Feasibility

During this initial design stage, the Renewable Energy Developer (RED) evaluates the proposed site and economic feasibility. This process can take two to seven years, and requires significant investment, including infrastructure, and is often concurrent with stages 3, 4 and 5. Independent advisers play a crucial role.

As project planning progresses, as does the development of heritage agreements and cultural heritage management plans. Typically, a renewable energy project may vary greatly from the proposal at the start of the planning process.

The Prescribed Body Corporate (PBC) will need to decide if they want to pursue economic participation, and what that looks like. The RED will start to consider offtake and potential buyers for the power generated.

Project planning

During this planning phase, all parties must document processes and outcomes at every stage, and undertake regular reviews at agreed intervals, particularly when new information comes to light. Sharing this with the PBC, in a timely manner, is an effective way to achieve free, prior, and informed consent (FPIC) at every stage throughout the process and keep the project on track.

The scope for change must be defined within the Indigenous Land Use Agreement (ILUA)/Head Agreement. Activity associated with any decisions made (e.g., based on changes or new information that comes to light) cannot progress in any way without FPIC. Typically, PBCs provide social licence to operate, workforce, community products and services, land and sea management, heritage protection, connection to Country, and sometimes capital. The RED provides expertise, investment, capital, an income stream, employment, and a secure energy source.

Economic opportunities for PBCs

PBCs may choose to participate in a project under an equity partnership or asset ownership model, through capital investment and/or free carry investment. These models allow Traditional Owners to tap into generational wealth during the life cycle of the project. Economic involvement should not be tied to native title compensation.

Incorporating community benefits into the project plan is equally important, and could include secure energy sources, training and employment, housing, health and education programs, cultural and ranger programs for land and sea management, and other activities.

Engaging independent advisers

Independent advisers, with suitable experience and proven expertise, are engaged to provide specialist advice for the specific project. For example, to:

Negotiate the modelling to be used to determine financial and non-financial benefits for the PBC over the life of the project. Equity participation is highly specialised and multi-faceted.
Set up a commercial entity, independent of the PBC, to manage the financial interests in the project.
Review/resolve PBC resources/capacity required for the project – for the negotiation phase and beyond.
Engage finance providers for funding or loan finance.

Independent advisers are appointed by PBCs and funded by REDs, who may propose a list of advisers they are prepared to fund that have proven expertise. It is the RED’s responsibility to fund and facilitate discussions between experts and PBCs to support: heritage agreements; progressing EPA approvals (which includes Social Surroundings, and can take seven-plus years); Heritage Management Plan development; and, undertaking investigative studies, including for rehabilitation plans for Country impacted by feasibility activity/infrastructure. YMAC has in-house expertise and external networks for client PBCs to access. Sharing commercially sensitive information and confidentiality agreements is typical at this stage.