Steps to Developing Renewables
Renewable Energy presents one of the best solutions to energy insecurity and to climate change. At Good Energy Generation we want to see everybody get involved with renewables in one way or other but we know that developing a renewable energy project is no mean feat. This is why we have created our Steps to Developing Renewables to help guide you through your project.
We have based our steps around developing a wind energy project but much of this guide will help you whatever technology you are developing.
1. Wind Speed
The economics of a wind farm depend entirely on the wind speed at your site. We have an excellent wind resource in the UK but not every site will be suitable. The first step you must take is to rule your project in or out by finding out if you have got enough wind.
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The NOABL model is a database that holds the average wind speeds right across the UK. At this early stage of your site assessment this is accurate enough to rule your project in or out. You can access the NOABL model via the DBERR website for free.
The database will present you with wind speeds at three different heights, 10m, 25m and 45m. For a large scale turbine, the wind speed at 45m is the figure you are interested in. If this wind speed is 6.5 metres/second (m/s) or above then you have a site that could well become a viable wind energy project.
Beware - wind speeds can vary considerably over short distances! It may be possible for you to access additional data in order to improve on the NOABL information. You can purchase data from the Meteorological Office. This can be useful if you have a "met" station nearby.
Some organisations or institutions make regular recording of weather data, such as schools, colleges, universities or airfields. You can approach these organisations and ask if they are willing to share historical wind speed data with you or at least the long-term mean annual wind speed that they have measured at their site. Double-check the location of their monitoring equipment, what height they have been measuring the wind speed and the reliability of the monitoring equipment.
Eventually you will need to measure wind speed and direction over a twelve month period. This will require wind measurement equipment commonly known as anemometry equipment which will costs approximately £18k to install (in 2009) – an expense you don’t want to rush in to. This local wind data will then be correlated with historic data from the nearest Met Office station to give a long term predicted wind speed for the site. This will form the basis of the energy generation calculations used when financing the construction of the project.
High elevated sites, near the coast and with no obstructions such as buildings or trees usually provide the best wind speeds with low turbulence. However, low lying and inland sites are not excluded from wind energy development. Prevailing winds are usually from between the south and west.
You also will need good access to your site. Taking a series of photographs showing the view out from the proposed site around 360° provides a useful reference.
2. Securing your site
Having legal and long-term rights over the land on which you plan to build your energy project, is essential but often overlooked. If you are the land owner of the planned site then this should be an easy step to complete. If you are developing a community project or own only part of the land for the proposed site, your main focus now is to agree an Exclusivity Agreement and an Option Agreement.
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Investing your time and efforts in the exclusivity agreement and the option to lease agreement at an early stage is time and resource well spent. As stated, if you are the sole land owner and developer, this will not be an issue but if you are one of a number of land owners, representing a community group or a land owner working with a community group, agreeing the terms of project officially and thoroughly at an early stage is essential.
An Exclusivity Agreement allow the developer time to investigate the feasibility of the project further and then present a concrete proposal to the land owner. The agreement would commit the land owner to work exclusively with the group for a predetermined and fixed period. It should also give the opportunity to enter into a more formal Option to Lease Agreement with the land owner if it appears that a viable project can be developed on the land. The advantage of an exclusivity agreement is simplicity and therefore low legal fees until the benefits of the site are further assessed.
When you have established the feasibility of the project and if it looks good, you will need to put an Option to Lease Agreement in place. This means that you as the developer have the right for a period of three or four years, to take a lease over the land required for the wind turbine bases, roads, and the substation and to build the project. This provides the necessary time for you to secure the necessary planning permission for the project and work out how to finance it.
The eventual Lease Agreement will be signed once it is certain that construction of the project can go ahead, i.e. planning is obtained. The Lease Agreement will give the project developer appropriate access and usage rights over the land and will set out the annual rental payment that must be made to the land owner.
