Karen Walsh: Impacts of opting for solar energy on farm

Practicalities
Having a solar farm located on a remote part of your holding is one thing, having such an installation in the middle of an active farm is another.

The potential impact on existing operations should be given serious consideration. Turbines and access routes can affect your farm greatly.

They can change field configurations and create land fragments inaccessible to large equipment. On grazing land, fences and gates may have to be changed.

Access is another area to consider carefully especially during the construction phase. There could be up to one hundred and fifty articulated lorries accessing your lands.

How will access roads and construction affect your farming business and daily life?

Impact on Basic Payment Entitlements

Before you sign any document you need to consult with your Teagasc advisor. Entitlements could be affected by the installation of solar panels on your land. The area taken up by solar panels themselves will not usually be eligible for basic payment entitlements.

Therefore the farmer should deduct these areas from the basic payment entitlements application. When considering whether the rest of the land parcel is eligible the farmer must consider whether or not he can demonstrate that the primary purpose of the land is agricultural.

For example, if the primary function of the land parcel is for solar panels the whole land parcel is ineligible.

Whereas if the land around the panels (and maybe also under the panels) is grazed in line with normal grazing activities this land could be considered eligible but the farmer must still deduct land which cannot be grazed from their basic payment entitlements application.

How many entitlements will you lose? The answer really is “it depends”. You need to speak with professionals in advance of signing to ensure you enter into such an agreement with all the facts. Keeping the land in good agricultural and environmental condition also needs to be adhered to.

Maintenance

The developer is responsible for maintenance costs and usually have their own insurance in the event of damage to equipment.

Check at the start that it is in order to graze stock on the land once the solar park is built. Some companies may only allow sheep to graze around the panels.Access tracks may need to be improved or extra ones built. You need to establish who will pay for this. You also need to consider how the equipment will be taken out again at the end of the rental period and who will pay for this.

A common fear of farmers is that when the lease comes to an end, they will be stuck with solar panels and equipment on their land. Seek a bond to be put in place as coverage should the developer fail to remove equipment or if he cannot afford to clean up the area or reinstate the land, once the lease expires.

Costs

Developers also tend to cover legal engineering and other professional fees incurred. Farmers should ensure that they incur no costs at all even in the initial planning and set up. They should not be put out of pocket.

Insurance

Ensure that you are entitled to a copy of yearly insurance certificates. Ensure the developer indemnifies you in relation to claims arising out of the developer’s use of your land.

Right to renew?

The developer should retain no rights whatsoever once the agreement has terminated.

An option for the developer to extend the term is not unusual. He should not have an automatic right to renew. A developer should have to re-negotiate with you again. Is it really essential for the developer to have an option to extend the lease?

Most leases will have a voluntary termination clause in favour of the developer, on receipt of written notice. Should this be coupled by a payment? It is up to you to negotiate.

What to look for in a developer

Credibility and solvency

Experience/history

Proven track record

elsewhere in Europe

Financial standing and

access to funding

Seek independent advice

It is essential to seek expert advice before putting any pen to paper.

Rushing into signing could have far reaching and disastrous consequences for the farming business.


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