With Ontario getting on the green energy bandwagon, lawyers who practise real estate law face the prospect of representing clients who have been approached by alternative power developers seeking to set up wind farms or solar panel projects.
Those clients could range from people who own large parcels of property to individual homeowners within proximity of a proposed wind farm who fear their land values will plummet in the event an alternative energy project receives approval.
John Goudy, a litigator at Cohen Highley LLP in London, Ont., whose practice deals with the area of land use and related environmental issues, has been retained by several farmers recently who’ve been approached by green energy developers seeking to lease a portion of their property to set up wind projects.
He acknowledges that wind farms are often opposed by neighbouring residents concerned about health issues and, perhaps more significantly, property values should a wind project get approval in their neighbourhood. “The projects that are most controversial are the wind projects,” he says.
“In talking to land owners about whether they should enter into a contract to allow companies to come on to their property and build turbines, I tell them that one of the things they should look at is liability and what sort of potential liability they have towards their neighbours.
That project on their land could cause some damage or loss of property value for neighbours around them.”
Surrounding communities are often concerned about health issues from the continual rotation of wind turbines, along with a decrease in land values due to people’s view of a wind farm from local residences.
Under the province’s MicroFIT program announced last August by the Ontario Power Authority, future projects will receive a guaranteed price of 64.2 cents per kilowatt hour for 20 years.
Yet Goudy points out that from a legal perspective, the projects aren’t as simple as they appear.
“There’s a whole host of financial issues developers have to deal with, such as insurance costs, financing, warranties. It’s a very complicated process.”
In Thunder Bay, Ont., there’s significant opposition to plans for a wind farm proposed along a mountain in the south end of the city.
Douglas Shanks, a partner at Cheadles LLP there, acknowledges the opposition from neighbouring community groups to the proposed power project.
“In this particular case, there were a lot of concerns raised by residents who live in the community,” says Shanks. “One of the most significant issues is their view and their health.
That has been a huge issue in the project, along with the potential noise, the effects on wildlife, and the impact it could have on other business operations in the community.
The perception is that the wind farm, being located close to a residential area, could have an effect on their property values, so there is a lot of opposition.”
Juli Abouchar, a partner and environmental law specialist at Willms & Shier Environmental Lawyers LLP in Toronto, notes that wind projects have indeed caused reductions of property values in some jurisdictions.
She points to a wind farm established in Ontario’s Bruce County as an example. There, residents have organized themselves over the fact that their property values have indeed decreased due to the view of the turbines from the neighbourhood.
“Some people have had difficulty selling their property because of the windmills located nearby,” she says.
But the Liberal government has been pushing to develop alternative energy projects. “Renewable energy has been a big push by this provincial government and they have streamlined the process of approval for these projects,” Abouchar says.
As a result, it’s relatively easy for alternative energy developers to get the green light. However, Abouchar points out that there are ways for property owners to appeal government decisions, which she acknowledges “could cause some uncertainty in a real estate deal” as the province is more inclined to approve an alternative energy project than not.
Solar panel projects haven’t met with the same degree of opposition largely because they’re more benign visually.
In Bruce County, the community is well-organized and has created a web site highlighting its concerns. The group is calling for a moratorium on wind turbine projects until a health study takes place.
Ultimately, while alternative energy projects sound like a great means to reduce carbon emissions and global warming, wind developments in particular will inevitably be prone to opposition when they’re located near a community.
As a result, lawyers will find themselves called upon by homeowners to help contest projects over the effects on their property values.
For more on this issue, see "Good for lawyers, bad for environment."