How to Secure Land for a Wind Farm Investment as a Developer
|Topic: New wind farm projects||Read Time: 8 mins|
|Landowner type: Site Operator||Energy:|
Are you wondering how to secure land for a wind farm investment as a developer? Join us as we run through everything you need to think about before signing a contract with a landowner.
Have you been trying to find out everything you need to know about how to secure land for a wind farm investment as a developer? Well, you’re in the right place. This detailed rundown will cover initial research, getting a solid commitment, avoiding disputes, and everything in between. We’ll be the first to say that mutual respect and communication are key if you’re figuring out how to secure land for a wind farm investment as a developer.
But if you’re looking to go above and beyond, keep reading. There might just be a few hidden gems in this in-depth article that you hadn’t considered in your current action plan.
Things to Think About When Trying to Secure Land for a Wind Farm Investment
1: Planning permission and research
When you’re figuring out how to secure land for a wind farm investment as a developer, the first thing you’ll need to do is decent research. After all, diving into a new wind farm project is no easy feat and requires a LOT of planning.
To start with, you’ll want to make sure planning permission can be obtained for the site (and this can be extremely challenging. From our 2023 research, we uncovered that just 20.8% of local authorities had allocated suitable areas for wind development. To add to this, between 2016-2022, only 16 wind farms were built in the UK vs. 435 between 2011 and 2015.
These poor figures are largely down to the fact that:
- Turbines must be located in an area identified as suitable for wind energy in a local or neighbourhood plan
- The planning impacts identified by the local community need to have been fully addressed and the proposal would need their backing
As you can imagine, meeting both of these carefully worded policy requirements is incredibly difficult.
How can you improve your research?
In our experience, doing your research is vital when it comes to securing the right site. We advise starting with a list of wind farm projects that have been neglected or decommissioned in the past. These can often act as “hidden gems” or fixer-upper-type sites that can turn a decent profit with a bit of investment.
It’s also worth looking for sites that are up and running but are at the end of their contracts. For these projects, investment will be lower and you can offer the landowner a more favourable sum to take the site over. The only thing you’ll need to think about is one-upping their current developer’s offer to secure a decent deal for both parties. Failing that, you can investigate whether there’s land around the wind farm that could be used.
As the existing site would already have obtained planning permission, the chance of a neighbouring site being approved is far higher. So, whether you approach the same landowner or their keen neighbour, it’s worth investigating. But if we’re being honest, investing in a site with existing planning permission will be far less of a headache in the early stages.
2: Try and get a solid commitment from a landowner
After you’ve established a list of possible sites, the next step in securing land for a wind farm investment as a developer involves getting an option agreement written up and signed for a specific period. During the option agreement’s lifetime, you’ll be able to carry out further check on the viability of a project. This involves everything from securing planning permission to financing the project.
Although you may have a good relationship with the landowner in question, you will need to go above and beyond at this stage. And that’s largely because there may be several developers vying for the same site. If you’re not able to offer the landowner an appealing set of terms, you may well be outbid.
3: Respect the land
We’re often asked about underrated things that can be done if you’re trying to secure land for a wind farm investment as a developer. And our advice is to thoroughly RESPECT THE LAND. Now, this is more of an issue to consider later on in the process once the “deal is done”. But respecting land from the very beginning of a lease will set you in good stead for the entire contract.
Based on the landowners we’ve spoken to over the years, almost every single one has had a bugbear about respect. Whether that relates to trampled farmland or leaving gates open, showing basic appreciation and respect for the land is common courtesy.
To avoid any unnecessary confrontation, it’s worth expressing to the landowner that you understand that the land is their livelihood. To show how serious you are about this, ask them about previous issues they’ve had before your offer. This way, you can avoid repeating them in the future and keep your relationship on excellent terms.
4: Go local and have a community focus
It’s one thing to appeal to a landowner by promising to engage with their local community. It’s another to stand out as a project developer if you’re figuring out how to secure land for a wind farm investment as a developer. Many landowners have strong ties to their local community, and offering to use smaller businesses can go a long way. For example, if you’re working with a Scottish landowner, hiring Scottish contractors from the local area can show a vested interest in the community.
