by 

Frédéric Schuller, Notary, ÉTUDE BENEDETTI, WI&NE Occitanie

English version translated by 

Nathalie Parent Dumoulin, Founder, NEXT EDITION, WI&NE Nouvelle-Aquitaine

As we drive through the beautiful countryside of France, we have become accustomed to seeing vast expanses of land covered in photovoltaic panels. However, more recently, we have started to see fields of elevated panels with crops or vineyards growing underneath them.

Agrivoltaic systems, also known as agrophotovoltaics, agrisolar, or dual-use solar panels, which consist of the combination of green energy production utilizing photovoltaic systems and agricultural production in the same area, have emerged as a promising solution to the constraints related to reducing cultivated areas due to solar panels used in agricultural production systems. 

Here are a host of parallel benefits for winegrowers. The elevated solar panels can retract on each other or pivot like louvers to expose the maximum surface area to the sun and let the desired amount of light and water pass through to the vines, allowing plantations proper development. Adapting cropping systems to climate change (protecting from or mitigating hazards such as hail) and remotely controlling the vineyard by providing real-time data (hydrometry, pluviometry, temperature, sunlight, monitoring water stress, etc.). 

But on this technical level, I shall gladly give way to the pioneer and global market leader in dynamic agrivoltaics, our partner and WI&NE comember, SUN’AGRI. Therefore, this article briefly explains the legal framework I recommend as a WI&NE expert for such an operation.

First, the notary will divide the space between the “surface rights” retained by the winegrower and the “air rights” leased (1) into two volumes. Second, he will set up a long-term lease for the operator of the photovoltaic panels (2).

1.Volume Division

Initially, the plot of land on which the agrivoltaic system is to be installed will be divided horizontally into two volumes.

Why is it necessary to establish this division? To clearly define the areas where the lessor and the lessee can fully and privately exercise their rights. This division is similar to how a plot of land can be divided vertically and then bounded by two new neighbors before the dividing wall is built, allowing each to own a distinct area.

This division will result in:

On the one hand, the surface, which, in addition to the soil stricto sensu, will include the subsurface and what will be above the soil up to a height of about four meters. This “surface” volume consists of the crop that will be grown on the plots—vines, of course, but also often pomegranates in our region or various other species.

Secondly, the “air” volume will include everything above the imaginary line at which the “surface” volume ends, i.e., from a height of four meters. Therefore, this volume is intended to include the photovoltaic panels installed by their operator above the crops grown in the “surface” volume.

To divide the property into volumes, a professional surveyor will create a descriptive statement outlining the exact starting and ending points of each volume in space, using plane and geodetic surveying. Of course, a notarial deed will be issued and published at the Land Registry Office, Cadastral Register, and Tax Office.

Then, the notary defines the parties ‘ relationship once the division into volumes is complete.

2.Long-Term Lease

A long-term lease is a contract whereby the lessor grants rights to the lessee of the agrivoltaic system, in return for which the latter pays a fee (sometimes referred to as a long-term ground lease or canon) and, through his activity, contributes to the benefits enjoyed by the lessor-operator of the crops grown on the ground. The lessee will produce and sell energy from the volume leased and the installations they have built.

However, the long lease has two significant and remarkable features. It is granted for an extended period, at least 18 years, often 30 or 40 years in practice. The long-term nature of this contractual relationship is a guarantee of stability for both the lessee, who carries out major installations and has to depreciate them over time, and the lessor, who not only knows he will benefit from additional income over the long term but will also develop new forms and methods of cultivation and marketing to suit the situation.

The long-term lease gives the lessee real property rights for a considerable time. To put it simply, the operator of the central photovoltaic system will be treated as the owner throughout the lease term and have the liberty to establish mortgage rights, which are often necessary for financing the facilities. Additionally, the lease can be transferred to a new buyer who must comply with the original lease conditions. This type of lease agreement is commonly known as an emphyteusis or emphyteutic lease.

A reciprocal easement agreement will govern the relationship between the two volumes.

At the end of a lease, there are different options available. One can keep the lease going for an additional period under the same or modified terms or terminate it. In the latter case, the lessor can own the lessee’s photovoltaic installations and potentially lease them to a new operator. Alternatively, the lessor could request the outgoing lessee to dismantle the infrastructure.

Synopsis

The long-term lease will enable a landowner, particularly a winegrower, to participate in a green energy production project. He will benefit from an image currently valued on the markets while receiving rent for the area made available (which, given the height, would be unproductive for his farm) and receiving cultural benefits regarding vine management.

For the operator, finding an available sunny surface area at a much lower cost than in an acquisition (especially as registration fees are minimal for the operation) while benefiting from solidly established prerogatives.

The long-term legal relationship between two parties involves certain rights and obligations that may be subject to unforeseeable contingencies. Hence, drafting an indisputable, balanced, and precise notarial deed is crucial. A public official must preserve such a deed. The notary’s expertise in this area will ensure the agreement’s success.

After signing the deeds, all that’s left is for the sun to shine and the vines to grow.