Principle 2: Shared benefits with communities

Identify opportunities to engage with and share the financial and other benefits of the development with the local community throughout the project’s lifecycle.

Benefit sharing is distributing, or sharing, the financial and other benefits of a renewable energy development with the local community and other stakeholders.

Benefit sharing activities aim to engage community members in close proximity to the development, as well as other nearby residents.

Benefit sharing is integral to a community’s sense of fairness and ensures that the economic benefits of renewable energy development are distributed relative to the potential impact of the project on the local community. Benefits therefore need to be proportionate with the scale of the project and the level of change or disturbance experienced by the community, but they do not necessarily have to be direct compensatory payments.

Benefits offered should be negotiated with communities in good faith, with transparent, open and respectful negotiations between developers and all impacted stakeholders. There is a wide range of benefits that can be shared with communities, or activities that can be funded and supported through renewable energy development.

Benefit sharing mechanisms

The avenues by which benefits are shared with communities, landowners and local investors are typically referred to as benefit sharing mechanisms.

Examples of benefit sharing mechanisms include:

  • payments to host landholders
  • contributions to councils
  • community enhancement funds that provide grants to local groups, which may be managed by the renewable developers, community representatives or local councils
  • sponsorship of local community organisations and/or legacy community benefit initiatives
  • neighbourhood benefit programs (including neighbour payments or solar photovoltaic (PV) installations)
  • beyond compliance level activities associated with visual amenity (e.g. tree planting or screening)
  • innovative products (including community energy efficiency programs)
  • innovative financing (including co-investment and co-ownership opportunities).

Coordinated benefit sharing

Coordinated QREZ development in a particular region means that there will be several projects delivered in that area over time. Under current arrangements each project would take a different approach to sharing benefits with local communities proportionate to their project impact.

If the benefit sharing mechanisms were coordinated across projects participating in a QREZ, the community could see greater benefits. This could allow resources to be pooled and benefits for communities scaled proportionate to the level of investment the QREZ represents. This could take different forms such as setting different benchmarks for community benefit schemes or combining funds with a greater level of community control over the outcomes.

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