Equally, if you’re communicating with a Welsh landowner, a signoff in Welsh can be a small gesture that can go a long way. We also highly recommend getting on a first-name basis with any prospective landowners from the get-go. This way, you can show an interest in them as a person and show that you’re not just in it for the money. Plus, having a good project developer/landowner relationship means that you’re more likely to resolve disputes amicably if they occur. Not only can this save you money if issues arise, but it’ll avoid any transcendence into chaos.
If you can, try to give landowners a say in how money from the project is spent. Keeping them abreast of the project’s progress is one thing, but offering to start a community fund is going the extra mile. Whatever you do, keeping open lines of communication is crucial.
5: Avoid disputes by having open communication
Speaking of open communication, actively involving landowners in decisions can work wonders. One of the easiest ways to do this is by having a dedicated person representing the developer to answer any queries. Treating the landowner as a person instead of a money-making project is essential for success in our book. Not only will this make day-to-day reporting and operations easier, but it can even work to your benefit.
We recently spoke with a landowner who offered to build and maintain access roads for a small fee. By helping him feel more a part of the project and its daily operations, trust was easily developed between landowner and project developer. After all, this isn’t just a tenancy you’re trying to establish – it’s a long-term partnership.
6: Gauge their opinions on current developers or project developers
We’ll be honest with you. There isn’t much point in trying to convince a landowner to move away from their current project developer if they have a good thing going. So, it’s important to gauge the relationship between both parties before throwing your hat in the ring. But if a landowner is coming to the end of a current contract and isn’t overly happy with their operator?Well, you’ll be in a strong place to present a case that ups their current offer.
You’ll need to check that the site is high-yield enough to justify an additional investment on your end. And you can do this by assessing the site’s income and output until this point in time. If the landowner isn’t biting after your initial offer (but seems tempted) you can add a sweetener to the deal. Although this might come in the form of a bonus payment, transferring Grid connection rights can also be a great idea. This way, they’re free to do with the connection as they please once the project is decommissioned. Plus, being connected to the Grid is a huge selling point to future developers because it can take years to get and very expensive.
7: Offer to arrange access visits
One of the best ways for a landowner to make additional income from a wind farm project is by organising access visits. But landowners often don’t have the time (or will) to organise these visits on their own. Access arrangements to sites for educational purposes are typically popular with local schools. And if you can offer to participate and assist with a few trips a year, you could easily improve your project developer-landowner relationship. Not only will this boost income for the landowner, but it’ll show them that you genuinely care about showcasing the project. In other words, it’s a real win-win.
8: The importance of reputation and the management of existing projects
For project developers with existing projects, a strong reputation can be the difference between scoring a new project and losing it. If you have a previous history of turbines going down or excessive maintenance being required, it can change a negotiation. And although maintenance checks won’t secure the land, REPUTATION MATTERS.
If you’re approaching landowners of neighbouring projects and you have a poor reputation in the community? Well, you may have to do some convincing to get a landowner to sign up with you.
Landowners talk and build strong connections with each other on forums (and in person). And as bad news travels fast in these circles, it’s important to keep your profile squeaky clean. So, as a project developer, you must manage and monitor the turbines with a site operator as much as you can. And if you’re strict about regular checks, your bottom line (and the landowner’s) is far less likely to be affected.
Securing the land for a wind farm as a project developer isn’t the easiest thing to accomplish. But one of the best ways to get what you want is by levelling with landowners and understanding their gripes. In short, building a good and genuine relationship with the landowner is the way to go.
Oh, and you can’t beat open communication and having a local-first approach when approaching the landowner. To make your project as fruitful as possible, it’s always worth sweetening the deal with bonus payments. However, we feel that the personal side of things is far more likely to clinch you the deal than a large payment. If you’re looking for advice on how to secure land for a wind farm investment as a developer, get in touch. Our expert team will be more than happy to guide you based on our many years of experience with landowners.