2. Neighbour Matters
Most large-scale renewable energy and transmission projects will have neighbours. Neighbours are residents or owners of properties in proximity of the proposed project, whether or not they are adjoining the host land. There may also be neighbours that are not in proximity of the project that are affected by project related infrastructure, such as high voltage power lines and roads used to transport equipment and personnel to and from the project.
As discussed in Section 1, neighbours may have also been potential hosts for the project with the expectation of a material income stream from the project. If their hosting footprint has been reduced or withdrawn this has the potential to make them reluctant neighbours and possible opponents.
Neighbours may also include functional facilities, such as an airfield, where a proposed wind farm or transmission line could impact on the operation and safety integrity of the facility.
Other neighbouring facilities could include sporting precincts, schools, places of worship, community facilities, parks and gardens. This is particularly so in the case of high voltage powerlines.
Neighbours may be materially impacted by the development, construction and operation of the project. Impacts may be due to land access for surveys and investigations, project construction equipment and contractor vehicle traffic, construction noise and dust, travel disruptions, road damage, blocked roads, visual amenity, operating noise and economic loss. Neighbours may have concerns in anticipation of these impacts as well as the actual impacts once the project commences construction or is operating.
While developers have generally engaged and consulted well with potential host landowners (transmission being an exception), developers have not always understood the importance of consulting and working with neighbours in proximity to a project. A typical complaint received by our Office from project neighbours is that they were not consulted by the developer and only heard about the project from third parties. Often there is limited evidence to verify the degree and level of consultation and interactions between the developer and neighbours to the project.
Consultation activities with neighbours include a wide range of topics, such as:
- consulting with neighbours on the project’s design and layout, especially during the early scoping and design stages, to enable a fact-based discussion about landscape/amenity impacts
- identifying dwellings on the neighbour’s property and ensuring that appropriate set back distances have been accommodated in the project’s design
- entering into agreements with neighbours where set-back distances and noise levels would be in breach of the planning guideline
- consulting with neighbours to explain the planning process and opportunities for neighbours to engage in that process
- consulting with neighbours on the process and oversight of specific activities, such as site or route selection, predictive noise assessments, post construction noise testing, environment, aviation, transport management plan, shadow flicker and visual amenity assessments
- advising and consulting on subsequent proposed changes to the project’s design, layout and equipment selection
- ensuring background and operating noise testing (for wind farms) at neighbour properties is undertaken and results are provided in a timely fashion and appropriate format
- providing information to address questions and concerns raised by neighbours
- facilitating site visits to operating projects to allow the neighbour to experience a completed project first-hand, a site visit to a project under construction may also be helpful
- alternately, utilising devices such as portable wind farm noise simulators to enable neighbours and other stakeholders the opportunity to experience noise outputs of a wind farm in a wide range of modelled scenarios
Lack of effective consultation with neighbours can lead to material issues for a project, including conspicuous opposition to the project (and any modifications to the proposed project), formal objections that may lead to planning approval delays and appeals, legal actions against the project or planning authority, the project (or elements of the project) not being approved as well as negative media coverage about the project and the industry more broadly.
In addition to more effective consultation with neighbours throughout the project’s development, some developers have introduced the concept of ‘neighbour agreements. These agreements provide a commercial arrangement between the project and neighbour that recognises the possible impacts of the project on the neighbour.
Developer’s may be required to enter into neighbour agreements to gain permit approval if the neighbour is at a risk of experiencing impacts from the project that exceed permit limits or if they reside within a default setback distance zone.
The content of a neighbour agreement is typically confidential to the parties, but may include one or more of the following:
- annual payments to the neighbour for the life of the project (including payments during the development, construction and operating phases of the project)
- a one-time payment at the commencement of the agreement
- reimbursement of reasonable legal fees incurred by the neighbour for negotiation of the agreement
- reimbursement for, or provision of, items such as visual screening, insulation, double-glazing, air-conditioning, energy efficiency programs, solar panels, electricity consumption
- reimbursement for increased public liability insurance premiums levied to the neighbour due to the presence of the wind or solar farm
- an option for the neighbour to request that the developer acquire the neighbour’s property
- ability for a neighbour to terminate an agreement without penalty
Most neighbour agreements are voluntary, and it is up to the developer to propose and negotiate them with the neighbour. Some wind farm developers have designed neighbour agreement payments based on a formula comprising the distance from a residence to the turbine(s) and the number of turbines located within that distance.
Our Office has observed some proposed neighbour agreements that contain clauses which may not be fair and reasonable to the neighbour. Such clauses include the right for the project to not comply with permit conditions (including noise levels and shadow flicker), the ability for the developer to terminate the agreement while the project is still operating (either without cause or with questionable cause) and clauses that may restrict the neighbour’s right to make a complaint.
Some neighbour agreements seek to impose stringent planning restrictions on the neighbour for any new development or construction on the neighbour’s property. The Commissioner’s view is that these clauses are unnecessary, and the neighbour should simply be required to comply with the planning rules and laws of the jurisdiction.
The inclusion by developers of actual or perceived unfair clauses in neighbour agreements may significantly impair the neighbour’s ability to negotiate a fair and reasonable agreement. This has an adverse impact on the project as it creates distrust and anxiety amongst neighbours and the broader community.