3. Assessing your site
You have got your land owner onside and you have a good idea of your wind speed. Now you need to work out the logistics and the costs of your project in more detail. To make this assessment you need to perform a feasibility study.
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To complete a feasibility study successfully we recommend you instruct someone with the necessary experience, namely a renewable energy consultant. The right consultant will be able to assess your site taking into account the technical, environmental and planning challenges. We can recommend Renewable Energy consultants. Complete Your Project Details and we will be able to advise you on the next steps of your project.
A renewable energy consultant will charge you several thousand pounds to complete a feasibility study. The following points are issues that will be researched in the feasibility study.
Grid Connection
Connecting to the electricity grid is an important step and can be costly. Eventually you will need to get a grid connection quotation but at this stage you want your consultant to talk to your Distribution Network Operator (DNO), the company that operates the grid system in your area and tell them your plans. Your consultant will be able to get an estimated figure which will be sufficiently accurate to put into the project’s financial model. Find out who your DNO is here.
Technical data and wind data
To improve the accuracy of your wind data your consultant may look to acquire data from Met Office weather stations locally or other organizations that may have permanent anemometry in place. This can be used in conjunction with standard data from wind turbine manufacturers to estimate what the electricity output and what the noise levels created may be.
Large scale wind turbines need to be a minimum of 400 metres away domestic properties and it is good practice to increase this distance to 700 metres. This distance is based on acceptable noise levels. Wind turbines have been successfully developed to minimise noise and turbine manufactures have exact data on the noise output from their products.
Project Logistics
Wind turbine towers and blades are huge components and transportation to site needs to be fully considered. Your consultant will identify that are suitable access roads, or take into account the cost of building them. Road signs and other ‘street furniture’ may need to be removed and replaced to get the components to site without a hitch. The implications and cost of this should be factored in by your consultant.
Financial Modeling
You need to start looking at the economic viability of your project and your consultant will be able to help you set up a financial model. As your project progresses, you can keep adding the data that you acquire giving you an ever more accurate projection of the projects viability. You can start by including the cost of the grid connection, the turbines, the civil engineering and using your wind speed you can calculate your expected electricity output. At this point, contact Good Energy and we will give you an estimate for your power. Start by completing and submitting Your Generator Details.
4. Talking to stakeholders
Once, you have completed your feasibility study and the project is viable so your next step is Scoping. Scoping involves consulting with various parties that have a vested interest in and significant influence over the outcome of your project.
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Your project may have impacts on local residents, the local ecology and parties that might be in your area like the Ministry of Defence (MOD) even mobile phone companies. Your scoping work will enable you to find out who these stakeholders might be, what their issues are and what measures you may have to take mitigate or remove the impacts that your project has on them.
Here are some of the groups you will need to consult and the action you might choose to take:
Statutory consultees
Your consultant will identify the statutory consultees, stakeholders who may object because a wind farm may compromise their activities. These consultees might include the Ministry Of Defence, mobile phone companies, the RSPB, Natural England and so on. Your consultant will contact these consultees and ask them to raise any issues or objections to your project that they might have.
Ecology and Natural Heritage
Projects can be halted in their tracks when factors such as rare animal species or important archeological sites are compromised. The relevant statutory consultees will be contacted but initial research into any ecological compromise can be conducted during the feasibility study. You can take the first steps by looking at your OS map and identifying if the site is in an Area of Outstanding Natural Beauty (AONB) or if archaeological sites are detailed on the map.
Your Local Authority
Your Local Authority, District or County Council will be the body that will grant approval to your project so it is crucial you have a good line of communication with them. It is best to contact your planning officer, in the early stages of your project to tell them about your project and find out what the local authorities view is of renewable energy developments. You can start this research by visiting their website.
Your Local Authority is perhaps your most important consultee and it is essential that you provide them with all the information they need so that they are made aware of all the issues they need to address. The information you provide the Local Authority in the scoping exercise will determine the extent of information they will request that you submit in your planning application.
