15/0652/AMCPP: DISCHARGE of CONDITION NOS. 3(A) & 3(B)

EAST AYRSHIRE COUNCIL

PLANNING COMMITTEE: 23 OCTOBER 2015

15/0652/AMCPP: DISCHARGE OF CONDITION NOS. 3(a) & 3(b)

(FINANCIAL GUARANTEE) OF CONSENT 14/0720/PP

AT LAND NEAR DAREDUFFHILL, DUNLOP, EAST AYRSHIRE

BY DORALVIEW LTD

Report by Head of Planning and Economic Development,

Economy and Skills

Click for Application Details: http://eplanning.east-ayrshire.gov.uk/online/applicationDetails.do?activeTab=summarykeyVal=NTY9CEGF01B00

EXECUTIVE SUMMARY SHEET

PURPOSE OF REPORT

1 The purpose of this report is to present for determination by the Planning Committee an application to discharge the deemed consent per conditions 3(a) and 3(b) of consent 14/0720/PP for a single turbine at land near Dareduffhill. Under the Council’s Scheme of Delegation the application to discharge the condition requires to be determined by Planning Committee as the application relates to the discharge of a planning condition relative to decommissioning, restoration and aftercare of the site.

RECOMMENDATION

2 It is recommended that the application for discharge of Condition 3(a) & (b) be approved for the reason indicated at Appendix 1 of the report.

CONTRARY DECISION NOTE

3 Should the Committee agree that the application be refused contrary to the recommendation of the Head of Planning and Economic Development, Economy and Skills, the application will require to be referred to Council as it would represent a significant departure from Council policy.

Michael Keane

Head of Planning and Economic Development

Note: This document combines key sections of the associated report for quick reference and should not in itself be considered as having been the basis for recommendation preparation or decision making by the Planning Authority.

EAST AYRSHIRE COUNCIL

PLANNING COMMITTEE: 23 OCTOBER 2015

15/0652/AMCPP: DISCHARGE OF CONDITION NOS. 3(a) and 3(b)

(FINANCIAL GUARANTEE) OF CONSENT 14/0720/PP

AT LAND NEAR DAREDUFFHILL, DUNLOP, EAST AYRSHIRE

BY DORALVIEW LTD

Report by Head of Planning and Economic Development,

Economy and Skills

PURPOSE OF REPORT

APPLICATION DETAILS

Site Description:

2 The application site is located on upland farmland and is bounded to the east and south by a coniferous forest. To the west is the C7 public road linking Dunlop and Neilston. The landscape of this area is best described as enclosed and complex with an undulating appearance made up of small hills and knolls. Further north and east the landscape has a more upland, plateau type appearance and to the south the more enclosed and settled lowland type landscape is evident. The application site ranges in height from approximately 230m AOD at the site access on the C7 to approximately 243m AOD within the main body of the application site where the turbine would be located. This places the turbine approximately 26m lower than the AOD of Dareduff Hill (at 269AOD) to the south of the application site. The application site is located on the northern slope of Dareduff Hill and adjacent to a small knoll which rises to just over 245m AOD. Knockmade Moss Provisional Wildlife Site (PWS) covers an extensive area to the west of the C7.

3 Planning Consent was granted by the council for a single 500Kw Powerwind turbine (height 68m) on 28 July 2015 under reference number 14/0720/PP. Permission was granted for a single turbine with a maximum blade tip of 68m (40m to hub and 56m blade diameter) including associated access track, construction of a compound substation and transformer enclosure and the installation of a 11kv underground cable.

4 The applicant has applied to discharge Conditions 3(a) and 3(b) (Financial Guarantee) of Planning Consent 14/0720/PP.

5 Condition 3 (a) & (b) state:

a) At least 3 months prior to the recommencement of development, the developer shall provide to the Planning Authority written details of the bond or other financial provision which it proposes to put in place to cover all decommissioning and site restoration costs, for the written approval of the Planning Authority.

b) No work shall commence on site until the developer has provided documentary evidence to the Planning Authority that the proposed bond or other financial provision is in place and written confirmation has been given by the Planning Authority that the proposed bond or other financial provision is satisfactory.

