Leaders can maximize local rewards from renewable energy development

The potential for economic growth, job creation and additional tax revenue for rural communities continues to drive interest in renewable energy development across the country. But, as some decision makers are learning, there are other ways such projects can positively impact a community.

Rural leaders in Iowa, Minnesota and South Dakota, for example, have negotiated Community Benefit Agreements to receive additional funding, scholarships and local donations. The project-specific agreements are negotiated between community groups and developers.

“CBAs identify tangible community benefits a developer agrees to deliver to broaden the positive impact of renewable energy development while ensuring residents’ involvement and support of a given project,” said Mallory Tope, policy associate with the Center for Rural Affairs. “Benefits vary based on a community’s needs and desires but can include provisions for labor, allocation of resources to community funds, and direct donations to local emergency services and schools.”

“Empowering Rural Development through Community Benefit Agreements,” a new Center for Rural Affairs resource guide written by Tope, can help rural community leaders better understand the CBA process and how to approach negotiations to fully take advantage of clean energy development in their communities.

The guide outlines the various forms of CBAs and the type of benefits that can be negotiated, and it shares success stories from developments in Iowa, Minnesota and South Dakota.

While CBAs have been used since the late 1990s, Tope said the type of community benefits available have continuously evolved, and there is no standard approach to establishing an agreement.

“In researching this report, we learned that most developers don’t enter into legally binding Community Benefit Agreements but instead agree on good faith,” Tope said. “Local leaders should keep that in mind and work together to ensure all voices are heard during the negotiation process. I also encourage them to read the success stories in our report, look at surrounding communities and counties with CBAs, and use that information during negotiations with developers.”

To read and download a copy of “Empowering Rural Development through Community Benefit Agreements,” visit cfra.org/CommunityBenefitAgreements.