With the renewable energy and infrastructure markets going through a transitional period with the phasing out of feed-in tariffs and the emergence of new technologies such as battery storage, this allows an opportunity to take stock and reassess strategies for the next time a Developer or District Network Operator (DNO) were to come calling.
Ransom strip opportunities are not a new phenomenon, and in the past have sometimes been viewed as a back handed approach to conducting access negotiations. However I beg to differ.
By providing access across your land for any potential development you are assisting in a crucial element of the overall success of a development, and as such you have a right to be compensated accordingly.
If advised and handled in the correct way, ransom opportunities can produce large financial payments. It is key to remember that the size of the area is generally irrelevant, with the crux of the argument being that access is required regardless of whether it’s over several metres or only a few feet. Due to projects often experiencing time constraints the developer is relying on a voluntary agreement to be reached so that key project milestones are achieved, and as a result the landowner can find themselves in a strong negotiating position.
If a voluntary agreement between the parties cannot be reached, then the developer may exercise their rights which can include compulsory powers to purchase or gain access onto the land. However this is often a last resort for the DNO’s who are focused on improving their public image and building relationships with landowners where future access is probable. The implementing of these compulsory powers is a timely and expensive affair which can take up to 2 years with a minimum cost of £15,000 to be factored in.
The final compensation claim should be in the forefront of the mind as soon as initial contact with the Developer takes place. The Developers are obliged to compensate for losses incurred as a direct result of the scheme taking place. As the landowner you are required to justify all losses incurred. Therefore it is vital that accurate time sheet should be kept throughout, any additional losses / costs such as extra spraying or drilling costs due to fenced off areas also need to be factored in. The more information, photographs, plans and rationale that can be provided to the Developer the greater chance of having the claim settled in a timely manner, and more importantly achieving the true financial settlement for your losses.
Armed with information such as this, and with the right negotiation tactics landowner can maximise the value of their assets and steer discussions surrounding overage, uplift, future access clauses, compensation etc. to their benefit. It is therefore vitally important that the landowner seeks professional advice from a specialist energy surveyor at an early stage, usually these fees will be paid for by the acquiring developer and as a result the landowner would not be left out of pocket.
Senior Energy Specialist
Richard specialises in energy and infrastructure developments nationwide, advising on and managing projects from initial feasibility through to completion. He also provides professional advice and ass...