Decision of the Scottish Land Court

Viking Energy Wind Farm LLP (Applicant) v Crofters having rights in the Common Grazings of the Townships of Sandwick, Sweening & Laxo and Other Common Grazings (Respondents)

Case reference SLC 31/16
before
Lord Minginish, Chairman, and Tom Campbell
5 September 2018

INTRODUCTION

[1] This is an application by Viking Energy Wind Farm LLP (“VEWF”) for the consent of the Court to a scheme of development under sec 19A of the Crofters (Scotland) Act 1993 (“the Act”). The scheme in contemplation, which is described in more detail in the scheme document appended to this decision, is for a large wind farm, comprising 103 (down from an original 127) turbines with a maximum tip height of 145 metres over an area extending in all to about 10,424 ha of central mainland Shetland north of Lerwick, about 8,575 ha of which is subject to crofting tenure. It has planning consent in terms of (i) consent granted by Scottish Ministers under sec 36 of the Electricity Act 1989 and (ii) a direction issued by them under sec 57(2) of the Town and Country Planning (Scotland) Act 1997 that planning permission be deemed to be granted, all on 4 April 2012. It has aroused strong feelings locally and aspects of the planning process have been the subject of judicial review proceedings culminating in the Supreme Court’s decision in Sustainable Shetland v Scottish Ministers 2015 UKSC 51.

[2] VEWF is a limited partnership between Viking Energy Shetland LLP (“VES”) and SSE (formerly Scottish & Southern Electric), each with a 50% share. VES is 90% owned by Shetland Charitable Trust (“SCT”), with the remaining 10% owned by certain individuals who were involved in another wind farm development on Shetland.

[3] The present application originally elicited 20 responses, including one from Sustainable Shetland, a group created, as we understand it, to oppose the wind farm. By our order of 12 October 2016 we decided, in light of the Court’s decision in Coigach Wind Power Limited v Achiltibuie Common Grazings Shareholders & Ors SLC/109/05, decision of 17 June 2016, that 13 of those were not from competent objectors. That left, as competent respondents, Mr John Anderson of Lunklet, East Burrafirth, Bixter, who has a share in one of the affected common grazings, Mr James Oliver Cheyne, a crofter of East Pund, Aith, Bixter, Mrs Lorna Moncrieff, tenant of the croft of Southtown, Aith, Bixter, Mr David Nicolson and Mrs Elizabeth Nicolson, who have two self-catering holiday properties at Aith, Mr James Peter Nicolson, Clerk of Aithsting Grazings Committee, and Mrs Kerry Tait, tenant of the croft of Northtown, Tumblin, Bixter. Although we had ruled that Sustainable Shetland, as such, were not competent objectors, we allowed Mr Anderson and Mr Cheyne to be represented by Mr James Mackenzie of that organisation as a lay representative in terms of Rule 100(3)(b)of the Court’s Rules.

[4] We heard the application at the Islesburgh Community Centre, Lerwick on 2, 3 and 5 July and carried out an inspection (concentrating on the locality of the homes of the objectors who appeared at the hearing) on 4 July. Neither Mr James Nicolson nor Mr & Mrs David Nicolson appeared at the hearing, so those who appeared were Mr Mackenzie on behalf of Mr Anderson and Mr Cheyne, Mrs Tait, assisted by her husband, and Mrs Moncrieff. The respondents had no legal representation. The applicants were represented by Miss Ailsa Wilson and Mr Marcus McKay, both senior counsel.

LEGISLATION

[5] Section 19A of the 1993 Act is as follows:

“19A Schemes for development

(1) The landlord (or owner), or any person acting with the consent of the landlord (or owner)—

(a) may by application to the Land Court seek its consent to—

(i) croft land or common grazing; or

(ii) land near to croft land or common grazing if rights and liabilities in relation to the croft land or common grazing would be affected,

being developed in accordance with a scheme appended to the application; or

(b) may intimate to that Court that every person who has rights in or over croft land or a common grazing consents to its being developed in accordance with a scheme appended to the intimation,

and the applicant shall send a copy of the application or as the case may be of the intimation (and, in either case, of the appended scheme) to the Commission.

(2) Consent under paragraph (a) of subsection (1) above is not to be given unless the Court is satisfied—

(a) that the development is for a reasonable purpose;

(b) that to carry it out would not be unfair;

(c) that the scheme provides for there to be fair recompense to each member of the crofting community in the area affected by the development for the effects of the development (including, in relation to the croft land of each such member, recompense at least equivalent to the recompense which the member might be expected to have obtained had that croft land been resumed); and

(d) that, were the development carried out—

(i) that community would be likely to benefit financially; and

(ii) such benefit would be at least commensurate with any financial benefit which the members of that community might obtain on the development proceeding other than by virtue of this section.

(3) For the purposes of subsection (2) above—

(a) the definition of “reasonable purpose” in subsection (3) of section 20 of this Act applies as it does for the purposes of subsection (1) of that section;

(b) it is unfair to carry out a development only where to do so would have significant adverse consequences for one or more of the members of the crofting community in the area affected by the development and either those consequences would be disproportionately greater than the adverse consequences for the other members of that community or there would be no adverse consequences for those other members;

(c) whether recompense is fair is to be determined having regard both to the value of the development and to its effect on the member in question; and

(d) an effect for which there is to be fair recompense may be an effect of any kind whatsoever (and in particular need not be an effect on a croft qua croft).

(4) An application under paragraph (a) of subsection (1) above or intimation under paragraph (b) of that subsection shall—

(a) be made in such form; and

(b) be accompanied by such fee,

as the Court shall specify; and the Court may make different provision for different categories of case.

(5) Provision made under subsection (4)(a) above shall include provision as to the form and content of the appended scheme.

(6) A person making an application under paragraph (a) of subsection (1) above or giving intimation under paragraph (b) of that subsection shall forthwith give public notification of the application or intimation.

(7) Within 28 days after the public notification is given (including the day on which given)—

(a) the Commission; or

(b) any other interested party,

may submit to the Court written objections, on one or more of the grounds mentioned in subsection (8) below, as respects the application or intimation; and the Court shall hear the objectors (if any) before determining whether to give consent under this section or as the case may be before determining whether to proceed under subsection (10) below as respects the intimation.

