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Today, renewable energy sources make up a significant proportion of the electricity mix that powers our homes and businesses. With the drive to decarbonise Britain’s electricity grid by 2030, and to meet the Government’s net zero target by 2050, more developers and funders are investing in green energy projects. 

Opportunities big… 

While the technologies involved in harnessing wind, solar and hydro energy might be relatively new, the title defects that solicitors are uncovering when acting on behalf of developers are similar to those we see with many traditional property or land transactions. Issues such as restrictive covenants, lack of rights of way, manorial or mining and mineral rights, or other outstanding third-party rights and easements affecting sites remain commonplace. Enquiries relating to the lack of a legal easement for services are particularly relevant where pipelines, cables and power connections extend over long distances that could include unregistered strips of land. In these scenarios, where ownership is unknown and sufficient legal easements for installation of the service media cannot be acquired, legal indemnity insurance can prove invaluable in getting transactions over the line.  

… and small

It isn’t just agricultural land and commercial premises that are seeing the impact of renewable energy projects. As part of the new government’s “rooftop revolution”, the Prime Minister has promised that millions more homes will be fitted with solar panels, including on new developments, to bring down domestic energy bills and help meet the manifesto pledges on clean energy. Title issues can still be a factor on domestic properties though; for example, where a developer or homeowner has installed panels to their roof, unaware of restrictive covenants that affect their property. As a result, we’re seeing more requests to provide purchasers and lenders peace of mind over any breach of covenant claim that may have arisen. 

The increasing popularity of electric vehicles over recent years has been another factor behind the rising number of ‘clean energy’ enquiries we have been receiving, with the installation of EV charging points becoming more widespread. Whether the transaction involves leasing parking spaces to install new charging points in an existing car park, or the development of a new charging station site, title issues can still arise which require a legal indemnity policy.

‘Green’ legal indemnities expertise

While the title defects related to renewable energy sites may not be unusual, the key difference they present compared to more traditional large-scale developments is the type of losses that can be insured against. This is due to the different type of land transaction taking place, who we are providing cover for, the legal interest being acquired by the green energy provider at the outset and the proposed use of the site.

For example, rather than a housing developer purchasing the freehold title of the land and then selling the properties they build on it, we could be presented with a commercial lease agreement where a farmer is granting a ‘green lease’ to an energy provider, who will then install their solar farm, connect into the national grid, and sell the power generated on to the utility companies under a power purchase agreement. 

As well as the usual costs associated with defending and settling a claim with the relevant third parties, our policies can be tailored to provide additional extensions of cover. These range from abortive installation costs and liability to pay rent under the lease, to the cost of dismantling the equipment and restoring the land back to its previous condition if a claim successfully prevents their use. 

Looking ahead

The recent reversal of the previous Government’s planning restrictions and de facto ban on onshore wind farms should further increase demand for land suitable for renewable energy projects. And with a wealth of experience in this ever-growing sector, our commercial underwriting specialists can be relied upon to provide cover that’s tailored precisely to your clients’ needs for any of their sites affected by historical title defects.

To find out more, call our underwriting team directly on 01603 617617, or email us at enquiries@cli.co.uk.