Planning Agreements for Energy Projects UK Guide

What this document is

A planning agreement is a legally binding arrangement between a developer and the local planning authority, sometimes involving other public bodies, that secures commitments connected to a grant of planning permission. In England and Wales, these are most commonly made under Section 106 of the Town and Country Planning Act 1990 and are often called S106 agreements or planning obligations.

They run with the land, meaning subsequent owners inherit the commitments, and they are enforceable by injunction if breached. For renewable energy schemes, these agreements tend to address issues that a simple planning condition cannot adequately capture: phased financial contributions, long-term monitoring duties, decommissioning bonds, community benefit funds, or arrangements for access routes and cable corridors.

The Community Infrastructure Levy (CIL) can also apply in parallel in some authorities, and larger nationally significant infrastructure projects follow a different consent route under the Planning Act 2008 with Development Consent Orders rather than traditional S106 agreements.

How to use this document

1. Work out which consent route applies. Smaller and mid-sized energy schemes usually go through the local planning authority with a Section 106 agreement attached. Larger projects above statutory thresholds, including major onshore wind and solar schemes and significant generating stations, may instead need a Development Consent Order from the Planning Inspectorate, which carries its own obligation framework.
2. Engage early with the planning authority. Before heads of terms are drafted, open discussions with planning officers about what obligations they consider necessary to make the development acceptable. Early engagement often produces more balanced terms than reacting to a draft late in the process, and it gives time to commission the technical reports authorities expect to see.
3. Scope the obligations carefully. Each obligation must be necessary to make the development acceptable, directly related to the development, and fairly and reasonably related in scale and kind. Push back on contributions that do not meet these statutory tests. Typical scope for energy schemes covers highways works, ecological mitigation, community funds, landscape management and decommissioning.
4. Negotiate and document the terms. The agreement is usually drafted by the authority's solicitors and then negotiated. Key points include trigger events for payments, indexation of financial contributions, the scope of any bonds or security, restrictions on assignment, and how variations are handled if the project changes during build-out or operation.
5. Complete, register and comply. The agreement is signed as a deed, registered as a local land charge, and typically completed before or at the same time as the planning permission is issued. After that, the developer must monitor compliance throughout construction and the operational life of the project, keeping evidence of payments made and obligations discharged.

Common questions