(8) The grounds are—

(a) that the development is not for a reasonable purpose (the definition of “reasonable purpose” in subsection (3) of section 20 of this Act applying for the purposes of this paragraph as it applies for the purposes of subsection (1) of that section);

(b) that to carry out the development would be unfair to the crofting community;

(c) in the case of a submission under paragraph (a) of subsection (7) above, that the scheme does not provide for there to be fair recompense to each member of the crofting community;

(d) in the case of a submission under paragraph (b) of subsection (7) above—

(i) that to carry out the development would be unfair to the objector;

(ii) that the scheme does not provide for there to be fair recompense to the objector;

(e) that, were the development to be carried out, the crofting community would be unlikely to benefit financially;

(f) that, were the development to be carried out, any financial benefit to the crofting community would not be as mentioned in sub-paragraph (ii) of subsection (2)(d) above.

(9) The Court shall, whether or not there is a hearing under subsection (7) above, give reasons for any such determination.

(10) On—

(a) giving consent under this section; or

(b) determining to proceed under this subsection as respects an intimation,

the Court shall advise the Commission that it has done so and provide them with a copy of the scheme in accordance with which the development is to take place; and the Commission shall enter that copy in the Register of Crofts.

(11) When so entered the scheme shall, in so far as its terms so provide, be binding on—

(a) the landlord (or owner);

(b) any member of the crofting community in the area affected by the development;

(c) any person who, though not described in paragraph (b) above, is—

(i) a tenant of a croft; or

(ii) a holder of grazing rights,

in that area; and

(d) the successors to the persons mentioned in paragraphs (a) to (c) above.”

WITNESSES

[6] For the applicants evidence was given by Mr Graeme Blackett BA(Hons), MIED, MEDAS of BiGGAR Economics Ltd, Penicuik, Midlothian; Dr Simon Zisman PhD, MSc, BSc (Hons), Ecology Director of RPS Ecology Consultancy, Edinburgh; Mr Jonathan David Soal BSc(Hons), Development Project Manager of renewable energy projects with SSE Generation Development, Perth; Mr Aaron Priest BA(Hons), MIED, the applicants’ Head of Development and Strategy; and Mr Timothy John Kirkwood, BSc(Hons), MRICS, of CKD Galbraith, Chartered Surveyors, Inverness. In addition witness statements were submitted on behalf of Stuart Charles Dow, Land Team Manager, SSE Generation Development, Perth, and Mr David Robert Hegarty, Construction Project Manager, SSE Generation Development, Glasgow, in terms of Rule 34(1) of our Rules but they were not called as witnesses, not having been required to attend for that purpose by the respondents. Their statements therefore become their evidence in terms of paragraph (4) of Rule 34.

[7] For the respondents, evidence was given by Mr Anderson, Mrs Tait, Mrs Moncrieff and Mrs Moncrieff’s son, Mr John Moncrieff. We found all of the witnesses credible and reliable.

EVIDENCE

[8] Since there was no great conflict on the facts, it will suffice to summarise the evidence. We should record that at the outset Miss Wilson helpfully advised that, rather than disrupt the flow of the evidence by taking an objection to relevancy every time the need arose, she was content for the whole evidence to be heard under reservation as to relevancy and competency, other than where an irrelevant line of questioning was put to witnesses in cross-examination.

The applicants’ evidence

[9] Mr Blackett was the author to two reports, production 28 and 48 (2016 and 2017), on “Wind Farms and Tourism Trends in Scotland”. The essence of his evidence was that “Based on the available research on the topic … there is no reasonable basis to expect negative impacts on the tourism economy” (Witness Statement, para 2.2). This conclusion was based on research carried out by Mr Blackett’s company, BiGGAR Economics. Its impartiality was challenged on the basis that they act for wind farm developers but the challenge was resisted by the witness on the basis that they also act for clients involved in tourism (about 50-50 in terms of income) and the research had been carried out in order to inform both sectors. Mr Blackett in turn questioned the impartiality of a critique of his work produced by Mr Douglas Wynn BSc (Soc) MSc (Econ) (productions 16 and 60) on the basis that Mr Wynn (who was not called to give evidence) often gives evidence critical of wind farms on behalf of the John Muir Trust. Mr Blackett made the point that Mr Wynn’s work was merely a methodological critique of his (Mr Blackett’s) work, was not based on any research of his own and did not advance its own conclusions. Mr Blackett had nevertheless re-examined his own approach in light of Mr Wynn’s critique but had found no reason to change either his methodology or his conclusions. He made the point that the Environmental Statement produced for the purposes of the planning application for the development had concluded that there would be no significant effects on tourism and recreation (the relevant chapter of that Statement is production 44).

[10] Dr Zisman spoke to his extensive experience of managing and delivering a wide range of ecological and ornithological projects for commercial clients, including wind farm developers, and public sector clients (such as Scottish National Heritage and Forestry Commission Scotland) over his 10 years in his present position. He has over 25 years’ experience in the environmental sector. His evidence centred on the Habitat Management Plan (“HMP”), production 21, which had been prepared by his company for this development for planning purposes, its purpose being to show what remedial work was proposed to mitigate the predicted impact of the wind farm on blanket bog and whimbrel. The Scottish Ministers had been concerned that “the peatland ecosystem is in serious decline and suffering extensive degradation” but were satisfied that “[t]he windfarm’s expansive Habitat Management Plan will restore peatland and offers benefits to a whole range of species and habitats …” (letter from the Scottish Government to the applicants intimating the grant of planning consent, dated 4 April 2012, production 20).

[11] The HMP, which was presently with Shetland Islands Council for approval, would deliver 260 ha of blanket bog mitigation. Approval was expected. Extensive surveying of the existing state of the blanket bog had been carried out with a view to identifying candidate areas for restoration within common grazings. Production 22, a Supplementary Report to the HMP, contained the results. Production 4C1, which the witness had prepared, showed, in map form, the candidate areas which had been identified, amounting to 1100 ha, significantly more than required for mitigation.

[12] The HMP also dealt with ornithological issues and Scottish Natural Heritage (“SNH”), in terms of their response to the draft HMP (production 43), appeared to be satisfied that it met their objectives in relation to birds.

