Over 5,000 acres of farmland across the country is now under some form of solar contract. The majority of this land is in the south and southeast. However, solar development companies are continuing the march up the country, where the level of solar energy to sustain a project is very questionable.

Farmers across the midlands and into the northwest with land parcels of 25 acres close to substations continue to get approached. They are offered the prospect of as much as €1,500/ha for leases up to 25 years. In many cases, pressure is being put on to sign exclusivity agreements and options amid suggestions that if they don’t sign their, neighbour would have the option first.

The slashing of solar feed-in tariffs in the UK has seen larger companies there look to Ireland as the new Klondike, adding to the frenzy. This speculative calling to farmers by development companies, combined with the policy uncertainty, is a real cause of concern.

IFA renewables project team chair James Murphy agrees that there is currently positivity around solar energy production in Ireland, which is reminiscent of the optimism around the ill-fated miscanthus plans of a number of years ago.

“The speculation is all leading to fuel a solar bubble that will leave many farmers’ legitimate expectations undelivered,” said James.

He said a clear national solar strategy is urgently required. “This strategy must provide certainty for all impacted, most particularly host landowners who facilitate the projects and communities that live in the vicinity of proposed solar projects.”

The Government’s energy white paper, published in December 2015, said that solar as well as bioenergy will become an increasing part of the energy source mix as they become more cost-effective. However, solar power in Ireland is not financially attractive without a substantial feed-in tariff.

The white paper gave no indication of the feed-in tariff, only saying that consultation was ongoing and is now expected to be revealed in late 2016. The industry said it needs to be 10c/kWh to 15c/kWh, nearly twice that for large-scale wind.

The quantity of solar power that could be supported was also not mentioned, but some sources talk of 300 to 600MW to be made eligible for tarriffs. It’s a long way short of the 1,700MW and more that developers are lining up.

Applying for grid connection is not cheap. The ESB has collected €7,000 to €8,000 up front for each 5MW application. That’s not to mention the potential legal and planning costs that could increase the cost to €20,000 before they are guaranteed to be able to go ahead.

In some ways the rush to sign up landowners is more to do with the current application queuing process.

Under the current process, applications received are assigned a node and enter a processing sequence at that node. The first application in sequence is studied and a connection offer issued. Following acceptance or lapsing of that offer, the next application in line is looked at.

One aim of the developers is to get in early in a queue at the different nodes to increase their changes of offers. The exclusivity agreement’s small print could allow for the developer to move an offer from one farm to another farm. This happened early in the wind process, leaving many farmers who believed they had secured a windfarm on their land high and dry.

With such a burst in applications, the Commission for Energy Regulation is currently reviewing the process for accepting solar projects on to the grid infrastructure. Any change will cause consternation from the developers who were in early and close to the top of the queuing system.

It is also very hard to advise farmers to sit and wait as they fear they will miss out. The one thing they should not do is just sign an exclusivity agreement that stops them from talking to other companies.

If you want to go ahead, look for an option agreement and make sure it is limited to the portfolio in question, not the whole farm. Read the small print to ensure developers cannot move grid connections to different farms once established. Get advice from solicitors and experts who are familiar with solar contracts. There are also many issues such as capital gains/gift tax issues and even potential commercial rates on solar farms that are as yet unclear.

The biggest push from the IFA from the start is that communities must be involved. Community participation and energy citizens were definitely a big part of the energy white paper.

“Under planning law, all development companies must be obliged to actively engage with communities. No applications should be accepted by any planning authorities unless they clearly state that communities in the vicinity of a proposed project have been consulted and engaged with. This community involvement must happen before the planning application is lodged,” said James.

He argues that these same communities must be at the centre of future renewable energy developments. “This means that to be eligible for State financial support, all large-scale energy development companies must offer at least 25% of each project for community ownership, once built out,” James said.

In addition, each year at least 1% of the turnover from these projects must be invested back into local communities to support rural regeneration and employment.

Community participation

The current vacuum has to be addressed urgently. The IFA wants the Department of Energy, ESB and the CER to put in place. a 2.5c/kWh tariff premium, grid exemption and a community quota to support community projects. For the quota, at least 25% of any new renewable scheme should be ring-fenced for community projects that have at least 25% community ownership.