Preparation key for green developments Debbie Dewar

renewables: Developers should seek advice on plans at early stage

Despite the decline of the value of Feed-in-Tariff payments and availability of other subsidies, investment in wind, solar, hydro and other renewable technologies in Scotland is set to grow.

Over half of Scotland’s electricity came from renewable sources last year and this should increase with the falling cost of upfront expenditure particularly in wind and solar.

As technology develops, the storage of excess electricity generated will make projects even more viable.

We rely on renewables and investment in it is here to stay.

As rural business lawyers, we are increasingly asked to advise on new schemes.

Timing is critical, due to the availability of grid connection and the eligibility to receive set tariff rates or other incentives.

Delays can cause projects to become economically unviable and, from our perspective, preparation is key.

An initial check of your title deeds can highlight restrictions which could prejudice your project at a later stage.

Are there any enforceable title burdens restricting development?

Do you have all of the necessary access rights and do those rights extend to heavy construction vehicles?

Will you need to lead cables over neighbouring land?

If you plan a hydro scheme, do you have all of the necessary water rights?

Who else has rights to that water and will their consent be required?

Salmon fishing proprietors affected may be able to object to any alteration in the flow of water and could seek a court order to stop a hydro project operating.

Pursuing a renewables project can give tax planning opportunities but also bring disadvantages.

Income tax needs to be considered as well as the availability of tax reliefs.

The most appropriate “vehicle” or business model can be created to carry out the project.

Land can be transferred before the value of it increases as a result of planning permission being granted.

However, the availability of business property relief and agricultural property relief could be lost, as could agricultural subsidies.

Construction and procurement contracts should be checked.

You are not necessarily obliged to accept standard contract terms but, if you do, get advice on the risks.

Ensure that any defects are remedied and consider a contract that guarantees ongoing maintenance and servicing, particularly for expensive and complex machinery.

Appropriate warranties should also be obtained as inadequate warranties can de-value your system.

Check your ability to obtain insurance and the cost of that insurance.

Despite the initial cost, renewables have been proven to benefit individuals, businesses and communities.

However, the key to an ultimately successful project is proper groundwork from the outset.