I don’t normally carry adverts but in this case I will make an exception. Alastair Collin of Turrin Connel published an advertorial in the Energy North news sheet. I would suggest that it be shown to every land owner, existing and prospective with the caveat that it is up to the landowner to protect their own interests. Some of these suggestions rely on long term continuation of insurances and bonds possibly over several different companies as developers sell on their investments. It is a point of legal nicety that should a company go into liquidation the liquidator may well ‘liquidate’ the bond to pay the creditors. Where does the landowner stand in that situation?
Press coverage recently of a Borders wind farm being shut down after a section of turbine blade was found on a road approximately half a mile away from any turbine location has highlighted the importance of landlords understanding and, if necessary, improving on any contractual protections with a view to minimising potential liabilities. The incident follows hard on the heals of reports of a large scale turbine collapse at a site in County Tyrone. According to reports debris was scattered several hundred metres from its source.
It is important that landlords insist upon developers relieving landlords of liability in respect of claims arising from such incidents, whether these claims arise from the landlords themselves or from third parties. It is also critical that developers back up such indemnities with suitable insurance policies at sensible levels which reflect the extent of potential liabilities and practice in the industry.
The photos that were published of the site in County Tyrone gave an indication of the potential damage which can be caused to a property. It is vital to consider what provision has been made in safeguarding property should a lease come to an end either naturally or following a breach by, or insolvency of, the developer. The best policy is to insist on a robust restoration provision with the developer being bound to put in place a bond or other form of financial guarantee or fund(“restoration provision”) in terms which are agreed by the landowner(whether the restoration provision is a joint provision in favour of the planning authority and the landowner or not).
Some of the key questions are:
- Has the restoration provision been set at a level that truly reflects the potential cost of restoration and with a provision for regular review to ensure suitable protection is offered for the life of the wind farm.
- Is the landowner a party to the restoration provision and what restrictions apply on the landowner’s liability to make a claim?
- Is the period of restoration provision sufficiently lengthy?
- Who determines when the restoration provision can be discharged – planning authority, landowner or (ideally) both|?
Many developers will argue that landlords need not concern themselves with restoration on the basis that the planning authority has statutory duties to ensure it is dealt with. However the dangers of such an approach are all too apparent from a reading of the January 2014 independent review of opencast coal operations in East Ayreshire. The review identified major and persistent failings at a number of levels in the way that restoration plans (and restoration bonds and restoration) were scrutinised, monitored and enforced. It is critical for any landowner, or their advisers, not to place reliance on restoration provisions negotiated by third parties.
We would urge any landlord with wind turbines on land being let to third parties to ensure that restoration is not ignored and that opportunities for review of bonding levels are fully utilised.
Whilst this covers many areas we might add liability for forest fires which existing insurance may not cover in the case of a turbine fire and liability for water contamination(Whitelees) and possibly for noise nuisance in the future. Many cases are presently in the US courts and what starts there often arrives in the UK shortly after. How soon before the no win/no fee vultures see pickings to be made. The renewable industry has promoted the view that scrap value of the turbines will cover restoration costs. Who know in twenty years if steel will have a value as products such as carbon fibre take over.
Certainly it is a case of caveat emptor when you buy into the Great Wind Scam and those who will pick up the tab without doubt will be the landowners, as the klondikers disappear in the sun to their retirement houses in tax havens far away from our shores or the reach of our laws.