Wind Turbine Lease Agreements
Despite a relatively small need for space, a wind project can significantly affect farm operations, efficiency and production, says Dwight Aakre, a farm management specialist at North Dakota State University. Farmers` donors are largely affected by wind contracts. Landowners risk violating their leases if they enter into a wind contract without the tenant`s consent. While landowners with one-year leases can terminate these leases and renegotiate the conditions that house the installation of a wind turbine on the land, landlords with multi-year agricultural leases must involve the tenant in discussions with a developer. The tenant is in possession of the property for the duration of the lease and cannot be evicted. Landowners should also consider the impact of the wind farm on future tenants of the farm. Wind energy leases often take 50 years. The long lease life is necessary to give the developer time to get a return on the huge investment required to build a wind farm. Ferrell is also asking landowners to form a bargaining group “when you hear that someone in your area has been approached with wind energy. You are strengthening your bargaining power. Although outside the scope of this chapter, a wind promoter may, in some cases, use a previous land contract through subletting, under-occupancy or another, or by a partial assignment or splitting of the previous agreement into two or more separate splitting or partial assignment agreements. They each have concerns similar to those of a direct agreement on wind energy with additional issues relating to the management of former interest owners and underlying owners, in order to ensure that derivative interests are protected and secure, despite a problem with or termination of the previous agreement Your lease agreement should provide for the elimination of structures and roads from the wind farm after the completion of the project and the restoration of the soil. Aakre said. The lease agreement should go around your rights if the wind company does not respect its commitment.
Some agreements require a developer performance obligation to ensure that the money is available for dismantling. Another central theme for owners is the responsibility to build and operate wind towers on their land. Landowners should ensure that the owners agree in the contract to release them for damage. These include defending landowners in future legal actions and compensation for legal damages caused by the wind farm. The agreement should also require the developer to put in place sufficient liability insurance to protect the owner of the land. Landowners should check for potential non-compliance due to a wind farm – including harassment, neglect and transgression – with their legal advisors and their own insurers. The safety, flexibility, profitability and stability of the project`s land rights are at the heart of the total value of a wind project. The tool to record this value is usually a wind energy lease or facilitation agreement that creates and protects a developer`s interests and investments in the property and project and provides reliable income to the landowner while providing the developer with the flexibility to transfer all or part of the project throughout its lifetime. Wind agreements generally provide that the developer is responsible for removing the tower (up to a certain depth underground) when the project is completed.
Landowners should carefully read these provisions and understand how triggered this relocation obligation is. You`ll probably need extra insurance to meet your compensation obligations, Ferrell says. “This is especially important when you rent the property to hunters.” He adds that the increase in insurance requirements for the owner of