6 The consent therefore has a number of planning conditions that require to be discharged prior to the commencement of works on the site. In this case Condition 3 (a) & (b) relate to the Financial Guarantee required to undertake and deliver the appropriate decommissioning, restoration and aftercare of the development. This condition was attached to the consent to ensure that there were sufficient funds available for the full costs of site decommissioning, restoration and aftercare.

7 The applicant provided an initial report (10 December 2014) that outlined a scheme of decommissioning, restoration and aftercare. The quantum suggested was £29,000 with a further £10,000 for removal of the track being subsequently added. Ironside Farrar, in conjunction with the Planning Authority, concluded that removal of the access road was not required and should be excluded from the restoration calculations. The applicants report included staggered payments of £3,000 per annum over a 20 year period. The decommissioning report involved:

· Removal of the turbine foundation to just below ground level.

· 5 yearly review of guarantee sufficiency.

· Ability for council to recover costs in specific circumstances.

· Scrap value not included.

8 The Planning Service, via their independent consultants Ironside Farrar, also produced figures for the cost of decommissioning and restoration, which amounted to a larger estimate of £76,691 comprising:

· Preliminaries / Overheads / Fees: £12,782

· Site Restoration: £7,362

· Dismantling, removal and disposal of 1 turbine: £54,778

· Aftercare: £1,769

· Grand Total £76,691

9 Notwithstanding the above, it was acknowledged that with the decommissioning of projects that have large scale dismantling elements, there can be economies of scale by having large plant and the associated staff in place.

10 Ironside Farrar’s cost analysis included the dismantling and removal of the turbine (including ancillary structures), abnormal load movements, crane hire, use of topsoil and seeding and some limited aftercare. Specifically excluded were the removal of watercourse crossings, drainage pipes/ducts and the access road.

11 The Planning Service advised the applicants of the discrepancy between the two estimated costings and the applicants agreed to meet Ironside Farrar’s financial quantum with an Escrow account as the financial guarantee mechanism. The financial guarantee obligation is incorporated into the s.75 legal agreement. A figure to account for inflation was added to bring the full value of the financial guarantee to £88,191. The legal agreement was registered at Registers of Scotland on 21 July 2015.

12 The agreed mechanism is for the guarantee figure to be deposited in an Escrow account as a single upfront payment. East Ayrshire Council Finance Department confirmed on 23 September 2015 that the Escrow funds for £88,191 had been deposited by the applicant.

CONSULTATIONS AND ISSUES RAISED

East Ayrshire Council Finance Section

12 The Finance Section confirmed that the funds had been deposited in the Escrow account.

Noted and accepted.

East Ayrshire Council Legal Services (22 September 2015)

13 No outstanding issues. The financial guarantee quantum and mechanism have been assessed and agreed with the Council’s Legal and Financial Services. Legal Services have accepted that Condition 3 (a) & (b) are satisfied by the mutual agreement of a quantum and mechanism, and payment of the financial guarantee.

REPRESENTATIONS

14 There were no representations received regarding the discharge of this condition.

ASSESSMENT OF DOCUMENTS IN SUPPORT OF DISCHARGE OF CONDITION 3 (a) (b)

15 The applicants came to an agreement over the costs, concurring with the Council’s consultants Ironside Farrar calculations for the decommissioning, restoration and aftercare works. Furthermore, the applicants have entered into a S.75 agreement with the Council to secure an obligation in relation to appropriate decommissioning, restoration and aftercare of the site.

ASSESSMENT AGAINST ANY MATERIAL CONSIDERATIONS

16 The material considerations relevant to the determination of the discharge of condition 3 (a) & (b) are Scottish Planning Policy (SPP), the Council’s Cabinet Report on Decommissioning, Restoration, Aftercare and Mitigation Financial Guarantees dated 21 May 2014, the consultation responses and any representations received in connection with the application.

Scottish Planning Policy (SPP)

17 Scottish Planning Policy was published in June 2014 and states that the planning authority should apply “conditions relating to the decommissioning of developments, including ancillary infrastructure, and site restoration” and also to “secure provision for restoration to return the land to its former status”, highlighting also “the need for a robust planning obligation to ensure that operators achieve site restoration.” The Planning Service has complied with the requirements of SPP by requiring the operator to provide financial guarantees in order to implement the appropriate decommissioning and restoration of the site. The applicant has provided sufficient information to achieve the decommissioning and restoration requirements of SPP.

