Landowners told protections provided when dealing with oil and gas companies don’t apply to wind and solar sectors
TABER, Alta. — Southern Alberta’s abundance of sun and wind continues to attract proposals for wind and solar farms, but landowners should be wary about the contents of any contracts they sign, says a landowner advocate.
Daryl Bennett, vice-president of industry and government regulatory affairs for the My Landman Group, said those who negotiate contracts for renewable energy projects have no licencing requirements or standard of conduct, unlike the land agents who negotiate oil and gas leases.
“We’re very worried about these contracts that landowners are signing,” Bennett said during a March 8 meeting of the Action Surface Rights group and a similar presentation March 7 at the Alberta Grazing Leaseholders Association meeting in Brooks, Alta.
“As bad as it is with oil and gas, it could be a lot worse with wind and solar. You’d be nuts to be signing any of this stuff until questions … are resolved.”
Alberta landowners are already faced with issues surrounding reclamation of abandoned or orphaned oil and gas wells. However, Bennett said many wind and solar contracts have no requirement for site reclamation and there’s no equivalent to the Orphan Well Association that exists in the energy sector.
“It’s unregulated. It’s far worse than oil and gas,” said Bennett.
The provincial government may impose reclamation criteria on renewable energy projects, but if the company goes bankrupt or walks away from the project, it is unclear who would be responsible for cleaning up the site. As well, it might fall to the landowner to cover any unpaid property taxes, builders’ liens and utility bills.
There is no government involvement in private contracts of the type offered by wind and solar companies, said Bennett. Contracts can be difficult to terminate, and disputes must be handled through the court system.
Landowners do not have recourse through the provincial government for any unpaid annual rent, and the Alberta Surface Rights Board has no jurisdiction over the projects.
Contracts also generally require landowners to waive any adverse health or noise issues that might arise from the projects. There have been numerous cases in which people living near wind turbines have complained about noise, solar flicker and feelings of malaise.
As for the financial benefits, there is usually a confidentiality clause in contracts that prevents open sharing. However, the highest rate he has seen is $1,300 per acre for solar projects on dryland and $20,000 annually for wind turbines and substations.
Bennett said he knows of at least one case where owners of land adjacent to a proposed renewable energy project have each been offered $15,000 not to object to the proposal.
Some contracts offer fixed rates per acre or per turbine and some offer a percentage of revenue. Bennett discouraged landowners from accepting a revenue percentage because if the company isn’t making money, the landowner doesn’t either, and there are many reasons why companies might be unable to sell their electricity.
As well, landowners should demand compensation when construction starts on the project, rather than waiting until the last turbine or solar panel is up and running, because projects can face delays or cancellation before completion.
He also warned landowners to consider field access points and responsibility for weed issues before signing contracts.
Alberta’s NDP government has put various programs in place to encourage renewable energy projects. Its goal is to have 30 percent of Alberta’s energy come from renewable sources by 2030.
Bennett said he wonders what will happen to any subsidy arrangements should the NDP lose the next election in spring 2019.
The Alberta Farmers’ Advocate Office has a document that repeats some of Bennett’s advice and offers other information.
“Negotiating for a wind or solar lease is different than negotiating with the oil and gas industry,” the document says.
“In Alberta, there is no right of entry or expropriation process for a renewable energy power plant. Participation in a wind or solar lease for a power plant is 100 percent voluntary, and you are under no obligation to entertain a proposal. Contracts are negotiated bilaterally between the landowner and the renewable energy developer. If you decline interest, the developer will have to find an alternative location.
“However, the new spot may be located nearby, in which case you would experience impacts without generating direct value from revenue.”
It further states that every contract is different and designed to meet the company’s needs rather than the landowner’s. The Farmers’ Advocate Office recommends that landowners get legal advice before signing any contracts.
The complete FAO document can be found at www1.agric.gov.ab.ca/$Department/deptdocs.nsf/all/agdex16246/$FILE/negotiating-renewable-energy-leases-v2-jun-17.pdf.
A number of plans for wind and solar development are being developed in southern Alberta. Among them is a large solar project north of Claresholm, proposed by Claresholm Solar, which would require 880 acres.
A Calgary-based company, Solar Krafte Prairie Sunlight, has proposed eight different projects in southern Alberta. Locations include a site north of Enchant, two near Vauxhall, one near Stirling, one west of Warner, one near Wrentham, one west of Brooks and one southwest of Spring Coulee.
Among the various wind project proposals is one near Tyrell Lake near New Dayton, Alta., which has raised concerns locally about the impact on wild bird populations.