Communities and Benefits From Renewable Energy Developments

27th February 2012

The Highland Council has taken an important step towards securing the highest level of benefit possible for local communities across the Highlands from renewable energy developments by agreeing a policy on how future funds are allocated.

Council Leader Michael Foxley and Councillor Isobel McCallum, Chairman of The Highland Council's Rural Affairs and Climate Change Strategy Group, highlighted the Council's commitment to community benefit at a conference in Inverness on Friday 24th February 2012 organised by the Council.

Councillor Foxley said: "We are committed to maximising community benefit accruing to all Highland communities from onshore and offshore renewable energy developments. We will lobby Scottish and UK Governments so that the aims of the policy can be achieved in a realistic timescale. We will spread benefits as widely as we can throughout Highland for the good of all communities. Communities will be able to apply for funding to their Local Fund and to the new local Area Fund(s) and Highland Trust Fund. The Council will not get any financial benefit. We are driving this policy through entirely so that local communities benefit."

Councillor McCallum said: "We want to ensure that local communities benefit directly from the use of their local resources. Any development that has an impact on the environment and local resources should have clear and direct benefits for those who live and work in the area."

Keynote speaker at the conference, Energy Enterprise and Tourism Minister Fergus Ewing said: "I want Highland communities to share in the economic and social benefits of Scotland's onshore and offshore renewables revolution. Scotland leads the UK in our support for local ownership of renewables projects and we have set a new target of 500 megawatts of community and locally owned renewables by 2020, which could be worth up to £2.4 billion to communities and rural businesses. We provide loan support under our Community and Renewable Energy Scheme and we want to maximise the community benefits of commercial developments. Successful events like these give us a greater shared understanding of those new opportunities for the Highlands."

The Council's policy applies to all onshore renewable energy developments. It seeks a minimum payment to community benefit funds equivalent to £5,000 per Megawatt of installed capacity per year. The Council will seek to negotiate concordats with developers, which will ensure that developers operate within the Council's policy and that developers negotiate directly with the Council on behalf of communities to secure the greatest level of benefit possible.

The 4 Allocation Factors will be:
* Proximity to the Site
* Visual Impact
* Construction Impact
* Number of Residences

The Council's policy is a 3-tier system of benefit with all of the first £100,000 per year of benefit going to local communities and managed within a Local Fund. Of the community benefit that remains:

* 55% will also go to local communities through their Local Fund
* 30% will go to one of ten local Area Funds covering Caithness; Sutherland; Dingwall and Black Isle; Easter Ross; West and Mid Ross; Lochaber; Inverness; Skye; Nairn and Ardersier; Badenoch and Strathspey
* the remaining 15 % will go to the Highland Trust Fund

It is intended that all three funds would receive bids from communities, groups and other appropriate organisations for the following project types:
* Financial and other support for business and community projects (including provision of infrastructure)
* Alternative and renewable energy research
* Energy generation and efficiency schemes (including community ownership or stakes in renewable energy developments)
* Community ownership or control of assets
* Projects which address issues of fuel poverty
* Other community interest projects based within the community
* Skills development and apprenticeships

Communities that do not have access to community benefit funding at the Local or Area Fund level will be able to bid into The Highland Trust Fund, which will be operated by an organisation at arm's length from the Council. These communities do not often host renewable energy developments, but they may provide services for those that do; they may have grid lines carrying renewable electricity passing through them; or they may be subject to transport of renewable energy equipment during construction.

The council is also determined that local communities benefit from off-shore developments, which are regulated by the Crown Estate Commissioners and by Marine Scotland. The Council will negotiate with these bodies to ensure that Highland communities benefit from developments around their shores. The Council will negotiate directly with developers to achieve the same aim and once again will seek £5,000 per Megawatt installed capacity per year.

The Council recognises the significant sums that may, in time, accrue in the way of community benefit from off-shore activity. Again, the Council is of the view that these benefits should be spread as widely as possible across Highland. The Council proposes that where development takes place in open waters, 20% of the benefit realised will go to coastal communities. The remaining 80% will go to The Highland Trust Fund. Given the potential amounts of benefit, the Council believes the Highland Trust Fund should realise significant sums that are currently not available to support development in any Highland communities. The Highland Trust Fund will be open to bids from communities impacted by development and other appropriate organisations working with communities, including, for example, the University of the Highlands and Islands.

In inshore waters, such as the Pentland Firth, the Council will look at each case on its merits so that benefit accrues to those communities more closely affected by developments. This will reflect the proximity of development to local coastal communities and, for example, construction activities and any displacement of fishing activities. It may also be that the Council will need to involve other Local Authorities in negotiation.