Preliminary Access Licences: What you need to know

A Preliminary Access Licence is typically the first document a potential renewables land partner will send you if they are considering your land for a solar, wind, or battery project. Negotiating this document correctly will set you up for success if the development proceeds.

What is it for?

The licence allows a renewables developer to understand your land better, and determine whether it is suitable for a project. This can include temporary access for installation of monitoring equipment (e.g. a wind met mast) and for consultants to conduct:

• environmental assessments;

• soil testing;

• cultural heritage investigations;

• surveying and mapping;

• installation of temporary met masts for wind monitoring;

• geotechnical testing; and

• ecological studies.

In many cases, the developer is still deciding whether the project is commercially viable at this stage.

Isn’t it low risk, why should I get a lawyer to review it?

A legal review is essential to ensure major risks are managed, especially if your land is your livelihood. What happens if a consultant injures themselves on their land? How will you avoid them tracking in pest plant species and who pays to fix it if they do? Has the developer included a broad release or indemnity? These risks can all be managed, but you need to negotiate them into most documents.

The agreements can also include other terms such as exclusivity arrangements with the developer that prevent landholders from negotiating with competing developers during the term. It is important to get advice on the implications of these and other extra terms.

How Long Do These Agreements Last?

Some access agreements run for 12 months, while others may continue for several years with extension options that the developer can exercise automatically if needed. In larger renewable energy projects, the investigation and approvals phase can take several years before any construction on the project actually begins.

It is important to check:

• the exact term of the agreement;

• whether the developer controls extension rights;

• whether you can terminate the agreement; and

• what happens if the project does not proceed.

What Rights Are Developers Asking For?

The scope of access rights can vary significantly between agreements.

Some are relatively limited and only allow occasional inspections. Others may permit more extensive access and rights across the property.  Landholders should clearly understand:

• which areas of the property can be accessed;

• how much notice must be given before entry;

• whether access is restricted during harvesting, lambing or other sensitive periods; and

• who is responsible for damage caused during investigations.

What Happens After the Access Licence period ends?

If the developer decides to progress the project, you will generally receive a proposed option agreement, and accompanying lease documents and easements for legal review. The option agreement gives the developer the option to elect to take a long term lease and easements over parts of the land for the project to operate.  

The developer will generally allocate a budget for you to engage a lawyer to review them, because they understand how important that advice is.

The Importance of Early Advice

Renewable energy agreements are complex commercial contracts, even at the preliminary stage.

Early legal advice helps landholders:

• understand exactly what rights are being granted;

• negotiate practical protections for farming operations;

• limit unnecessary risks;

• clarify compensation arrangements; and

• avoid committing to obligations that become difficult to unwind later.

By understanding what you’re committing to upfront, and getting ahead of common issues, you pave the way for a productive and beneficial relationship with the developer long term.