Could the future be bright for solar power in Scotland? Well, signs are certainly emerging that solar farms may become a more common feature in the nation’s rural landscape.
Our rural team is advising landowner clients on a number of potential solar farm developments about which they have been approached in different parts of the country. But what might this mean? Another growing possible avenue in which agricultural and estate enterprises can tap into renewables and diversify their income will certainly be welcomed by many.
As with any other renewable energy development, however, it is important that careful consideration is given to solar farm proposals so that you have a true understanding of all the implications before signing up.
Solar farms have previously been relatively rare in Scotland’s green energy mix, particularly when compared to wind and hydro power projects.
There are some experts, however, who believe that photovoltaic installations north of the border can perform just as well as sites in southern England - where schemes have traditionally been more prolific - because of slightly longer periods of daylight.
Technological advances and declining costs in solar also mean that subsidy-free developments could prove increasingly attractive to some landowners.
Like wind turbines, solar farms can operate on the same ground as sheep grazing, so not all productive agricultural land need be lost to developments, a factor for many seeking to balance the demands of natural capital and food security along with environmental and business sustainability.
And, while in the drive for diversification, the temptation can be to quickly jump into an agreement which guarantees long-term income, it is advisable for landowners to understand the intricacies of contracts. After all, you could be committing your business to a decades-long agreement.
A sensible starting point is to ensure you are clear on how much land is needed. It is thought that about 25 acres is required for every five megawatts of power produced. But it is not just the panels about which you need to think. Just as with wind and hydro, space will be needed for critical support equipment such as battery storage.
With all of that, a detailed understanding of access and services is needed. Might cables need to be run over land that is not yours? What agreements might that mean you need to have in place?
You also would not want to find yourself unable to work as you need with livestock or lose access to certain areas because you have not fully understood the detail around rights on that front or, indeed, whose responsibility infrastructure is.
Tenants’ rights can also be a factor where agricultural or other leases are in place. How might they be affected?
Looking at the ownership structure of any development, it is also vital that you understand what the project and the income from it could mean, both for immediate tax efficiency and any succession plans that you may put in place, whether immediately or years down the line.
On top of all of this, of course, is the requirement to ensure that all necessary planning permissions are in place.
Scotland’s landowners have a major part to play in the nation’s journey towards net zero. Diversification will also be the key to the success - in some cases the survival - of so many rural enterprises. Renewable energy is an influential part of that and there are many opportunities for landowners to be part of that, given the right circumstances.
The wisest approach to dealing with any potential diversification, though, is to secure sound legal advice. Without that, the returns may not reach their full potential. The most prudent course of action is to know what the fine detail means for you, your business and its future.
Article published on 14 November 2023.
