Jonathan Wright discusses the growing renewable energy sector

Entertaining lawyers

It’s difficult to make yourself sound exciting and relevant when you tell people that your main job is working as a property lawyer. After all, as anyone who’s studied Law will tell you, the Law of Property is really quite a dry area. Of course, for those of us who live and breathe Property, it is secretly known that it is a lot more interesting in practice. It is after all about deals, solving problems and human relationships.

Yet one of my clients once said to me that, in his view, most renewable energy lawyers are frustrated property lawyers. I very much fit that bill. I find renewable energy engaging as it utilises many of the skills of being an effective development lawyer in schemes which are often novel and relatively untried.

I’ve met a good few aspiring young lawyers recently and almost all become unusually engaged when you tell them that you have developed a specialism in renewable energy.

A problem that won’t go away

With large pink boats holding up the traffic in Oxford Circus and David Attenborough talking about plastic in oceans, human effect on the Environment has never really been a hotter topic. Yet at the same time, we humans need and use a lot of electricity.  Finding ways of generating electricity from renewable sources, in a viable and sustainable way, is a key part of the solution to the problem.

Fortunately in the UK and across Europe and the wider world we have lots of creative minds who have come up with ways of using renewable energy. Through my work as a lawyer in this sector, I have been privileged to not only see what is being developed but also how we can structure the deals to deliver renewable power.

A new way of delivering power

I don’t think that it is widely known, but almost all energy production relies on some level of subsidy to make it viable. For example, high levels of feed-in tariffs were necessary to offer on solar when it became widely available in 2010. However the market has worked very efficiently over the last decade to drive down the cost of solar panels.

As a result, I have recently concluded solar deals which are completely subsidy free. The key to these deals are power purchase agreements. Classically a fund conventionally buys the bricks and mortar of (say) a shopping centre let to retailers in order to provide an income stream. In renewable deals, the fund builds the renewable energy source and then harvests the regular payments from the occupiers for the purchase of that power.  Of course you need to know how you can protect yourself and what you can do if your occupier doesn’t pay you. That is where the skills of good lawyers come in.

Creative solutions

There are certain occupiers that use vast amounts of electricity. Driven by a desire to reduce their energy bills they are increasingly turning to renewable power as a solution to this. My favourite scheme was a supermarket car park in Italy. There were some shady roofs under which to park your car in the searing heat. On top of each roof were solar panels and a board inside the supermarket showed how much energy they were generating to power the supermarket. I’ve acted on schemes where whole roofs are turned into parks of solar panels and the factory below reduces its energy costs materially.

A good example of a clever marriage in this area is data centres. They use huge amounts of power and even banks of solar panels on the roof will not be enough. As a result they are siting themselves alongside producers of renewable energy such as on-shore wind farms or waste to energy plants.

As they say in Property, location is everything and even airports now are exploring how they can match their own power demands with the large undeveloped spaces around their runways. Ground-mounted solar farms are enjoying a new renaissance as a result.

New challenges

As with any fast developing area, it is the job of lawyers to consider carefully how to protect clients when matters go wrong, as they typically sometimes do. I learned a lot from dealing with one renewable energy scheme that had fallen into administration. The temptation to take short-cuts can be irresistible on occasions, however there is real wisdom in investing sensible money on legal advice at the outset.

In truth there are few lawyers in the United Kingdom who are dedicated renewable energy specialists. For those of us who are lucky to do a lot of work in this sector, it is creative and rewarding. At the very least, it does enliven some dinner party conversations.

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