Optimising onshore wind agreements

As we heard last week that the Scottish Government has granted Section 36 consent for ambitious battery storage plans at Whitelee Wind Farm, we consider ways in which onshore wind developers can ensure that agreements with landowners allow for the maximum potential of their projects to be realised.

Scottish Power has been given the go-ahead for a giant 50 megawatt battery facility at its 215-turbine Whitelee project near Glasgow. Ensuring continuity of supply to the grid by storing electricity when wind speeds are strong and releasing it when wind speeds drop means less wind is "wasted" and is seen as key to countering one of the main criticisms of renewable energy generally, which is that it is not always available when it is required. Batteries can also release short micro bursts of power to fill in fluctuations in generation allowing developers to really maximise the output from a project.

It perhaps goes without saying that the underlying land agreements with landowners need to provide for the incorporation of batteries or other forms of storage by the developer; otherwise it could be back to the negotiating table to try to introduce this, with more savvy landowners looking to maximise their own return on any uplift associated with storage. Ensuring that provision is made for this at the outset is crucial to allow the most to be made of this progressing technology.

There are a number of other aspects developers can consider trying to incorporate at the outset to future-proof their land agreements. The obvious example is making provision for repower capacity at expiry of the term. Any repower requires a fresh planning permission, of course, so does not by any means sink or swim solely on the terms of the agreement with the landowner, but at least ensuring that that agreement is permissive, where this can be negotiated, leaves the door open. There are issues with agreeing the rent, often having to leave this to a "fair rent at the time"-type mechanism, which is far from ideal but gives a developer something to hang its hat on rather than starting that negotiation afresh.

Other suggested ways of maximising future potential (and these may also apply to other technologies) are ensuring that agreements facilitate delivery of larger turbines, should the need arise, in the event of repower, providing for shared grid connections with other projects (including with other technologies), and providing for project extensions in the future, together with ensuring that landowners are obliged to enter into the supporting servitude and other legal agreements necessary to accommodate any upgrade in grid connection and transmission requirements as a result. One eye must also be had on any ancillary land agreements with access and cabling landowners whose benefit may be restricted to a certain defined area or capacity.

Overbuilding is also something to consider in the future. Quite aside from the fact that windfarms do not always operate at full capacity, the metered output capacity can be significantly less than the rated capacity due to inherent losses (wake losses, downtime and cable losses, amongst others) with the result that the grid connection is sometimes being under-utilised. Overbuilding would "fill up" the grid connection, but there are planning and other contractual considerations to bear in mind here.

Scottish Power’s battery is expected to be up and running by the end of 2020 and we understand that similar installations are proposed for a number of other Scottish Power projects.  Maximising renewable resources will be key in hitting climate change targets, and getting the most out of land agreements has a part to play in helping developers to do that.

MacRoberts advises on all aspects of renewable energy projects, including wind, hydro, solar and energy from waste. To find out more, please contact a member of our team.

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