Iowa Farmers Find Wind Leases a Reliable Cash Floor When Crop Prices Fall
When commodity prices drop, Iowa corn and soybean farmers often face a brutal squeeze between production costs and market returns. But for some landowners, wind turbines have become a dependable financial lifeline, offering steady lease income even in the toughest farming years.
In 2016, Tim Hemphill, a corn and soybean farmer outside Milford, Iowa, collected about $20,000 a year from leasing land for wind turbines, according to the Omaha World-Herald. The figure, later repeated by the Advanced Power Alliance, highlighted a growing trend across the Hawkeye State: wind energy providing rural landowners with a predictable cash floor when crop revenue falters.
Why wind lease income mattered in 2016
The timing of Hemphill's wind income was crucial. In 2016, Iowa farmers faced a period of low commodity prices that left many struggling to cover production costs. Hemphill told the Omaha World-Herald that corn had once sold for about $7 a bushel, while his production costs ran about $4.20 a bushel. When market prices dipped toward or below those costs, crop sales alone were not enough to keep a farm profitable.
A wind lease works differently from a crop sale. The farmer does not harvest anything from the land occupied by the turbine. Instead, the energy company pays for the right to use the site for wind-energy infrastructure. The amount a farmer receives depends on the contract, the number of turbines, and their capacity. A U.S. Government Accountability Office review found that wind-farm lease payments varied considerably between projects and could reach tens of thousands of dollars a year for individual farmers.
For Hemphill, the reported $20,000 annual payment represented a relatively predictable addition to farm income at a time when crop revenue was much less certain. It was, in effect, a guaranteed paycheck in an industry where nothing else was guaranteed.
Farming continues beneath the turbines
One common misconception is that wind turbines render surrounding farmland useless. In reality, the land taken up by turbine foundations, roads, and other infrastructure is minimal, and farming continues on the rest of the property.
A 2021 report on Iowa farmer Kelly Nieuwenhuis illustrates the point. Nieuwenhuis had two MidAmerican Energy turbines on his farm, while the surrounding land remained in active corn and soybean production. The turbines' infrastructure covered about two acres, and the landowner also received lease income on top of his crop revenue.
Research has also examined what happens to farmland values when turbines are installed. A study in the Journal of Agricultural and Resource Economics found that lease payments were one factor that could affect the value of farmland hosting turbines, along with roads, turbine pads, and possible disruption to farming operations. Lease terms, infrastructure requirements, access, and the amount of land taken out of production all formed part of the economic calculation.
A different kind of farm revenue
Wind development has been important not only for electricity production in Iowa but also for farm economics. In 2015, Iowa generated 31% of its electricity from wind, the largest share among U.S. states. That year, Iowa farmers received millions of dollars in wind-lease payments.
According to a 2024 report on farm operations, 3.5% of farms received energy payments related to wind, oil, or natural gas, and those payments averaged more than $30,000 a year in 2020. For farmers like Hemphill, the benefit was even more direct: his profit from corn and soybeans might fluctuate with market forces, but his wind lease was guaranteed.
The turbines were not a replacement for farming but another business activity on the same agricultural land. The 2016 story reflected a broader trend across parts of the American Midwest: land could generate value not only from crops but also from wind leases.
What this means for Iowa's agricultural economy
For Iowa's farm families, the combination of crop production and wind leases offers a measure of stability in an otherwise volatile industry. When commodity prices fall, as they did in 2016 and again in recent years, wind income can mean the difference between breaking even and taking a loss.
Energy independence and agricultural prosperity are not competing interests in Iowa. They are complementary parts of a diversified rural economy. As wind development continues across the state, more landowners are likely to find that their land can work for them in more ways than one.
For farmers considering a wind lease, the key is understanding the contract terms, the infrastructure footprint, and the long-term impact on land value. But for those who have already signed, the steady stream of lease payments has proven to be a valuable hedge against the unpredictable nature of crop markets.
Frequently asked questions about wind leases for Iowa farmers
How much can an Iowa farmer earn from a wind turbine lease?
Payments vary widely depending on the contract, the number of turbines, and their capacity. In 2016, Tim Hemphill earned about $20,000 per year. A 2024 report found that energy payments to farms averaged more than $30,000 a year in 2020.
Can farmers still grow crops on land with wind turbines?
Yes. The turbine foundation, roads, and related infrastructure take up only a small portion of the land, typically about two acres per turbine site. The surrounding land remains suitable for corn and soybean production.
Do wind turbines affect farmland values?
Research from the Journal of Agricultural and Resource Economics indicates that lease payments, infrastructure requirements, and the amount of land taken out of production all factor into how turbines affect farmland values. The impact varies by project and location.