Introduction

As the renewable energy sector continues to expand across New South Wales, local councils and developers are increasingly utilising planning agreements to manage the impacts and benefits of large-scale projects such as solar and wind farms.

This article provides an overview of what a planning agreement is, its legal context, and its specific application within the renewable energy industry.

What is a Planning Agreement?

A planning agreement is a voluntary agreement or other arrangement between at least one planning authority and a developer:

1. who has sought a change to an environmental planning instrument; or
2. who has made, or proposes to make, a development application or application for a complying development certificate; or
3. who has entered into an agreement with, or is otherwise associated with, a person to whom a) and b) applies,

under which the developer is required to make a development contribution to be used for or applied towards a public purpose.

Legal Framework

In New South Wales, planning agreements are governed by the Environmental Planning and Assessment Act 1979 and its regulations. This legislation outlines the legal and procedural framework for planning agreements, including preparation, exhibition, execution and reporting.

The framework is also supported by the Planning Agreements Practice Note issued by the NSW Planning Secretary, and where applicable, the Benefit-Sharing Guideline (November 2024): Guidance of large-scale renewable energy projects issued by the NSW Department of Planning, Housing and Infrastructure.

Key Features of Planning Agreements

• Voluntary and Negotiated:

Planning agreements are not mandatory.

A development consent condition may require entering into a planning agreement, but only if the developer has made an offer and the required agreement is in the terms of that offer.

• Public Purpose:

Development contributions must be used for or applied towards a public purpose. Public purpose is defined in the legislation.

• Transparency:

Draft planning agreements must be publicly exhibited, with an explanatory note, allowing the community to provide feedback before the agreement is finalised.

Also, a register of planning agreements and specified financial records for each financial year relating to a planning agreement must be published online.

• Flexibility:

A planning agreement can wholly or partly exclude the application of other development contributions and provide for more flexibility so far as the nature, value and timing of the contributions is concerned.

Therefore, each planning agreement can be tailored to the unique needs of the local area and the specific impacts of the development.

Application in Renewable Energy Projects

Renewable energy developments can have significant local impacts, both positive and negative. Planning agreements provide a mechanism for councils and developers to address these impacts collaboratively. For example, a wind farm developer might agree to fund road upgrades, contribute to local environmental programs, or support community projects as part of the planning agreement.

By providing a flexible, transparent, and collaborative framework, these agreements help ensure that the growth of renewable energy delivers lasting positive impacts for local areas.

Do you require Advice?

Kell Moore Lawyers Planning and Environment Team is led by Accredited Specialist Matt Rogers and supported by a team of experienced lawyers who can assist with all aspects of renewable energy projects including negotiating and drafting planning agreements.

This article is for general information only and does not constitute legal advice. You should not rely on this information without seeking professional legal advice.