The Council’s Cabinet Report on Decommissioning, Restoration, Aftercare and Mitigation Financial Guarantees dated 21 May 2014

19 The above mentioned report to Cabinet sets out The Council’s approach for the submission, agreement, implementation and monitoring of financial guarantees that are required in respect of the decommissioning, restoration, after care and mitigation of, inter alia, onshore windfarms.

20 Para 27 of this report states that “the Council’s Finance, Legal and Planning Services will consider, at the earliest opportunity:

· The purpose of any proposed financial guarantee

· The associated risk rating of the proposed financial guarantee with reference to the risk assessment contained in the Appendix to the report, and

· The sufficiency of any quantum proposed taking into account any assessment provided by the independent environmental consultant

The Council’s Finance, Legal and Planning Services have assessed the proposed financial guarantee and the sufficiency of the quantum proposed, in terms of the overall risks involved and is satisfied that the measures in place are sufficient to mitigate the risks which may be encountered with the decommissioning, restoration and aftercare of the site.

21 Para 29 of the Cabinet Report states that “the following matters will be considered by officers when assessing the terms of any financial guarantee proposed:

· The reason why the financial guarantee is required i.e. decommissioning, restoration, aftercare, mitigation or in combination;

· The risk it is required to cover i.e. breach of any planning conditions, associated legal obligations relative to decommissioning, restoration, aftercare or mitigation or insolvency;

· The length of time the financial guarantee is required to cover and its expiry;

· What will constitute a valid call being made on the financial guarantee;

· When can the monies be claimed i.e. before or after money expended by the Council in rectifying any breach, and

· The financial guarantees quantum profile and the triggers for reduction in value and associated timescales.”

All the above issues have been taken account of in the S. 75 obligations, and also Condition 3 attached to the consent.

Consultation Responses

22 The Councils Finance Services has indicated that the Council does not accept the inclusion of the scrap value within any bond, and both the Council’s consultants and the applicants have assessed the decommissioning restoration and aftercare costs on that basis. The financial guarantee quantum and mechanism have also been assessed and agreed with the Council’s Legal and Financial Services.

Representations

23 No representations have been received in connection with the application to discharge condition 3 (a) & (b) of the planning consent.

FINANCIAL AND LEGAL IMPLICATIONS

24 The Council is committed to securing appropriate Decommissioning, Restoration and Aftercare of development sites as indicated in the Council’s Cabinet Report on Decommissioning, Restoration, Aftercare and Mitigation Financial Guarantees dated 21 May 2014. In this case both the financial guarantee mechanism and the quantum of the financial guarantee have been agreed between the applicant and the Council.

25 There are potential financial implications for the Council in coming to a view on this application to discharge the planning condition as, should the Planning Committee be minded to refuse the discharge of the condition, this could lead to an appeal by the applicant. Furthermore, if the Council is considered to have acted unreasonably in refusing to discharge the planning condition, a claim for an award of expenses could be made by the applicant. Discussions between Planning /Legal Services and the applicants have resulted in a legal agreement to provide a financial guarantee for the decommissioning, restoration and aftercare of the wind farm.

COMMUNITY PLAN

26 Managing development proposals to mitigate impacts of development on the local community and wider environment is clearly consistent with community plan objectives and outcomes. In addition, ensuring financial guarantee values are adequate and associated legal agreements effective is a critical part of this management process.

CONCLUSIONS

27 This application is consistent with the requirements of Condition 3 (a) & (b), in that the submitted details satisfy this Condition. In summary, condition 3 (a) & (b) requires the Company to provide to the Planning Authority details of the bond or other financial provision which it proposes to put in place to cover all site restoration costs the expiry of this consent. As such, the information submitted complies with the requirements of Condition 3 (a) & (b).

28 As indicated in the report, this application is to consider the discharge of condition 3 (a) & (b) (Financial Guarantee) of the planning consent for the Dareduff Hill turbine (14/0720/PP). The material consideration section of this report indicates that the applicant has provided sufficient information to discharge parts (a) and (b) of this planning condition. It is considered that the submission by the applicant can be supported in terms of Scottish Planning Policy, the Council’s Cabinet Report on Decommissioning, Restoration, Aftercare and Mitigation Financial Guarantees dated 21 May 2014 and the consultation responses.