Compensation for residents nearby and the local society

Revenue sharing with nearby residents

SCA has decided to move ahead of the government inquiry “The Value of the Wind” and introduce its own compensation model, inspired by the inquiry’s proposals, for residents living near new wind farms developed by SCA.

The model in brief:

• Nearby residents will each year, throughout the lifetime of the turbine, be entitled to a share of the turbine’s revenue. The size of the compensation depends on the distance from the turbine and the turbine’s generated revenue.
• A building qualifies for compensation if, at the latest property assessment, it is classified as a single-family house (including holiday homes), an owner-occupied apartment, or a rental building, and if it was constructed before the wind farm received legal approval.
• Residents living within 1,000 meters of a wind turbine are entitled to full compensation (0.25 percent of the turbine’s electricity market revenue). Residents within a distance of up to ten times the turbine’s total height are also entitled to compensation, but at a reduced level.
  Example: If the turbine is 290 meters high, you are entitled to compensation if you live within a 2,900-meter radius. A property can receive compensation from a maximum of two turbines.

In addition to revenue sharing with nearby residents, SCA allocates 0.5 percent of the wind farm’s electricity sales revenues as a community fund for the local area throughout the productive life of the park. The funds are intended to promote the development of nature and culture, recreational activities, tourism, or infrastructure, and can be applied for by associations, village communities, schools, or other locally anchored legal entities that fall outside the scope of municipal responsibilities.

Currently, SCA—either independently or in partnership—has a number of wind power projects in the planning stage which, if realized, will be included in the revenue-sharing scheme for nearby residents.

Compensation example

Assuming an average electricity price of 0.40 SEK/kWh, weighted with a factor of 0.75 (since wind power production negatively correlates with the spot price), the revenue sharing is based on a level equivalent to 0.30 SEK/kWh.

A wind farm developed with 290-meter towers, 8 GW turbines, and 3,500 full-load hours could then be expected to generate approximately 21,000 SEK per year to a nearby resident entitled to the maximum revenue share. For residents at greater distances, compensation decreases with distance and ceases entirely beyond 2,900 meters.
For residents located near two turbines, the compensation is doubled, based on the distance to each turbine.