[13] In cross-examination Mr Mackenzie put it to the witness that the present HMP was much reduced in scale and quite different in quantity and quality from the original but the witness thought it, if anything, more rigorous. Part of its purpose was to inform Mr Kirkwood’s assessment of the effect of the development on crofting land. He accepted that the blanket bog in the Aith area, which is on the west side of the development, was less degraded than in the Nesting area on the east. Asked if the restoration areas were likely to be some distance from where construction took place, he said it would be a mixture of both, some areas being in close proximity, some further away. He was unable, for want of relevant expertise, to answer a question from Mr Tait as to whether peat would be excavated down to bedrock level during construction.

[14] Mr Soal was Development Project Manager for the Viking Energy Wind Farm Project from April 2015 to December 2017 but he explained how the project had been in contemplation since 2005 and outlined its 10 year progress through the planning process. He described the nature of the works to be done. As Development Project Manager one of his roles was to ensure that the HMP could be delivered. He was satisfied that it could. In cross-examination by Mr Mackenzie he accepted that the final version of the HMP was still with Shetland Islands Council for approval. He couldn’t say when a decision might be expected. Asked by Mrs Moncrieff about what sort of incidental planning applications might have to be made in the pre-construction and construction processes (something to which his witness statement refers) he explained that these would be things like the need for an extra piece of track to be constructed or the re-routing of track which proved difficult to construct as originally planned. These incidental applications would be to Shetland Islands Council, not the Scottish Ministers, and could not include major things such as an increase in the number of turbines.

[15] Mr Priest, a native Shetlander, is Head of Development and Strategy for the applicants. He has been involved with this project since its inception in 2003. He spoke to the financial benefits from the scheme for Shetland via the creation of a fund to be known as the Shetland Community Investment Fund (“the Fund”) which will be administered by Shetland Community Benefit Fund Ltd (“SCBFL”). Heads of Terms have been agreed between VWEF and SCBL whereby £5000 per annum (adjusted for CPI) for each megawatt (“MW”) of installed capacity (£1.8m per annum if 103 3.6MW turbines become operative) will be paid to SCBL for payment into the Fund. The Fund will consider applications for aid from community, charitable, not-for profit groups working for the benefit of residents of Shetland but each year 10% of monies received will be distributed, by the Fund, among Shetland’s 18 Community Councils with a weighting of 5:1 in favour of the four areas containing turbines. Other benefits include (a) the accrual of capital value on SCT’s 45% share of VEWF, (b) rental payments to landowners and 200 crofting families, (c) the production of 1.5 billion units of electricity annually, offsetting hundreds of thousands of tonnes of CO2 emissions, (d) the advantage of the HMP already referred to and (e) employment during construction of the wind farm and in its subsequent operation. The development would also widen the narrow base of Shetland’s economy beyond fishing and oil and gas (the lifetime of the latter being finite in any event). It also had strategic advantage to Shetland in that it (and only it) would justify the provision of the “interconnector” cable needed to export electricity to the UK National Grid, from which many other renewable energy projects in Shetland could also benefit. This cable was to have a capacity of 600MW, which would leave “headroom” for the export of electricity from smaller windfarms in Shetland, the local network being already “saturated”. Eventual connections to Norway and to offshore installations were also being contemplated.

[16] Mr Priest explained the Contracts for Difference (“CfD”) process, success in which was essential to the scheme. This is a periodic “auction”, the next round of which is expected to open for bids later this year, with a decision perhaps in March 2019. Bidders submit a reference price and, if successful, should the base price of electricity fall below that price it would be topped up by a Low Carbon Contracts Company set up by the government and managed by the National Grid, giving the successful bidder a definite, index-linked, minimum income for a period of 15 years. The UK government had made it clear in a consultation paper published in January of last year (production 45) that wind projects on remote Scottish islands (“Remote Islands Wind” or “RIW”, as these have become known) that directly benefited local communities would be eligible to bid in this auction round.

[17] In cross-examination by Mr Mackenzie questions were asked about something called the “Busta House Agreement” of which, said the witness, there were two, the terms of which were confidential since they were private commercial documents between Shetland Islands Council and SSE. Although not disclosed to the wider public, these agreements had been scrutinised by a number of community representatives and councillors. Mr Mackenzie explored the possibility of smaller scale projects taking the place of this project but that was discounted by the witness. At the moment it was difficult to get even a domestic turbine connected to the local grid: only the interconnector to the UK mainland could “match the resource we’ve got here”.

[18] Mr Tait asked whether a referendum had been held on the project. The response was that holding a referendum was not within the power of the developer. To a suggestion, based on local community polls, that 70% of the population were opposed to the scheme, Mr Priest replied that most people who had expressed a view to him had said “Keep your head down and get on with it; this needs to be dealt with”.

[19] Mrs Moncrieff raised the possibility that the wind farm might last only 15 years but Mr Priest’s expectation was that it would run for its full intended 25 year course. She elicited that SCT had a budget of £10m to cover its share of initial costs and taking the project through the CfD process. In response to the suggestion that this would be wasted expenditure if Viking were not successful in the CfD auction, the witness referred to the possibility of bidding in further auction rounds. He was clear that the viability of the project was not dependent on any other renewable energy schemes going ahead: Viking’s capacity on its own would justify the interconnector, which would be paid for by Scottish Hydro Electric Transmission plc. The project would not go ahead unless it survived scrutiny at various levels, including Ofgem (the electricity regulator) and commercial banks.

[20] Mr Kirkwood gave evidence of the financial benefit to crofters from the scheme. His report dated 24 March 2016 is production 4D1 and production 49 is an update dated 13 June 2018. He explained his methodology and his reports contain worked examples of the compensation payable to crofters. The following summary does not do justice to what seems to us to be an impressive piece of work, albeit it was not the subject of rigorous examination in the course of the evidence, but there is no need for a fuller account because none of his conclusions on the level and adequacy of the compensation payable were challenged by the objectors.

[21] As a starting point, he was satisfied that the leases between the various landowners and the developers had been entered into at arm’s length and that the rent payable represented “a fair function of the development value of the land”. These rents were to be split 50-50 between the landowners and the crofting interest, which seemed fair and certainly well beyond what the crofters would get had the development proceeded by way of resumption under secs 20 and 21 of the 1993 Act, which would be a capitalised, one-off, payment rather than a continuous income stream throughout the lifetime of the project. His report had been peer reviewed by the Valuation Office, who had confirmed that the apportionment of the rent among the crofters was fair and reasonable (production 12).

