Financial support from communities for renewable energy development – the latest legal update

There has for some time been debate around whether a commitment to make community contributions on the grant of planning permission can be taken into account by planning authorities when considering whether to grant planning consent. Practice has varied over the years and decision making has not been consistent.

However, in Forest of Dean District Council & Resilient Energy Serverndale Limited v R on the application of Peter Wright [2017] EWCA Civ 2012 the Court of Appeal has issued a salutary decision on community contributions and when they can be considered as material to decision makers in granting planning permission. In this case, the planning permission was quashed because it was held that the contribution was not sufficiently connected to the planning use to be necessary.

In essence, if a payment is material to the development, then it can be taken into account and the decision maker can weigh up the benefit of that contribution in the balance of benefits and disbenefits of the scheme. However, if the payment is not material, it must not be considered at all, and if it is, that decision will be flawed. Lawful payments might include support for socio economic benefits directly related to the development, such as job creation, skills training, apprentices, education and climate change awareness.

Here, the community payments of 4% of turnover were found not to be material. The reason for 4% rather than any other figure could not be explained and some payments, it was suggested, might go to community benefits such as a lunch club for the elderly and the purchase of waterproof clothing for children in the community to participate in outdoor activities.

The fact that the development had a purportedly community element which allowed local residents to invest in the scheme had no effect. The Court held that there was no distinction in what was material for this purpose between a community and a commercial scheme.

Despite Government policy supporting community energy initiatives, the lesson of this case is that for community payments to have an influence on the grant of planning permission they must relate to the use of the land and have a planning purpose. That should not detract developers from making voluntary community payments, which may have other community benefits. However, if the intention is to sway the planning committee to grant consent then developers must carefully consider how those benefits are offered.

Forest of Dean District Council & Resilient Energy Serverndale Limited v R on the application of Peter Wright [2017] EWCA Civ 2012

This article was written by Neil Bromwich and Hannah Stevens.