Proposed Act Blocks Federal Funds and Tax Credits for Solar Projects on 'Prime Farmland'

The “Protecting American Farmland Act” is a piece of legislation that aims to draw a hard line between agriculture and solar energy development, specifically on the nation’s best soil. In short, this bill makes it significantly harder—and more expensive—to build solar energy projects on land classified as “prime farmland.” It does this through a two-pronged approach: cutting off federal funding and stripping away major tax incentives.

The Federal Funding Firewall

Section 2 of the bill creates a major hurdle for large-scale solar projects. It flat-out prohibits any Federal agency from using taxpayer money—whether it’s a direct grant, a loan, or a loan guarantee—to fund a "covered solar energy project" if that project involves the "conversion" of prime farmland. A covered solar project is defined as a ground-mounted facility designed mainly to generate electricity for sale. This means if a developer wants to put up a utility-scale solar farm on your state’s highest-quality agricultural land, they can’t use federal assistance to do it. The goal here is clear: preserve the most productive soil for growing food, not generating power.

Stripping the Solar Tax Breaks

The most impactful part of this bill is how it rewrites the rulebook for tax credits, which are currently the engine driving renewable energy development. Sections 3 through 7 amend the Internal Revenue Code to exclude solar projects built on prime farmland from receiving almost every major federal energy incentive. This isn't a small thing; these credits are often the difference between a project being financially viable or dead in the water.

For example, if you were planning to install solar panels on a large piece of property that happens to be designated as prime farmland, you would lose access to the residential clean energy credit (Sec. 3). For commercial developers, the bill removes eligibility for the renewable electricity production credit (Sec. 4), the clean electricity production credit (Sec. 5), the general energy credit (Sec. 6), and the clean electricity investment credit (Sec. 7). These exclusions apply to projects placed in service after the bill becomes law.

What This Means for the Real World

If this bill passes, it forces developers to look elsewhere for their projects, which is the point. For a farmer in Iowa or California with highly productive land, this bill ensures that land is worth more as farmland than as a solar site subsidized by the government. It’s a win for food security advocates who worry about losing top-tier agricultural land to development. The flip side, however, is that it raises the cost and complexity of deploying renewable energy. Solar developers often seek out large, flat, easily accessible tracts of land, which frequently overlaps with what’s classified as prime farmland. By eliminating these major financial incentives, the bill could slow down the pace of solar deployment in certain areas.

For consumers, the long-term impact is a trade-off: you might see better protection for food production, but potentially face higher energy prices or a slower transition to renewable power if developers are forced to build on less ideal, more expensive land. The core challenge for implementation will be the precise definition of “prime farmland,” which relies on existing federal and state standards. Any ambiguity in those definitions could lead to costly disputes over whether a specific piece of land qualifies for the exclusion—a detail that could make or break a multi-million-dollar project.