Public consultation
To inform the local community and to get their views on your project you will need to hold a public exhibition and consultation. Public feedback can help you to determine the design of your project and get local support which is vital to ensure your project’s success.
It is important to visit residents in advance of your exhibition to explain fully your intentions. It is critical that you provide people with the information that will dismiss the myths about wind farms and allay any concerns. This information can help to win favour for your project whereas unanswered questions can create opposition – good communication is critical.
You need to also consider how you will manage your local media. A well timed, well written press release with all the necessary information is a good place to start.
5. Preparing Your Planning Application
Once you have completed your scoping work and submitted the scoping report to your Local Planning Authority (LPA) they will inform you of the assessments and studies you will be required to submit in your planning application. On larger projects (approximately 5MW and above) you will be required to undertake a full Environmental Impact Assessment (EIA) and submit an Environmental Survey (ES).
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On smaller development projects, your LPA may ask you to complete certain studies whereas larger projects (approximately 5MW and above) will require documentation of design and location considerations, but more particularly will entail an Environmental Impact Assessment. An EIA is a detailed assessment of all the local environmental data taking account of the following considerations:
• species types, movements and numbers;
• distance to the nearest dwelling/road;
• nature conservation areas;
• landscape conservation areas.
• socioeconomic impacts
We recommend that you have a professional project manager to oversee the completion of the EIA. If you have been using a consultant in the early stages of the project you may appoint him to project manage the EIA and coordinate the agents that will perform the various studies. Note that studying bird migration, for example, will require a year’s worth of observational data so an EIA takes time to complete and can be costly. It is not uncommon to spend in the region of £250,000 of a full EIA. This should be factored into your financial model.
6. Submitting your Planning Application
When you have compiled your Environmental Survey or the reports that have been requested by the planning authority, you are ready to make your application. Submit your application with a cheque to cover the application fee to your planning department. After a minimum of 16 weeks your application will be heard by the local planning committee.
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With your Environmental Impact Assessment complete and your Environmental Survey written, you are ready to submit your planning application. There is a fee for making your application that is proportionate to the area of land for which you are applying for planning. In case of a small wind farm this will be several thousand pounds.
Once you have made your application, you will get a confirmation letter from your planning department that will assign you a case officer that you can liase with. Once you receive this letter there will be a wait of sixteen weeks minimum before your application is heard and ruled upon by the planning committee.
During this period the planning officer will be reviewing your application and preparing a report for the planning committee advising them on your project and ultimately recommending whether the project should receive approval or not. It is important to have a good channel of communication with your case officer which will hopefully be the officer that you have liaised with from the outset of your project. A good case officer will prompt you for any additional information they feel is required and get your application to the committee on schedule.
Your application will be submitted to the planning committee with the case officer’s report and recommendations. The possible outcomes may be:
Rejection
The committee may not approve your application. This will be because, in the view of the committee, the project compromises certain aspects of its situation. If this is the outcome you have an option to appeal and will be required to submit further evidence to convince the planning committee otherwise. Appeals can prove to be a very lengthy process.
Deferred
The committee may be undecided and require further evidence. If this is the case you will need to collect further information, submit it to the planning department and your application will be reconsidered at a future hearing. When the decision is deferred it is often because the committee wants to make a site visit to help them make a decision.
Approval
Your application will have been marked by your case officer for approval and the committee agree. Your hard work has paid off and you have the approval to go and build your wind farm!
7. Agreeing Contracts
Now that your plans to build your wind farm have been approved its time to raise finances, source your turbines, select a contractor to build the site, and arrange a Power Purchase Agreement.
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Gaining planning approval for your wind farm is a major hurdle leapt but there is a still a way to go before you cross the finish line. The next four tasks to complete are:
Raising Finances
When it comes to the cost of building a wind farm, a good rule of thumb figure is £1 million for each megawatt installed. It is unlikely that you, the project developer, will hold sufficient cash to fund the entire project and it is likely that you will need to borrow money from the bank or an investor or both.