[22] Mr Kirkwood, who has a degree in Ecological Science as well as being a Chartered Surveyor, also spoke to the likely effect of the HMP on the grazings. That effect was likely to be positive: the hill would be left in better condition at the end of the project, when the wind farm had been dismantled, than it was now. Mr Mackenzie put it to him that reinstatement of the hill would never take place because, although the turbines might be dismantled, the roads and concrete bases would remain. That was not Mr Kirkwood’s understanding (he thought the concrete bases, at least, were going to be excavated to a depth of one metre) but if the roads remained that might constitute betterment, in terms of crofters working the hill. He accepted from Mr Mackenzie that the area of proposed reinstatement of the hill was only 260 ha, which would be the most degraded land, not the land in the vicinity of Mr Cheyne’s or Mr Anderson’s homes.

[23] He had also considered the objections lodged and (although these objections are based on environmental and aesthetic, rather than financial, considerations) worked out what each objector would receive as financial recompense for the development. These calculations were confined to the base rate of rent (there is a variable rate as well, payable in certain conditions) which was guaranteed and not dependent on subsidy. If rent was paid at the more generous, though variable, rate, the payments to crofters would be greater. Payments based on the base rate would be fair; payments based on the variable rate would be generous. Asked by Mr Tait as to whether the compensation was fair to the cottars in the area (of whom, we were told, there are a significant number in the affected area), Mr Kirkwood said his instructions had been confined to the crofting interest and he thought what the crofters stood to get was fair.

[24] Questioned by the Court as to what the crofters (generally, not just the objectors) would be losing in terms of grazing rights, the answer was very little. Only 3-4% of the sward of the whole affected area would be lost to grazing and that would have no effect on soumings. Animals would be able to graze right up to the base of the turbines. There was, in reality, no loss of that kind. The only other loss would be loss of the opportunity to pursue crofter forestry within a certain radius of the turbines (so as not to interfere with the wind).

[25] As to any effect of the turbines on property values, Mr Kirkwood noted a report by the London School of Economics Research Centre, dated April 2014, entitled “Gone with the Wind: Valuing the Visual Impacts of Wind Turbines through House Prices” (production 26) carried out around 29 wind farms in fairly crowded geographical settings in England and Wales over a period of 12 years which suggests at 12% reduction in values within a 2 km radius. However, the report itself contained some “health warnings”.

[26] As against that, a report by climateXchange on “Impact of wind turbines on house prices in Scotland” published in October 2016 (production 27), which had analysed 500,000 property sales in Scotland between 1990 and 2014 had found no evidence of a consistent negative effect on house prices. Overall, it was Mr Kirkwood’s understanding, based on the foregoing and on information on the RICS website, that there was, as yet, no definitive answer to the question how wind farms affect property prices.

[27] Mr Kirkwood also attempted to derive support for the view that the turbines were unlikely to affect property prices from the fact that Mr & Mrs Nicholson (not represented at the hearing) had built two holiday homes and Mrs Moncrieff’s sons had built homes for themselves on the family croft despite the looming development. However, as was pointed out by Mrs Moncrieff, her sons did not have a lot of choice: land was more readily available to them on the family croft than it would be elsewhere and that is where they wanted to live.

[28] Mr Kirkwood had also arranged for the production of a photomontage (production 29B) with visualisations of the turbines from each of the objectors’ homes. It was somewhat scorned in cross-examination since it turned out to have been produced by SSE’s Geographic Information System and the feeling of the objectors was that it understated the degree of visual intrusion on the views from their properties.

[29] Although they did not give oral evidence, it is also necessary to say something of what is contained in the witness statements of David Robert Hegarty and Stuart Charles Dow, since these form evidence in terms of Rule 34(3) of our Rules.

[30] Mr Hegarty is the Civil Project Engineer for the Viking Energy development and his statement basically certifies, on the basis of their involvement with the construction of Strathy North, Gordonbush, Dunmaglass, Clyde Extension and Bhlaraidh wind farms, that SSE have the relevant competence and experience to carry out the proposed development in accordance with the planning conditions attached to the consent and describes something of what is involved in doing so, in the way of the preparation and ongoing updating of the Site Environmental Management Plan and other surveys and plans. It pays particular attention to peat management, an area in which SSE have, along with SNH, SEPA and local authorities, contributed to the preparation of best practice guidelines.

[31] Mr Dow is SSE’s Land Team Manager in their Generation Development department and, as such, has been responsible for securing the company’s land requirements for all their new electricity generation projections throughout the UK and has been involved in negotiating commercial terms for wind farm lease agreements since early 2009, since which time he has been involved with the Viking Wind project. His statement describes his involvement in extensive consultations with crofting interests as more fully set out in production 4x.

The objectors’ evidence

[32] Mrs Moncrieff, at the outset of her evidence, submitted three documents, an Opening Statement, a Case Outline and a calculation designed to put the size of the scheme in context. The following is taken from those statements.

[33] Four generations of her family had occupied the Southtown croft. She recalled a happy childhood growing up in the house which is now her daughter’s and enjoying the local environment, particularly trips out to the peats when they enjoyed spectacular views from the distant hills and revelled in the surrounding wildlife, both animals and birds. The Burn of Lunklet had always been a favourite place in her childhood, as it had become to her own family later. It was also a tourist attraction and many Shetlanders also visited it. The whole area was a place for work with sheep and at the peats but also a place of rest and recreation and should be preserved from all industrialisation. The scale of the wind farm construction would make such preservation impossible, would pollute the lochs and burns and would change crofters’ relationship with the land forever. Nothing could compensate for that loss.

[34] Her objections crystallised into three: (1) effect on the value of the croft and the family’s homes, (2) the adverse effect on the special environment of the Shetland mainland, and (3) lack of benefit to crofters and cottars. She also pointed to the uncertainty surrounding the viability of the project. These were numerous but included the possibility that additional wind farms would have to be built in Shetland to make the whole thing cost-effective, so that the final scale of development, already unprecedented, was not yet known. These uncertainties were relevant to the question whether the development was for a reasonable purpose. We should not set too low a standard for removing crofters’ rights.

[35] On the matter of the effect of the size of the development, the following quotation from Mrs Moncrieff’s Outline of Case summarises matters well:

“The main social and cultural aspects of the crofting way of life and the reasonable enjoyment of properties, which we value so much, will be adversely affected by the scale of the development proposed. I really disagree with the way that the Applicants’ submissions insist on analysing only the turbines on individual apportionments within the grazings, as if the total development is not of concern to crofters. This is distortive, and is not reflective of what it will be like to croft within a windfarm effectively. The vast scale of the industrialisation can only act as a disincentive for families and young people to continue and develop crofting as a meaningful way of life, and manage the land for the benefit of future generations.”

