Farmers and landowners should be aware of ‘rogue’ solar energy developers looking to lease land, warns consultancy Carter Jonas.
A drop in government financial incentives for solar PV projects across the continent had led to developers from Germany and Italy, in particular, offering UK landowners “below-market” terms for developing solar schemes, said the company.
“Negotiating an agreement which meets the interest of solar PV developers and landowners is a complex business,” said head of the Carter Jonas energy team Andrew Watkin.
“A lack of appreciation of a landowner’s position by rogue developers offering what appears to be a quick-fix scheme could leave the landowner exposed in the longer term.”
Common issues reported in such offers included unjustifiable option agreement periods which tied up the land for unnecessarily long periods of time – option agreements are typically for 12-24 months and should only be extending if planning permission or grid connection is awaited, he said.
In addition, poorly worded clauses could leave the landowner financially liable to fulfil some of the planning conditions and/or allow the company to automatically renew the lease at the end of the term. Landowners were advised to avoid automatic renewal and ensure the lease was excluded from the provisions of the Landlord and Tenant Act 1954 in terms of the occupiers’ security of tenure of the site and right to renew the lease, said Mr Watkin.
“A scheme that has been brought to our attention recently has tied three neighbouring landowners into a three-year exclusivity arrangement by a developer, in order that a fourth parcel of land could be developed further down the line,” added Mr Watkin.
“Unrealistically high rents were offered to the landowners involved in the exclusivity agreement, with the developer having full knowledge that the projects would not be built-out and, in turn, rentals to the landowners would not materialise.”
Mr Watkin advised farmers and landowners to always seek independent professional advice before signing up to any solar schemes, to ensure they optimised the potential of their land.
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