The developers behind Shetland’s huge windfarm proposal are offering to pay local landowners and crofters more than £2.2 million a year in rent to site around 160 massive turbines on their land.
Almost £1 million will also be paid on stone quarried to erect the turbines, each of which could earn more than £30,000 a year in rent and government subsidy over 25 years.
All the major landowners have already accepted the offer, including the largest landowner, Shetland Islands Council, who are the main promoters of the development.
Crofters are to be approached next week to arrange a series of meetings to inform them of what is on offer and their legal rights.
Viking Energy is planning to build a 600 megawatt windfarm across the central and north mainland of Shetland jointly with Scottish and Southern Energy. The entire development is expected to cost around £1 billion, including the price of an interconnector cable to the Scottish mainland.
Viking Energy, which is owned by Shetland Charitable Trust who purchased the company from the SIC last year for a nominal fee, has written to the landowners and crofting grazings committees which will be affected by their proposals.
Each landowner is being offered a token flat rent for the next three years until 2011 when work starts on preparing the site.
In 2011 and 2012 the flat rent will be boosted by royalties paid on stone at a rate of £1 per cubic metre of stone quarried to erect each one of the 80 metre high turbines. The company has estimated it will need to extract around 900,000 cubic metres of stone to build the entire wind farm.
Once erected the turbines will command a basic rent of £2,500 per megawatt, and as each turbine is expected to produce 3.6MW they should each draw a basic rent of £9,000. However this will increase if each turbine generates the amount of electricity Viking expect, the company estimating each turbine could earn more than £17,000 per year. This figure will be doubled after 15 years, which each turbine expected to operate for 25 years.
On top of this there is a further payment in the form of government subsidies called Renewable Obligation Certificates (ROCs) which could earn anything from an extra £2,700 to £16,225 per turbine.
The turbines should go up between 2013 and 2016 and during this period income will depend on the number of turbines on site.
The offer is entirely dependent on the windfarm being given planning permission. Viking intend to lodge a planning application with the SIC this summer, after it has produced an environmental impact assessment.
A study of the peat bog on which the turbines will be built is currently taking place under the supervision of international peat expert Dr Olivia Bragg and should be finished next month.
Project officer David Thomson said Viking had been talking to the major landowners since 2003 when work began on planning the windfarm, which will be the biggest in Europe.
Now the company is approaching the smaller landowners and next week will start arranging a series of meetings with the various grazings committees who keep sheep on the land covered by the windfarm.
Viking has appointed the Inverness solicitor Derek Flynn, an expert on crofting law, to attend the meetings and inform crofters of their rights.
“The main substantial estates have been in agreement for years now, and we now need to tidy up the fringe items, things like where access roads come into the windfarm,” Mr Thomson said.
“We are about to start the process of speaking to common grazings committees and we will have independent legal advice with Derek Flynn, a very highly respected crofting law expert.
“Crofters will be told here’s an expert, you can take his advice but he’s here and we’re paying for him and if you don’t believe him you are more than able to get your own advice.
“But we want to help them understand what they will and won’t be entitled to. It’s in our interest to facilitate a good process. If everyone falls into an argument it won’t help anyone and certainly won’t help us as developers.”
The main landowner is the council-owned Busta Estate, a conflict of interest which partly led to the energy company being transferred from the SIC to the charitable trust last year.
The other main landowners are the Sumburgh Company Estate, Symbister Estate, the Hunters of Scatsta, and the Hayfield Estate.
Mr Thomson said the landowners would have to share out their earnings amongst crofters with shares in the common grazings and those who have taken out apportionments of land.
Further community benefits will come in the form of jobs, income to suppliers, a disturbance payment to affected communities and the overall profits being distributed throughout Shetland via the charitable trust.
Viking intend to launch another series of public consultations once it has finalised the lay out of the turbines in March, prior to applying for planning permission.
Opposition to the windfarm has so far been sporadic and disorganised, expressed by individuals voicing feelings rather than through an organised lobby.
One crofter and landowner said last night he would much prefer to see a small scale renewable energy development, but imagined many other crofters would “take the money and run”.
The crofter, who did want to be named, said: “There’s an awful lot of folk that croft who will grab any money that’s coming and to hell with the consequences. I’m not like that.”
By Pete Bevington
8 February 2008
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