[36] The third of the documents tendered by Mrs Moncrieff was a calculation prepared by her son John, who later spoke to it in evidence.

[37] In questioning by the Court, Mrs Moncrieff confirmed that she was not claiming that there was anything peculiar or particular to her situation which made the development unfair to her as an individual. The development affected not only her but her sons and her daughter, who lived even nearer the site of the turbines, but no peculiar or particular unfairness was being claimed.

[38] In cross-examination, Mrs Moncrieff confirmed that she was a member of Sustainable Shetland and proud to be so and that she had always been opposed to the project. Asked whether she had taken advice on sec 19A and what was relevant under it and what was not, Mrs Moncrieff explained that what she was arguing was that the development was not for a fair and reasonable purpose. She accepted that the generation of electricity was one of the reasonable purposes listed in the1993 Act “but would not think a huge wind farm like this would be in the same category”.

[39] She accepted that it was improbable that tree-planting would take place in the affected area but it was a possibility; something the crofters would be entitled to pursue but for the wind farm. Reminded by Mr Mackenzie that tree-planting had been a considerable feature of the original HMP, she agreed that all of that had been discarded in the final version of the Plan.

[40] We allowed John Moncrieff, author of the document seeking to put the size of this development and its output into a Scottish mainland context to give evidence on that matter. The conclusion from this document is that to accommodate a development of proportionate size on mainland Scotland would require an installed capacity for the production of electricity 4 or 4.5 times greater than the present capacity. Mr Moncrieff agreed some modification of his figures in cross-examination by Miss Wilson but the matter is not sufficiently relevant to what we have to decide to go into that sort of detail.

[41] Having explained to Mr Mackenzie that, although we had allowed him to represent Mr Anderson and Mr Cheyne, he could not give evidence on their behalf, Mr Anderson spoke for both in the form of delivering a short written statement on oath. Like Mrs Moncrieff’s statements, it conveys well their strength of feelings:

“The scale of destruction this project would mean is enormous [this, and those below, Mr Anderson’s emphases]. East Burrafirth, where I live and also Mr Cheyne’s home in Aith, will be at the heart of it. The nearest turbine will be only 1.6 km from my house, with numerous turbines, anemometers and other infrastructure close by. This project will inevitably affect the water courses. This is one of the biggest catchment areas in Shetland. There are five lochs and numerous burns on these hills, including the widest burn in Shetland. There are stocks of wild brown trout, sea trout and eels which use the burn for spawning. The construction phase alone will completely change the environment and ecology no matter what these Viking Energy experts say. The hills behind East Burrafirth and Aith are blanketed in deep peat which will be severely disrupted … I am sure that to a businessman, sitting in an office on the mainland, this is a small matter, but to us it is our lives.”

[42] Mrs Tait, likewise, did not expect to have to give evidence but she did so, again in the form of a written statement spoken to on oath. Although a generation younger, like Mrs Moncrieff she spoke to a happy childhood growing up on the croft at Tumblin and enjoying the surrounding unspoilt environment. She and her husband have built a new home on the croft and their expectation had been that their children too would know this happy lifestyle lived in a pristine environment. This prospect was now under threat from the proposed industrial-scale turbines.

[43] They had concerns to do with health, excavation and property values. NHS Shetland had produced a report, “Health Impacts of Wind Turbines” in 2013, dealing with much smaller numbers and sizes of turbines, with much of the research dealing with climate conditions less severe than Shetland’s. The report had concluded that wind turbines were known to cause a number of effects that have an impact on health, including noise and shadow flicker that are sources of annoyance, sleep disturbance and symptoms of stress in some people.

[44] The concerns to do with excavation were that excavation of clay down to the rock base would produce fine particles of clay which were devastating to wildlife. On the likely decline of property values, she referred to the Gone with the Wind report, supra, and its conclusion of a 12% reduction in the value of properties within 2km of turbines.

[45] As to the compensation on offer, the fact that crofters would get compensation while non-crofting residents would not would certainly cause conflict within the community and how could one put a price on the destruction of harmony in a community? In any event, “Putting all of the above into consideration we feel very strongly that money can’t buy health or peaceful and tranquil scenery and wildlife”.

SUBMISSIONS

For the applicants

[46] The applicants’ submissions were presented by Mr McKay QC who helpfully provided a written copy.

[47] These submissions were structured so as to address, in turn, each of the matters on which we must be satisfied before granting consent to the scheme as these matters are set out in sec 19A(2). We need not set them out at length but note some points below.

(a) Reasonable purpose

[48] In relation to “reasonable purpose” Mr McKay addressed the submission made by Mrs Moncrieff that the uncertainties associated with the project – need for further detailed ground investigations and peat surveys, no guarantee that the project will gain a CfD, no guarantee that the project, if built, would be profitable - meant it could not be for a reasonable purpose. In his submission these were irrelevant simply because the generation of energy was a reasonable purpose in terms of sec 20(3)(a) of the 1993 Act. Its reasonableness, in the context of this application, was reinforced by the fact that the project would help achieve nationally important energy goals as confirmed by the Scottish Ministers’ letter granting sec 36 consent (production 20).

[49] As to the development not being for a reasonable purpose because of its scale and Mr John Moncrieff’s arithmetical calculation, it was highly relevant that in amending the definition of “reasonable purpose” in 2007 (Crofting Reform etc. Act 2007, sec 22(1)(c)) to include the generation of energy Parliament had not seen fit to impose any limitations on scale. Moreover we should bear in mind the UK government’s policy in favour of large scale commercial wind farm development on the remote islands whereby communities in these islands could benefit from hosting such projects.

(b) Unfairness

[50] There was no basis in the evidence for a finding of unfairness, as that is defined in subsec 3(b) of sec 19A. “Significant adverse consequences” to the objectors would have to be proved as compared with any adverse consequences for other members of the crofting community. Evidence as to general effects of wind farms was not enough; it had to be brought home to the effects of this wind farm on the individual objectors. There was no such evidence. Any significant adverse consequences had to be disproportionately greater for the objectors than for other members of the same crofting community. That hurdle was not even reached (because no significant adverse consequence had been proved), never mind cleared.