It is likely that a bank will let you borrow approximately 70% of the cost of the wind farm you plan to build. They will charge you somewhere between 5-8% interest on the debt and will expect you to pay the debt back over a period of 10-15 years. The bank will expect you to raise the other 30% of the money needed, much the same as when you buy a house and you are required to put down a deposit. Some of this ‘equity’ may be raised from an investor. If this is the case they will expect to see a greater return in their investment than the bank and will expect to redeem their initial investment plus 25% over the term of their investment.
There are banks that are especially interested in financing renewable energy projects such as the Cooperative Bank and Triodos Bank.
Choosing your turbines
When you made your planning application you will have made a decision on the number of turbines and their size or installed capacity. There will be certain makes and models that will fit your criteria and now it’s time to choose the best turbines for you. The wind data at your site will help you make your decision and you will begin your detailed anemometry now if you have not already. Your wind data, can be modeled with the performance of your shortlisted turbines and this will tell you which turbines are likely to perform best at your site. These findings, the cost of the turbines and the operations and maintenance support the manufacture can offer will guide your decision. You can research turbine manufacturers at the BWEA Website.
Selecting a contractor
The construction of wind farms is carried out by specialist contractors. Often the turbine supplier that you have chosen will advise you to work with certain civil engineers that are experienced in working with the manufacturers systems. You can research contractors at the BWEA Website.
Agreeing a Power Purchase Agreement
A Power Purchase Agreement (PPA) is the contract you hold with an electricity supplier for the sale of the electricity you generate. Good Energy holds contracts with many independent renewable generators across the UK and we are very interested to talk to you about purchasing your power.
If you are borrowing money from a bank, they will want to see a power contract in place before they will release funds. It is common that the bank will want to see specific terms in the power contract such as the length of the contract and a guaranteed price that the supplier will pay. Good Energy can tailor the contract to the needs of you and the bank, enabling you to get access to the finance you need. We can provide you with an estimate for what we will pay you for your power. Send us Your Generator Details and we will contact you with our estimate.
8. Building your wind farm
Once you have secured the money to build, you are on the home stretch. Now its time to confirm your grid connection finalise you turbine delivery and mobilize your contractors.
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With the necessary money for the project raised, you can confirm the key actions that will see the project completed.
Grid Connection
You will have already asked for and received a quote for the cost of connecting to the grid from your Distribution Network Operator (DNO). Ideally you will have been given a provisional date for the job on the understanding that you project is likely to go ahead. Now you can confirm that date. The grid connection will prepare the distribution network for you to link your generator up to the grid.
Turbine Delivery
With the increasing demand for wind turbines, it is not uncommon for developers to have to wait 12 or 18 months for their turbines to be delivered. This is why it is important to make your order in good time. However, it is likely you will have to put down a deposit of approximately 25% to secure your order. This is money you may well need to raise independently from bank finance for example. This may be equity you will have to raise independently.
Civil Engineering
Before the turbines can be installed the access tracks to carry the turbines from existing roads to the their final location need to be constructed. The crane pads, a hard standing for supporting the cranes need to be built, trenches need to be dug, cables laid and the trenches back filled. Reinforced concrete foundations for the turbines need to be laid and switchroom needs to be built to enable the connection to the local electricity substation.
9. Generating Energy
With all the ground works complete, you are ready to receive the turbines on site, crane them into position, test them and commission them – then you’ll be generation 100% renewable electricity!
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Although there is not much to see but some concrete slabs and some tracks your project is 99% complete. When the wind turbines arrive, the towers will be craned into position the nacelle and the blades attached in a matter of days. Once the turbines have been installed they will be run through a range of tests to ensure they are fully functional. Once the testing is complete, the turbines can be commissioned – This means their absolute connection to the grid can take place, they go into full operation and they begin exporting power to the grid, providing 100% renewable electricity to the UK.