A-J Monro sees a bright future for those considering committing land to renewable energy, but urges taking proper advice beforehand.
2020 saw a significant increase in demand for land suitable for installation of Solar Photovoltaic Panels. Undeterred by removal of Feed in Tariffs and RoC’s, developers and investors still recognise that where sufficient parcels of land can be developed, the economies of scale stack up without the support payments previously available.
In 2020, A-J Monro, Head of Environmental & Renewables at Symonds & Sampson LLP brought forward in excess of 700 acres of viable sites, all over 100 acres in size and with the necessary connection. He is finding that many new or existing sites are being further utilised with sustainable features such as battery storage, electric car recharging points and other renewable features, all means to increase the viability and rental income of the site. Generally, rents currently offered are between £750 and £1000 per acre per year, sometimes more.
The process of proposing a site for renewable use is relatively straight forward for a landowner, but as in reality you are committing to a 25-40-year term, it is essential to ensure all factors have been considered before signing on the dotted line.
Taking proper advice and considering the implication of factors such as inheritance tax (land let for renewable purposes does not qualify for Agricultural Property Relief and incurs tax when passed to the next generation) are essential. Careful negotiation is required to ensure the landowner maximises the income available. A-J would advise on a securing a base rent, plus a percentage of gross revenue that the site yields. This ensures that you do not lose out on income from new technology derived from the site by the developer but without having committed additional land.
If you are considering committing to Solar PV or other Renewable Energy Scheme, please take a minute to get the right advice to ensure you get the very best out of it. A-J can be contacted on 01202 882103. www.symondsandsampson.co.uk