[51] As narrated above, at the outset of the hearing Miss Wilson indicated that she would not be taking objections to relevancy every time one arose. In submissions Mr McKay invited us to hold that the following objections were clearly irrelevant: sec 36 consent having been granted without a public inquiry, the failure to hold a referendum, divisions within the community (and not just the crofting community), impacts on wildlife, fisheries and landscapes as general environmental concerns, and the closer proximity to the proposed wind farm of the objectors when compared to the landowners who were facilitating the development.

[52] Having disposed of these grounds of objection, Mr McKay turned to the ones with potential to be relevant.

Visual impact

[53] Visual impact could only be unfair where it produced significant adverse consequences disproportionate to those experienced by other members of the crofting community in the affected area. There was no evidence of such disproportionality (in terms of effect on the crofters in or around Aith) here, as Mrs Moncrieff, to her credit, had confirmed.

Effect on tourism

[54] Mr McKay commended Mr Blackett’s impartiality, which had been the object of some scepticism from the objectors, and the conclusions of his reports. His conclusions were supported by the fact that Mr & Mrs Nicolson had gone ahead with building two holiday houses after the sec 36 consent had been granted. In any event these houses were on decrofted land so there was no crofting interest which would provide a competent basis for objection. In any event there was no evidential base for this objection.

Impacts on house prices

[55] Mr Kirkwood’s evidence was also commended to us as were the conclusions of the climateXchange report (production 27). Again this objection was without evidential support.

Health effects

[56] The objectors required to prove that the wind farm would have significant adverse consequences on the health of some members of the crofting community. They had not come anywhere close to doing so.

[57] For all of these reasons, unfairness had not been established.

(c) Fair recompense

[58] Mr McKay referred to the parameters drawn in the Coigeach case as to who was covered by the requirement for fair recompense. Although the effects of the development for which there was to be fair recompense may be of any kind whatsoever, in terms of sec 19A(3)(d), he submitted that the effect must in some way interfere with the objector’s rights or interests as a crofter. Here there was fair recompense in terms of the distribution scheme devised and spoken to by Mr Kirkwood. Although the area of crofting land potentially affected by the development was 8,575 ha, the area taken up by the physical footprint of the windfarm, including turbines and all infrastructure, was only 120 ha and crofters’ rights would continue to be exercised over the rest. What the crofters stood to lose was, therefore, minimal. With particular reference to the loss of the right to plant trees, counsel reminded us of the evidence doubting whether tree planting schemes would ever be realistic in Shetland, given the growing conditions.

(d) Financial benefit to the community

[59] On this matter the evidence of Mr Priest was relied on.

All of the statutory requirements of sec 19A(2) having been satisfied, we should grant consent under subsec (1).

For the respondents

Mr Mackenzie

[60] We heard from Mr Mackenzie on behalf of Mr Anderson and Mr Cheyne. He referred to subsecs (2) and (3)(c) and (d) of sec 19A. Consent was not to be given without fair recompense for the effects of the development, which could include an effect of any kind whatsoever, not limited to an effect on a croft qua croft. He would be grateful to the Court for guidance as to what the last part of that meant but, in his submission, it included effects on individual and community health and on non-crofting activities.

[61] Mr Anderson and Mr Cheyne were people “sewn into the fabric of the land”, their interests extending far beyond the financial to an intense concern for the environment, a concern they were convinced was shared by the majority of other crofters affected by the development. Now, extending the metaphor, this scheme of development threatened to tear up that fabric. That is why they were so concerned that they had felt obliged to come to court to object.

[62] In relation to health, it was not the case that health considerations had featured in the Scottish Ministers’ consent or, at any rate, the word “health” didn’t appear once in the document. No health impact assessment had been carried out by the applicants, although they had promised to do so. On the other hand, Dr Sarah Taylor (Director of Public Health for Shetland NHS and author of the Health Impacts of Wind Turbines study) had shown that wind farms generally did have an impact on health. The study had not been specific to the present proposal but what was proposed was a very big wind farm, so there was no reason to think that its effects on health would not be at least as harmful as around smaller ones.

[63] As to reasonable purpose, yes, generation of energy was a listed reasonable purpose but all other wind farms to date had been much smaller; nothing on this scale in a place the size of Shetland had ever been contemplated.

[64] As to impact on property values, Mr Blackett had not shown conclusively that the development would not have a negative effect on property values and tourism. We should have regard to the Gone with the Wind report and its identification of a 12% negative effect on property values in the vicinity of wind farms.

[65] Finally, Mr Mackenzie commented on the HMP, making the point that the original had been much wider in scope than the final one.

Mrs Tait

[66] Mrs Tait thanked us for taking the time to visit her home the previous day. It had allowed us to see the real beauty of Shetland.

[67] Coming to court had been a very anxious matter for her and her husband; the anxiety caused by the development was itself sufficient to endanger health, never mind the effects of the wind farm if built. Such evidence as there presently was suggested that the health of a considerable number of people had been adversely affected by the proximity of wind farms. Many effects, such as low sun and flicker, remained under-researched, so their full extent was unknown.

[68] The excavation of turbine bases etc. would devastate the hill irrecoverably. This was a matter of which her husband had some practical experience and it was a major concern.

[69] As to property values and fair recompense, this development would affect crofting and the crofting way of life of future generations. There was no precise science which could calculate appropriate recompense for all its effects, including effects on health. Financial compensation was not appropriate in any event. The most worthwhile elements of life could not be bought. The most important things to her and Mr Tait were family, children and future generations. They should grow up in a world in which a price was not put on everything.

[70] Shetland had many wind farms, but all of the others were proportionate to the landscape and geography, but not this one.

Mrs Moncrieff

[71] Mrs Moncrieff opened by saying that she had three main objections; (1) concerns about the peaceful enjoyment of the properties on the Southtown croft, (2) the likelihood that the special environment of mainland Shetland would be badly affected by the wind farm, and (3) that the crofters and cottars would not benefit from the large-scale industrialisation of the common grazings which was proposed. Her motivation in coming to the Land Court was to get the Court to look at the effect of the policies of Scottish Ministers on crofters’ rights and to find out if any unfairness was being caused to crofters or others. Section 19A allowed us to carry out a balancing act and each case must be decided on its merits. We should not read it too narrowly.