Neighbours and developers may benefit from a standard template for ‘neighbour agreements’ that is established and maintained by an appropriate body and available for use by the industry and the legal profession. Neighbours and proponents may also benefit from our Landholder Guideline referred to in Section 1.
Visual Impacts and Screening
Concerns about visual impacts of wind farms have increased in parallel to the increasing span and height of assets. Common concerns include impairment of views, light pollution from aviation safety lighting and, to a lesser extent, shadow flicker. Concerns about the visual impact of new, large scale transmission towers are also prevalent.
These impacts are commonly assessed during the planning process. However, neighbour sensitivity to these concerns may require special attention by the developer who should ensure that quality predictive assessments are undertaken. Developers should engage in a high degree of consultation with potentially affected landholders and neighbours about these issues.
Developers routinely conduct visual screening assessment, design and implement solutions. These processes may demand significant resources and may not meet community expectations.
Developers commonly propose screening of the visual impacts of wind or solar farm by planting trees. This may also be a mandatory requirement of the permit. An often-cited issue is the predicted length of time for a newly planted tree to grow to provide sufficient screening, bringing into question the effectiveness of such mitigation.
Other mitigations, such as permanent screening, pergolas and blinds should also be considered. Appendix 2 of the New South Wales Government’s Wind Energy: Visual Assessment Bulletin (NSW Department of Planning, 2016) outlines a range of potential mitigation measures that may be applied.
An alternative to developer driven solution implementation is for developers to provide neighbours with the option of a one-off payment in lieu of the screening program. This payment empowers the neighbour to decide how best to apply the funds to address the situation. This approach may also alleviate difficulties within a community such as perceived inequity if some residents have proactively planted trees and are ineligible for the program.
Large-scale transmission projects can create unique neighbour scenarios. If a transmission line is built along a property boundary, the landholder hosting the transmission line would be compensated for the easement and other impacts to the landholder and their land use. The landholder can also likely provide input to the final positioning of the route and towers.
On the other side of the property boundary, the neighbour (sometimes called the ‘first neighbour’) is not entitled to any compensation and does not have a ‘seat at the table’ to negotiate line and tower locations. Generally, neighbours do not have access to land liaison officers as a point of contact with the proponent.
The Commissioner has observed situations where a neighbour’s residence is closer to the transmission line than the landholder and may be as little as 100m from the easement. While setback distances could avoid or improve this situation (see Section 5 of this Appendix), proponents and other project stakeholders need to proactively identify and work with this category of neighbour to implement best practice approaches. Proponents should communicate and establish relationships with neighbours to find solutions to these issues. The implementation of appropriate planning guidelines for large scale transmission should also assist all parties.
2.2.1 Developers should proactively identify all potential neighbours at the commencement of development activity and implement an effective, ongoing consultation program with all contactable neighbours throughout the project’s development. Potentially affected neighbours may include residents and landowners in a proximity range of 0 km to 5 km from potential project asset locations, as well as residents in proximity to project related infrastructure, such as power transmission or supply infrastructure. The range for consultation may need to be greater in situations where, for instance, wind turbines are proposed to be erected on an elevated ridge.
2.2.2 Key stakeholders in the development of a project (for example, project buyers, planning authorities, investors, debt providers, local councils and regulators) should seek and consider evidence of neighbour identification and effective neighbour consultations as part of any due diligence and approval criteria.
2.2.3 Developers should consider appropriate neighbour agreements as a potential component of their overall neighbour and community consultations and project strategy. Neighbour agreements should be negotiable, fair and reasonable, written in plain English and the neighbour should have access to and obtain appropriate legal and financial advice before entering into the agreement. Standard agreements should not restrict the neighbour from being able to raise issues and concerns about the project, including changes to the project design. Neighbours should be able to make complaints about the project and not be subjected to conditions that exceed normal planning standards and permit requirements. There may be existing operating projects where a retrospective neighbour agreement should be considered. Developers may, alternately, opt for a broader community support model that benefits a wider group of community members.
2.2.4 Screening solutions proposed by developers should be realistic and effective. If trees are proposed, trees should be planted in a timely fashion and well maintained to provide effective visual screening within a reasonable timeframe. Other screening solutions, such as structures or shutter blinds, should also be considered when proposing and negotiating a visual screening agreement. Neighbours may prefer a one-off payment option in lieu of the developer designing and installing the screening solution.
2.2.5 Developers should recognise that some neighbours may have been potential host landowners for the project’s initial design and should take the time to understand the neighbour’s history of involvement with the project. Developers should document all conversations and interactions with neighbours and maintain records future reference. Neighbours who have been approached by developers should also ensure that they have documented all offers and agreements presented to them.
2.2.6 Neighbours should be appropriately represented in any project-related committees, such as Community Consultative Committees and Community Engagement Fund Committees, to help ensure that neighbours have a voice and the opportunity to be positively engaged with the various aspects of the project across the community.
2.2.7 Special consideration should be given to large-scale transmission project neighbours that reside along host property boundaries. Developers should ensure there is a process to identify neighbours and develop solutions to real or perceived impacts arising from these situations.
2.2.8 Planning authorities should produce and update their planning guidelines for large scale transmission projects to clearly include provisions for fairly and appropriately minimising the impacts on existing neighbours to the project. Setback distances are discussed in Section 5 of this Appendix.