Be proactive. Don’t wait for a developer to come to you.
Landowners with appropriate sites could achieve a rental income worth £500,000 to £2 million over 15-20 years for hosting a large-scale energy scheme. Yet in most cases landowners don’t consider the opportunities until a developer knocks on their door.
To get the best out of any scheme we strongly encourage landowners to be proactive, and to investigate their energy opportunities, and if appropriate, seek permission to connect to the electrical grid before a developer approaches them. Maintaining control throughout the process is also key to success.
Assess the potential for schemes
Landowners can see what potential their land has by contacting an independent grid consultant. An independent consultant that offers a low cost feasibility (or Stop/Go) study is the best approach. In this study the grid consultant will assess the available grid capacity locally, evaluate sites on your land and determine which technology, if any, is appropriate for the ground. It will indicate whether the scheme should be pursued or if it is not worth investing money and time in a scheme that would never get off the ground.
If there is no possibility of a scheme on the site on the local network, then the landowner has invested very little. If there is potential, the landowner could have much to gain. The independent consultant can then assist the landowner with the next steps in the process and work in the landowners best interests to maximise the success of the scheme.
Applying for grid connection
Getting permission to connect to the electrical grid is the most important factor in determining the success and income from any scheme. Moving fast to secure vital grid capacity ahead of any neighbouring landowners is critical as other sites may be competing for the finite grid capacity in the area. It is important that your consultant applies for the appropriate technology for the site – not all sites are suited to all technologies and a grid application can only be for one technology.
Connection applications take up to 65 working days, and every Distribution Network Operator (DNO) operates on a first-come-first served basis. Any delays before application could put you behind a neighbouring site.
Going out to the best competing developers
Only once grid rights are secured, should the consultant go out to a selection of the best operators and developers to seek the best schemes, with the most competitive terms and ground rents for the landowner.
If developers or operators are approached before grid rights are secured, you are in danger of bringing about a local feeding frenzy with multiple developers approaching your neighbours to secure a scheme on their land where they are not subject to competition.
Get on the front foot and beat your neighbours!
Don’t wait for a developer to come to you. Developers are just as likely to approach and sign up one of your neighbours and therefore take any local grid capacity that might be available. They key is to be proactive. It’s far better to get on the front foot to secure grid capacity in advance of your neighbours – there are no prizes for second place when the grid is full.
If you have left it too late and a developer does knock on your door, our advice would be the same – contact an independent and specialist grid rights consultant immediately. Signing a letter of authority giving a developer permission to apply for a grid connection on your land brings its own set of risks which a niche consultant can help you to avoid.