[72] The mere fact that the generation of energy was a named “reasonable purpose” in the legislation was not enough, otherwise any project claiming to be for energy generation would automatically qualify as being for a reasonable purpose, no matter how unrealistic. If the Scottish Parliament had intended that it would have said so.

[73] Nor did the planning process on its own give crofters sufficient protection. So the Land Court had to assess each project, on a case-by-case basis, against general standards of reasonableness and fairness. It was for the Court to decide what type and scale of development was right for the land in question and fair to the people affected. This one was far too big to be reasonable. It was a failure in sec 19A that it did not limit the size of wind farms that could be built on crofting land but we could still do it by holding that it was not reasonable and, therefore, that the development was not for a reasonable purpose.

[74] She referred to her son’s calculation which showed that Shetland was being burdened with an unreasonable share of Scotland’s renewable energy production. It was important in bringing home to us the disproportionate size of the development. It was unprecedented on crofting land. It was just “not fit for purpose” for Shetland. The loss of so much land from the pool of croft land would cause significant social and economic loss. Other communities would find it equally unacceptable in their areas.

[75] Mrs Moncrieff then reminded us of the uncertainties associated with the project. Detailed site investigation was yet to take place. Changes to the existing plan could occur as part of the government subsidy process. The fact that the interconnector, if built, would have “headroom” for production from other wind farms (seen as a good thing by the applicants) meant that the final scale and effect of wind farm development on Shetland was unknown. To grant consent to this development in the face of all these uncertainties would be to set too low a standard for the removal of crofters’ rights and would be regarded as a precedent in Shetland and beyond.

[76] It was wrong to say that nothing would be lost if the project did not go ahead: damage had already been done to the fabric of the community. The existence of planning restrictions, while extant, would continue to inhibit small, localised projects such as peat bog improvements and tree-planting; things which would enhance the visitor experience.

[77] Three generations of crofters lived on Southtown and she was concerned about the future of crofting for the younger ones. If the wind farm was built and ran for its intended 25 years, that was long enough to lose a generation of crofters. They would be lost because crofting would be less attractive in the vicinity of an industrial scale wind farm. Road building and quarrying and the laying of concrete bases would impair the environment for future generations. Crofting was not about money; there were non-economic benefits which would be lost if this development went ahead and there could be no economic compensation for loss of that kind.

[78] The development site was a truly beautiful and special area, close to the heart of visitors and locals alike and it saddened her that alternative community uses could not be explored while Viking had an interest in the area.

[79] Apart from thanking the court, which she kindly did, Mrs Moncrieff finished her submissions with a series of questions:

Was it reasonable to build an industrial size wind farm of this unprecedented scale on Shetland?

Was it reasonable to proceed without very detailed investigation of ground conditions?

Was it reasonable that so much of what was generated would not be required locally but would necessitate the laying of an interconnector cable with so much capacity that it would lead to further industrialisation of the landscape (in the form of more wind farms)?

Was it fair that the crofters (and, presumably, other residents) of Shetland bear a disproportionate burden in the provision of energy for mainland Scotland?

Was it fair that, whereas in some other parts of Scotland people were being encouraged to take up crofting, in Shetland the crofting community was being reduced?

Was it fair that future generations would be disincentivised from working the land for crofting and that options to pursue the crofting way of life be diminished?

DECISION

[80] We sustain Mr McKay’s objection to the relevancy of evidence relating to the failure to hold a public inquiry as part of the sec 36 proceedings, the failure to hold a referendum, divisions within the community, environmental impacts and the closer proximity of the objectors to the wind farm than the landowners. These matters are simply not relevant to what we have to decide. We have to decide this application within the four corners of sec 19A and the permitted grounds of objection in subsec (8) do not include these matters.

[81] Subsection (2) of sec 19A lays down a number of things as to which the Court must be satisfied before it can grant consent to a scheme of development lodged under subsec (1). They are the mirror images, so to speak, of the permitted grounds of objection set out in susbsec (8) and we shall deal with them in turn.

[82] The first is that the development is for a reasonable purpose. By virtue of subsec (3)(a) the definition of “reasonable purpose” contained in sec 20(3) of the Act applies. That definition takes the form of a list of examples and includes, at subsec (3)(viiia), the generation of energy. The objectors argued that although generation of energy was listed in that way, that provision did not contemplate a development of this scale. Energy generation from smaller wind farms would certainly be a reasonable purpose but not on this scale, which was out of all proportion to the size of the Shetland mainland.

[83] The difficulty with that is that the Act itself contains no such restriction and it would be very hard for the Court to draw a line as to what was a permissible scale of development in any case. That function or power is not conferred upon us by statute and is, in any event, much better suited to the planning process. This project has cleared the planning process, so we have to accept that the Scottish Ministers are content that it is not disproportionate from a planning point of view.

[84] It was also argued that the uncertainties surrounding the project bore on “reasonable purpose”. This probably stems from the Court’s approach in resumption cases of wanting to be reasonably sure that the proposed development will go ahead; see, for example, Lands Improvement Holdings Landmatch S.a.r.l. v Cole 2014 SLCR 85. The reason for that development (and it was an approach evolved by the Court itself, rather than something contained in the legislation) was the fear that resumption would be granted, and land actually removed from crofting, for projects which had no realistic prospect of success. As it was put in Secretary of State for Scotland v Shareholders of Lealt and Culnacnock Common Grazings 1982 SLT (Land Ct) 20 at p 30 “resumptions of croft land should not be lightly authorised for purposes which may soon fail and where other arrangements are available for fulfilling the desired purpose without permanently depleting the pool of croft land”.

[85] Section 19A does not oblige the Court to be satisfied that the scheme of development will go ahead. Moreover, in a sec 19A application, there is no risk of land being lost permanently to crofting: if the scheme does not go ahead, nothing on the ground will change. If the scheme goes ahead, the wind farm is built and the project then fails, that is a different matter but all that will be lost to crofting will be the footprint of the development unless and until the concrete bases etc. are removed. Unlike resumption, where land is lost to crofting once it is surrendered for the resumption purpose unless it is a temporary resumption under sec 20(1B) of the Act, land is not removed from crofting under sec 19A.

[86] Even if we had that power, however, we would not be persuaded on the evidence heard that the uncertainties surrounding the project are so great that consent should be withheld. We suppose the main uncertainty is the outcome of the CfD auction but this project has behind it the extensive experience and financial and technical credibility of a major energy company who must be as well placed as anyone to get it right in the bidding process. It is also clear that UK government policy has become supportive of the idea that Remote Island Wind should play a significant part in renewable energy generation provided there is a significant community benefit, as there is here.

