If the Scottish Government is to achieve its ambition of deploying 20 GW of onshore wind by 2030, the answer will not only lie with creating new wind farms, but repowering existing sites.
The generation of wind farms developed during the mid-to-late 1990s, as the nation began awakening to the power of wind energy, are nearing the end of their lives. Reports suggest that 2.5GW of operational wind farms will reach the end of their consented operational lifetime within the next decade.
Yet this may not necessarily mean the end of the sites on which they stand. While developers may apply to extend the life of some wind farms, there is significant potential to generate even more electricity from them through a process known as ‘Repowering’.
Repowering means replacing older turbines with new ones - often larger, sometimes fewer, certainly more efficient and with increased capacity - on the same site.
Planning permission for wind energy projects generally allows schemes to operate for 25 to 30 years. The generational change means we can expect to start hearing more about repowering as this existing generation of wind farms ages out.
It makes sense. Energy companies know they have good sites. There is an existing relationship with the landowner. Infrastructure, such as tracks and foundations, substations and grid connections are already in place, reducing construction disruption. The surrounding communities are used to seeing turbines. Advances in technology means turbines are likely to generate significantly more power which may give rise to opportunities to install - or add greater - battery storage capacity increasing revenue streams for landowners.
For landowners approached about such a move, a prudent first step is to revisit your existing agreement to review any clause about repowering and its implications.
As you enter into detailed negotiations, appointing a knowledgeable land agent, familiar with the market, to assist in negotiations will ensure that you are obtaining a fair deal at market rates. They may want to take the chance to review financial terms, perhaps based on new electricity generation forecast. How income is received from any potential scheme is also critical and arranging the most efficient tax vehicle with an accountant is essential for how any new agreement will be structured. In addition, landowners would be wise in ensuring that they retain the access rights required for any current or future operations on their land, including retaining rights to grant access to other developers.
We would suggest that strong, tailored, advice is needed to check the contractual aspects of your agreement to ensure it is fit for purpose, should repowering progress.
Like any new wind farm, the developer will be required to secure planning permission. Recent decisions flowing from NPF4 generally points to repowering being considered favourably due to the part it can play generally in the journey to net zero.
There may, however, be material changes to a repowered site that must be considered. For example, the tip height of the blades could be higher, which may trigger discussion about visual impact. The developer may want to reposition the turbines, particularly if there are fewer of them. That may even require them needing a larger parcel of land.
Consideration may also be needed as to how neighbouring landowners could be affected and what agreements may need to be put in place. Would the delivery of larger turbines and blades mean that access through - or affecting - their property would be needed, for oversail for example?
Developers will, of course, look to take the community with them and will be required to carry out a consultation as part of the planning process. They will hope that the principle of an existing development will carry weight and established community benefit programmes will have demonstrated how wind farms can support both the environment, along with people and projects in the area in which they stand.
From an individual business perspective, repowering - like any new renewables project - is an opportunity for landowners to examine how diversification is enhancing their enterprise, and to look at every impact of that, from revenues to tax.
It can secure your renewables income - and your continued part in responding to the climate emergency - for another generation.
Lewis Crofts is a Senior Associate in our Rural - Land & Business team in Edinburgh.
Published 30 September 2024. Featured in Scottish Land and Estates LandBusiness Autumn 2024 magazine.
