Andrew Forrest reveals plan for tax-free compensation to wind farm neighbours and hosts

Andrew ‘Twiggy’ Forrest has revealed a proposal to increase compensation to people neighbouring new wind farms. But it will cost the public purse hundreds of millions of dollars.

Exclusive: Taxpayers should subsidise compensation to people who host wind turbines or have to look at them, according to billionaire and green energy advocate Andrew Forrest.

Potentially the biggest impact of the proposal would be to increase compensation to people who live within about 10 kilometres of wind farms, which could lessen community opposition.

But it would likely cost the public purse hundreds of millions of dollars in lost tax.

There are 114 wind farms across Australia — including 21 in NSW, 41 in Victoria, 25 in SA and six each in Queensland and Tasmania.

These figures are likely to rise swiftly over the next five years, driven by the legislated target for 82 per cent renewable energy in the power grid by 2030, which is about double current output.

There are 15 under construction nationally right now.

Andrew Forrest says transparency and equity would be improved under his proposal. Picture: AFP

Payments to wind-farm hosts by developers are common and can be as much as $40,000 per turbine annually.

If that was tax-free, as Dr Forrest proposes, the amount could be lowered to $28,000, freeing up $12,000 for neighbours who, as things stand, may get little or nothing.

Were those neighbour payments tax-free, they would be equal to about $17,000 of gross income per turbine. Property owners who are closer to turbines would receive a greater share.

The effective total compensation being paid would increase by more than 40 per cent without pushing up developer costs.

But the lost tax revenue would be substantial when multiplied across the thousands of new turbines likely to be installed around Australia over coming decades.

There are more than 100 wind farms across Australia already.

Dr Forrest’s Squadron Energy typically does offer compensation to neighbours already, as do other big players such as Engie and TagEnergy, although there isn’t consistency from one developer or project to the next.

The offers can involve upfront and indexed ongoing payments, or electricity bill subsidies.

However, not all developers provide compensation to neighbours, exacerbating tensions with communities that fear they will only face downsides.

Dr Forrest argues that regulated payments would improve transparency and equity, as well as speed-up project delivery, helping the federal government to achieve renewables targets.

“We must ensure a fair share for not only host landowners, but also the communities surrounding renewables projects,” he said.

“There needs to be a national framework where the government standardises payments to both hosts and neighbours and makes them tax-free.”

Barnaby Joyce speaks with renewables protesters at Orange in NSW. Picture: Rohan Kelly

The idea has support from the Clean Energy Council, which represents more than 1000 renewables companies.

“Regional landholders reinvest these payments into their businesses and their local community, so making these payments tax-free is a win-win,” said the council policy officer Nathan Hart.

The offices of Climate Change and Energy Minister Chris Bowen and Treasurer Jim Chalmers declined to comment.

High-profile Opposition MP and outspoken critic of wind farms Barnaby Joyce said developers weren’t serious about paying proper compensation to affected property owners.

“I’m up for the debate, but when you are dealing with people whose greatest asset is an inspired virtue on their part and an invective of guilt towards you if you don’t agree with them, well that’s the trick of every pressure salesman,” Mr Joyce, who holds the northern NSW federal seat of New England for the Nationals.

“You have to look at the actual cost and damage and impairment to the asset that intermittent power causes,” he said.

“And people in towns who’ve come up from Sydney to places like Nundle, which is all about environment, their vistas have now lost value.

“They need to be compensated too,” Mr Joyce added.

“If you want to have that conversation let’s have it,” Mr Joyce said.