Community benefits

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Alongside the expansion scheme, Peel Energy is committed to providing a number of local community benefits.

Voluntary community benefits schemes are a typical part of onshore wind projects (over 5 Megawatts (MW) capacity) and Scout Moor is no exception. Once the new turbines start turning, we’ll make a pot of money available for use by local projects and community groups. If you live close to Scout Moor Wind Farm, find out below how you could benefit from its expansion.

How will the Community Benefit Fund work?

It’s a long term, reliable and flexible fund stream for local community initiatives and projects. We’ve committed to providing £5,000 for every extra installed megawatt of energy from the new turbines for a total of 25 years. This could create an annual fund worth up to £200,000 a year which would equate to up to £5,000,000 over 25 years. Rossendale Borough Council owns some of the land that is being promoted as part of this scheme. As part of the commercial terms agreed, Rossendale Borough Council will administer 15% of the annual fund within the Borough as a whole whilst the remainder will be managed by the local communities themselves.

How will the Co-operative Ownership Scheme work?

People and businesses that are located close to the wind farm will also have the opportunity to own a share in the new turbines through a local community co-operative. The co-operative would be set up by specialist advisors, with the involvement of local people and organisations, and governed by an elected board of directors. It could own up to two turbines in the new scheme. The funds required to build the new turbines would be raised through a co-operative share offer that would provide a fair rate of return to investors of potentially 6-8 per cent a year plus the return of the initial capital over 20 years. The minimum investment would be set as low as £50 with all members having an equal say in how it’s run. The co-operative would also be run as a social enterprise for the benefit of the local community. Any surplus income after costs could be reinvested by the co-operative in other community projects.

A leaflet summarising the ‘Community Benefit Fund’ and ‘Co-operative Ownership Scheme’ is available to download.

We have also prepared some ‘Frequently Asked Questions’ to provide you more information about the CBF.

Frequently Asked Questions:

How is the CBF related to the planning application?

The Community Benefit Fund (CBF) is an entirely voluntary undertaking by wind farm developers. These community benefits are separate from the planning process and are not relevant to the decision about whether the wind farm should be approved or not. The CBF only applies if the expansion plans are approved by the Councils.

Is there an obligation for wind farm developers to provide a CBF?

There is no legal obligation on SMWFEL (or any other wind farm developer in England) to provide a community benefit fund. Renewable UK in conjunction with, and on the behalf of, the onshore wind industry has voluntarily developed a commitment to provide a community benefit package to the value of at least £5,000 per MW of installed capacity per year. SMWFEL’s offer is in line with that promoted by Renewable UK.

How much will the CBF amount to each year?

We’ve committed to providing £5,000 for every extra MW of generating capacity installed for a total of 25 years. This could create an annual fund worth between £160k and £200k a year which would equate to £4m to £5m over 25 years.

Who will control the CBF?

It is essential that the CBF be managed and controlled by a formal organisation. There are a number of options available: a community body; the local authority; an independent fund administrator (e.g. a specialist community fund organisation). In a limited number of instances a mix of all three has been employed.

How are funds distributed?

The developer and the community should work together to determine which arrangements are best suited to the needs of the community. CBFs have typically taken the form of an annual payment by a developer based on the installed megawatt (MW) capacity of a wind farm, or in some recent cases a payment relating to the actual electricity output of the project. Another alternative is a lump sum payment, for example at the outset of a project.

How has Rossendale Council got control over some of the CBF?

Rossendale Borough Council owns some of the land that is being promoted as part of this scheme. One of the commercial terms agreed between the Council and SWWFEL was that the Council would have exclusive control of £2,000 / MW for every turbine installed on its land or 15% of the annual fund. This money is to be used for purposes identified by the Council within the Borough as a whole.

What can the CBF be used for?

Identifying community benefits which are related to the needs of the local community should grow out of discussions between the community and SMWFEL. Ideally the CBF would be focused on projects that will continue to provide benefits or enhancements beyond the lifespan of the Fund. You could choose to allocate part of the Fund toward short-term goals, and part toward longer term more strategic aspirations. We are asking local residents, businesses, councillors, education providers and community groups and voluntary organisations to get in touch. More information is provided on our leaflet.

Does the Council have to be involved?

There is no formal requirement for either Council to have any further involvement. It is however, worth considering other ways in which the Council might be able to assist, e.g. in helping to identify priorities for support from the Fund.

When would the CBF first be available?

The CBF will come ‘on-stream’ when the wind farm is fully commissioned and exporting power to the national grid. At present this is predicted to occur in 2017.

Who can access the CBF?

There are some restrictions to those who can’t access the CBF and include:

  • Parish, Town or Borough Councils
  • Registered Community Interest Companies (CICs)
  • Individuals

In addition the CBF can’t be used for the following reasons:

  • The promotion of religious or political views;
  • To replicate or replace statutory Council provision;
  • For private benefit
  • If the application would give rise to a Health & Safety risk;

If it would be against the interests of the developer or land owner(s);

  •  Retrospective funding, i.e. something that has already been paid for or happened.

What is ‘the community’ when it comes to the CBF?

We will continue to engage with the local community to refine our understanding and about how factors such as local geography, priorities, local interactions and needs could be used to refine this definition.We will provide a suggested approach on our website following the submission of the planning application.

Can CBF money be invested?

Investing Fund money is inherently risky, as value may be lost due to market factors. It is SWWFEL’s preference therefore, that Fund money is spent directly on identified projects.

Is there any more guidance you could point me to?

The Department of Energy and Climate Change (DECC) produced a comprehensive guidance note in October 2014 which you can download from its website. You can also search the web for “community benefit funds” and see lots of examples of how other communities are managing and allocating their Funds to help you get ideas.

What happens to the CBF if you sell the wind farm?

The CBF will continue to exist in the manner and amount that we are describing. Preservation of the CBF will be made a condition of sale should this situation come about.

When will discussions about the CBF start?

We are responsive to suggestions about how the CBF can be administered. We would like to help identify and establish a Liaison Group to start lead on the priorities for the CBF and will be looking to start this discussion in the Summer of this year.

Can any CBF be made available ahead of the wind farm being built?

The CBF will only be available when the wind farm has completed its first year of export following full commissioning.

Is there a limit on the amount any group can apply for?

This depends upon how the administration of the Fund is structured. It is common practice for ‘grants’ to be capped at a maximum level, but if the community decides that the entire Fund should be directed toward delivery of a single project, there is no reason why this could not be undertaken. You might also choose to vary the ‘cap’ on grants during the lifespan of the Fund.

Can the way the CBF is run be changed mid-way through its lifespan?

Yes – if this is what is thought appropriate by ‘the community’. It may be entirely appropriate to revisit on a regular basis (e.g. every five years) the priorities and administration of the CBF. There is however, no requirement to do so.

Why hasn’t the existing Scout Moor wind farm got a CBF?

The existing Scout Moor wind farm was granted planning permission in May 2005. At this time the inclusion of community benefit funds within England was not expected of developers. The then Department of Trade and Industry (DTI) only published its guidance note on such funds in May 2007, some two years after the wind farm had got consent.

Shouldn’t you include the existing wind farm in CBF calculations?

The existing Scout Moor wind farm is not owned by SWWFEL, having been sold in October 2012. Commercially it is not possible to retrospectively apply (and back-date) a charge on the existing wind farm to cover the sum that a CBF might have equated to if modern-day standards were applied.