Background on Site Right Agreements Sample Clauses

Background on Site Right Agreements. The foundation of any solar energy project involving a PV system owner and an owner of real property is the real property site right agreement. The site right agreement (often referred to as a “site control” agreement) not only provides the PV system owner the legal rights it needs to access and use a particular property for the installation, development, and operation of a PV system, but also offers the first level of security and comfort for lenders and permitting authorities, who, by the PV system owner’s financial and legal investment into securing long-term site rights, are assured that the project is not speculative but has an actual, physical location secured by a written contract. The type of site right agreement used—a license, easement, or lease—is usually the first matter negotiated because the right or interest sought to be granted (or given) may be dictated or guided by legal restraints or investor desires. Other factors include the type of system installed (photovoltaic (“PV”) or concentrated solar power (“CSP”), for example), location (for example, a “green” site or a former landfill), the type of installation (rooftop or ground-mount), and the type of landowner or host (commercial, residential, municipal, or non- profit). These restraints and desires sometimes create an immediate tension between the owner of property and the PV system owner. This tension—which, for the property owner, may be between its desire to benefit from renewable energy produced on-site and its desire to minimize encumbrances on its title to the property—is not unique to municipalities or other public entities entering into long-term power contracts involving public real property. Each party has an interest to protect and to further, and recognizing the necessity and value of each party’s interest is the first step to preparing and executing a site control agreement that serves each party’s needs. As an initial matter, state or local laws may dictate what type of real property rights a municipality may grant. Applicable laws may prevent a municipality from granting leasehold interests in public property without a public notice and bidding process, or a statute may require a public bidding process if the proposed lease will be greater than a certain period of time (e.g., five or ten years). Applicable laws may also dictate certain terms, such as the duration, rights of early termination, insurance requirements, and so forth. As part of the initial investigation and d...
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Related to Background on Site Right Agreements

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