[87] So far as other uncertainties are concerned, the lack of proper ground condition investigations has not prevented planning consent being granted. Such additional planning applications as may be required will, we were told by Dr Zisman, be for minor and incidental matters. So far as the interconnector, if built, stimulating further wind energy generation is Shetland is concerned, that can be good or bad, depending on the individual’s point of view but it has no bearing on the matters we have to decide.

[88] For all of these reasons we hold that the development for which consent is sought is one for a reasonable purpose.

[89] The second requirement of subsec (2) is that to carry out the scheme would not be unfair. Again subsec (3) comes into play to assist with the definition on “unfair”. It provides that carrying out the development is unfair only “where to do so would have significant adverse consequences for one or more of the members of the crofting community in the area affected by the development and either those consequences would be disproportionately greater than the adverse consequences for the other members of that community or there would be no adverse consequences for those other members”.

[90] The adverse consequences complained of here are environmental detriment, visual intrusion, risk to health and diminution of property values. The environmental consequences of the scheme are the same for everybody, although they may be perceived very differently by different people. The extent of any risk to health was not explored in evidence. The Health Impacts of Wind Turbines report was referred to in evidence and lodged but its author, Dr Sarah Taylor, was not called to give evidence and its conclusions are tentative and not specific to this development. We are not, therefore, able to use it to determine whether some people are at more risk than others and, if so, who these people are. Moreover the objectors themselves did not say they were more at risk than anyone else in the affected area.

[91] The complaint of negative effect on property values suffers from a similar lack of supporting evidence. Again a report – Gone with the Wind – was referred to and lodged but its author was not called, nor anyone else who could rebut Mr Kirkwood’s evidence that there is as yet no definitive determination as to whether there is an effect and, if so, what that effect is and where it arises. Moreover any effect is not confined to the objectors, so there is no unfairness in that sense. So this objection too is not made out.

[92] There is no suggestion of unfairness in the distribution of the crofting share of the rental income. The objectors’ position is, rather, that no amount of money could compensate them for the effects of this development on their environment and quality of life.

[93] Accordingly we are satisfied that to carry out the development would not be unfair.

[94] The third requirement of subsec (2) is that the scheme provides fair recompense to each member of the crofting community in the affected area for the effects of the development, including, in relation to the croft land, at least as much as the member would get on resumption.

[95] What effects require compensation here? The loss of grazings is one but (a) it is negligible and (b) it is very generously compensated. In truth the crofters are losing nothing except the land taken up by turbine bases, hard standings for construction purposes and the solum of the roads which require to be built. Their soumings remain unaffected and their animals can graze right up to the base of the turbines. The loss of opportunity to pursue crofter forestry schemes was mentioned but Mrs Moncrieff herself accepted that tree-planting in Shetland’s climatic conditions was improbable. In any event tree-planting will only be excluded within the “Buffer Zone” extending to 500 metres around turbines and 200 metres around other items of infrastructure, leaving plenty of land on which crofter forestry schemes could be pursued if deemed feasible. So there is no effect on crofting which is not adequately recompensed under this scheme.

[96] As to whether they would be recompensed more generously were the scheme to go ahead by way of resumption, the evidence of Mr Kirkwood was to the effect that they would not. Were the Court to be fixing a share in the development value of the land under sec 21 of the Act, it would likely be done as a capitalised lump sum and the multiplier would likely be a good deal less than 25. Here there is a prospect of an income stream running for 25 years (not guaranteed, certainly, but a prospect nevertheless) with the possibility that for some of that time the variable rent will apply, enhancing the return to crofters. Mr Kirkwood’s work takes account of the full range of interests; shares in the common grazings, soumings and the existence of apportionments. We are satisfied that his proposed scheme of distribution meets the requirements of subsec (2) so far as the effects of the development on croft land and crofting interests are concerned.

[97] Subsection (3)(d) provides that an effect for which there is to be fair recompense may be an effect of any kind whatsoever and, in particular, need not be an effect on a croft qua croft and Mr Mackenzie invited us to explain what sort of effect that might be. Although it is not necessary to do that in this case, since the respondents are not seeking recompense for any effect, out of deference to Mr Mackenzie we would say that it might include any non-crofting activities carried out by the crofter on the croft, such as, to take the most obvious example, the provision of tourist accommodation or other services, which was a feature of the Coigeach case. In the present case, by our order of 12 October 2016, we prevented Mr Anderson from arguing a case based on the perceived effects of the wind farm on his “Simmer Dim” boat charter business because it was run from Aith marina and was not croft-based. We considered that in relation to a business run off-croft, if we can put it like that, he was not in any different position from anyone else running a business and it was not obvious why he should have a claim for recompense whilst someone who was not a crofter did not. Subsection (3)(d) would cover any effect on any purposeful activity other than cultivation to which a croft might be put in terms of secs 5C(2)(a)(ii) and 31 of the 1993 Act but not activities which are not so permitted. More than that we do not wish to say in a case where the scope of subsec (3)(d) was not argued.

[98] The fourth requirement of subsec (2) is that were the development carried out (i) the crofting community would be likely to benefit financially and (ii) such benefit would be at least commensurate with any financial benefit which members might get on the development proceeding other than under sec 19A. On this the evidence of Mr Priest set out the financial benefits which would flow not only to the crofting community but to the whole community of Shetland with the creation of the Fund and disbursements therefrom. The 10% syphon which is to go annually to Shetland’s 18 community councils ensures that benefit reaches every part of Shetland and the 5:1 weighting in favour of the councils with turbines in their area ensures that the areas most directly affected will get more than the others. This seems to us to be a fair and sensible scheme of division and it was not suggested to us, nor can we imagine, that any other means of carrying out the development would result in a higher level of recompense.

[99] We are therefore satisfied on all of the matters on which subsec (2) requires us to be satisfied. Correspondingly, we are unable to sustain any of the grounds of objection contained in subsec (8). We have therefore granted the application.

EXPENSES

[100] Following our usual practice, we have allowed 21 days for written motions and submissions on expenses.

Postscript

[101] Finally, we wish to acknowledge the sincerity and passion with which the objectors hold their views and thank them for the civility and good grace with which they conducted themselves before us.