In our last article, we explored the benefits that leasing land for renewable energy can bring to landowners.
From diversifying your land usage to securing a long-term, stable income and more, working alongside a renewable energy developer to build a renewable site can be an advantageous choice – especially while the demand for suitable land for these developments is at an all-time high.
If your land meets all the requirements for a renewable site, you may have already been approached by a developer expressing an interest.
If this is something you are keen to pursue, there are some considerations you’ll need to make before kick-starting the process – all of which we have shared below.
Before leasing land for renewable energy, ask the interested developer these nine questions:
1. Why are you interested in my land in particular?
This is a great starter question, as it will help you to identify whether the developer has done their desktop research.
Among other factors, the developer should have investigated land suitability from a planning perspective (including heritage, landscape and amenity, ecology and environmental designations, access, and agricultural land quality).
Most importantly, however, they should have identified a viable grid connection. Without that, even the best land from a planning perspective won’t be eligible for a renewable development.
2. How much will I be paid for leasing my land?
As mentioned above, leasing land for a renewable development provides an opportunity to secure a long-term, stable income. It’s important to establish what you can expect to receive – particularly if you are approached by multiple developers – so you can make the best choice for you.
3. How does the process work from start to finish? What level of involvement will you need from me?
The renewable energy land development process (which we’ll be discussing in more detail in a future article) comprises several different steps and stages.
A developer should be able to explain all of these stages to you, such as engaging with your professional advisors regarding the contracts, or how they intend to approach the planning process.
Perhaps more importantly, the developer should explain how involved you will need to be, and the support they will provide you along the way.
4. Are there any fees I will have to pay as part of the development?
As a landowner, you should not be asked by a renewable developer to pay any fees towards the development, including funding of the planning application or site construction.
Typically, all pre-agreed professional costs, such as surveyor fees or legal costs, will be covered by the developer.
5. Will I be able to continue with my agricultural practices?
Another benefit of having a renewable development on your land is that you can retain certain agricultural practices, such as livestock grazing. However, this may not always be the case, depending on the size of project the developer wants to build, so it’s important to ask the developer whether this will still be possible.
This is important not only for land and income diversification, but as there may also be tax implications – for example, if you can no longer use the land for certain agricultural practices, this might affect your claim to Agricultural Property Relief (APR).
6. Will any other parts of my land be affected by the project?
As a renewable development is made up of more than just, for example, solar panels or energy storage units, it’s essential to ask how other parts of your land might be affected by the renewable development.
It may be that ancillary infrastructure, such as underground cabling, is required to facilitate the proposed grid connection. Once a design for the renewable development has been created, your developer will be able to discuss this with you in more detail and will form part of the legal documents.
7. What happens to my land at the end of the lease/development?
A renewable energy development typically operates for around 40 years, after which it is decommissioned. With such a long operational period, it’s important to know what kind of condition you can expect your land to be in afterwards, so you can plan for its future use.
The answer you’ll be looking for is that your land will be restored to its original condition. Plus, as shared in our last article, solar installations can even improve the quality of your land.
8. Will I be responsible for maintaining the development? If not, who?
You as the landowner should not be required to carry out maintenance work on the renewable development once it has been built and is operational.
This will either be carried out by the developers’ own operations management team, or a third party – although if you do spot anything concerning, it’s essential to raise this with the developer so that it can be dealt with quickly.
You will only be responsible for maintaining the land that isn’t included as part of the development.
9. What is your company’s track record for renewable energy developments?
For a renewable project to succeed, its essential that you choose the best possible developer to work alongside. Among other things, the right developer for you should be able to:
- Provide information on the projects the business currently has that are operational, have been granted planning permission, or are in the planning stages.
- Discuss the process and assessments that led them to finding your land.
- Share case studies or testimonials from landowners they have worked with on current and previous projects.
- Demonstrate similar core values to your own, particularly regarding positively improving the environment and supporting your local community.
- Clearly explain how the renewable development process works from start to finish and the benefits it will bring.
- Reassure you that they will work in close partnership with you at every stage.
With the answers to these questions, you’ll be in a strong position to decide whether to lease your land for renewable energy.
You’ll also have the information you need to decide if the renewable developer that approached you will be the best partner to work with on the project.
In our next article, we’ll be exploring the renewable energy development process for landowners in more detail.
In the meantime, you can find out more about this and other helpful information about leasing your land for a renewable energy development in The Landowner’s Guide to Renewable Energy Developments.
Get the guide here
Author: Michael Allworth, Land Director