750.00$734,625.00
$10,566.57$15,849.85 $22,130.63$33,195.95
$22,004.15$33,006.23 $49,272.80$73,909.20
$132,228.93 Total 6.36 - 9.53
$210,439.33$315,659.00 $456,915.79$685,373.69 $600,033.25$900,049.88
Total Impact on Local Economy
By aggregating the economic impacts of operating the solar and grazing facility, changes in agricultural outputs due to the land conversion from farmlands to the solar and grazing facility, and benefits of on-site sheep grazing, we can assess the overall economic impacts, including employment, labor income, value-added, and output, categorized into direct, indirect, and induced effects.
Table 9 presents the estimated annual net economic impact of operating the solar and grazing facility, based on the IMPLAN model. The estimates account for the loss of agricultural output while incorporating gains from on-site sheep grazing and grazing-related land management fees. The direct impact of the facility’s operation is projected to support between 8.46 and 11.29 jobs, contributing $2.2 million to $2.3 million in labor income and
2 This range is subject to change and is based on estimates provided by Grange. The annual grazing fee paid by the project to the grazer will be negotiated and will depend heavily on the final project design, including factors such as the availability of electricity, water, fuel, and access to gates, barns, and other essential infrastructure.
adding $2.5 million to $2.7 million in value-added. Additionally, total output is expected to range from $1.4 million to $1.7 million.
Indirectly, the operation is estimated to result in a loss of 2.25 to 2.31 jobs and a decrease in labor income by $67,513 to $70,211. Value-added is projected to decrease by $126,262 to $131,545, along with an estimated reduction in output of $334,480 to $345,545. Induced impacts, driven by increased local consumption, are expected to generate an additional 9.08 to 11.36 jobs, producing $344,614 to $434,751 in labor income, $772,620 to $974,585 in value-added, and boosting output by $1.4 million to $1.7 million. Overall, the operation of the facility is projected to result in a net gain of 15.23 to 20.40 jobs, with labor income increasing by $2.5 million to $2.7 million, value-added rising by $3.1 million to $3.5 million, and total output growing by $2.5 million to $3.1 million.
Table 8. Estimated annual net economic impact of operation of solar and grazing facility minus loss of agricultural outputs plus gain from on-site sheep grazing (IMPLAN analysis)
Direct 8.46 – 11.29 $2,195,926.36$2,287,446.42
Indirect (2.31) - (2. 25) ($70,210.74)($67,513.21)
$2,457,432.03$2,655,970.25
$1,431,890.00$1,676,765.00
($131,545.16)($126,261.88) ($345,544.97)($334,479.65) Induced 9.08 – 11.36 $344,614.09 - $434,751.17 $772,619.64 - $974,585.04 $1,381,693.86 - $1,743,035.17
Total 15.23 – 20.40 $2,470,329.70 - $2,654,684.37 $3,098,506.52 - $3504,293.42 $2,468,038.89 - $3,085,320.52
Note: The impact ranges are driven by two factors - the number of sheep grazing and grazing-related land management fee ($250-$500)
Fiscal Impact
The Current Agricultural Use Value (CAUV) Program
Ohio’s Current Agricultural Use Value (CAUV) program allows farmland to be taxed based on its agricultural value rather than its market value, providing tax relief to farmers. Currently, the estimated taxes for the agricultural land included in the Grange project under CAUV are $57,302 annually.
Payments In Lieu Of Taxes (PILOT)
In Ohio, solar energy projects may be exempt from tangible personal property and real property tax payments if they meet certain conditions. Instead, operators of these energy projects are required to make annual payments in lieu of taxes (PILOT). To qualify for such payment structure, a project must satisfy specific criteria established the state
In this case, Grange is proposing annual PILOT payments in the amount $10,000 per MWAC. Given the facility’s maximum capacity of 500 MWAC, the annual PILOT payments will total $200 million over the facility’s 40-year lifespan (Table 10).
Table 9. Annual total payments in lieu of taxes
Townships* (Washington, Stokes, Richland, Bloomfield, McArthur)
Stokes
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