Long-term community benefit sharing
Long-term community benefit sharing embeds a durable economic stake for the people and communities that host new energy infrastructure. Rather than relying primarily on one-off compensation for land access or project impacts, these models distribute benefits over the operating life of an asset through mechanisms such as recurring landholder payments, community funds, revenue sharing or local equity ownership. The approach can be established through government policy, procurement requirements or agreements between project developers, network operators and host communities.
Payments can be linked to the infrastructure hosted, while ownership models can allow communities to participate directly in project returns through trusts or other investment structures. By connecting local benefits to the long-term operation and performance of infrastructure, these models can create a more enduring alignment between project delivery and local economic interests. This matters as expanding transmission, renewable generation and other power infrastructure increasingly requires development in communities that may bear concentrated land-use, visual or construction impacts while the wider system receives the benefits. Well-designed benefit-sharing arrangements can make those local benefits more tangible and sustained, complementing engagement and compensation while supporting community acceptance and infrastructure deployment.
Main Outcomes of the Solution
- Socioeconomic Impact: Directs long-term economic value to communities and landholders hosting power infrastructure through recurring payments, community funds or participation in project ownership.
- Institutional Efficiency & Transparency: Establishes clearer and more predictable frameworks for determining, distributing and reporting benefits to host communities and landholders.
- Business Value: Better alignment of project and community interests can reduce stakeholder-related development risk and support the long-term deliverability of infrastructure investment.
Key implementation and scaling factors
- Define upfront which communities or landholders qualify, which infrastructure is covered and how benefits are calculated and distributed.
- Structure benefits over the asset life, rather than relying solely on one-off compensation, with payments or returns designed to provide meaningful and proportionate local value.
- Embed benefit sharing in licenses, procurement requirements, project agreements or ownership structures to support consistent delivery.
- Establish clear payment schedules, reporting requirements and dispute-resolution mechanisms to maintain trust over long project lifetimes.
- Use accessible and transparent ownership structures, such as community trusts, with appropriate governance and community participation to aggregate ownership and distribute project returns.
Case studies
NSW Government & EnergyCo (2024), Australia
New South Wales (NSW), Australia, introduced the Strategic Benefit Payments (SBP) Scheme to provide long-term financial benefits to eligible landholders hosting major transmission infrastructure. Under the scheme, network operators make payments to eligible landholders in addition to compensation for transmission easements. Eligible landholders receive the equivalent of A$200,000 (USD 143,000 as of Sep 2026) in 2022 dollars per kilometre of eligible transmission infrastructure hosted on their property, paid in annual instalments over 20 years and adjusted for inflation. Payments begin after the infrastructure is energized.
First announced in 2022, the scheme is now implemented through conditions on network operator licenses, with detailed guidelines effective from July 2025. This embeds long-term benefit sharing within the regulatory framework rather than relying solely on voluntary project-level arrangements. By extending payments over 20 years, the scheme provides an ongoing economic benefit to landholders hosting infrastructure required for power-system expansion.
Ørsted (2016-present), United Kingdom
Ørsted operates a portfolio of Community Benefit Funds linked to its offshore wind farms in the United Kingdom, providing long-term funding to coastal communities hosting or affected by associated infrastructure. Its East Coast Community Fund, established in 2016 alongside the Hornsea and Race Bank offshore wind projects, provides £465,000 annually for a 20 year period, including dedicated funding for skills development, and so far has awarded almost £4.5 million to over 328 community and environmental projects across Yorkshire, Lincolnshire and North Norfolk. Ørsted has subsequently extended the model to other projects, including the Hornsea 3 Community Fund, which will provide £7 million over a minimum ten-year period, split between community, skills and legacy funding. The funds are administered independently by GrantScape, with local advisory groups contributing to funding decisions. Across Ørsted's four UK Community Benefit Funds, more than £15 million has been awarded to over 1000 local projects, demonstrating how recurring project-linked funding can provide sustained benefits throughout renewable infrastructure development and operation.
Department of Electricity and Energy (2011-present), South Africa
South Africa's Renewable Energy Independent Power Producer Procurement Program (REIPPPP) integrates community participation into the competitive procurement of grid-connected renewable generation. Under the program, economic-development requirements complement the technical and commercial elements of procurement, including local community ownership of renewable energy projects. Community ownership has typically been structured through community trusts, allowing qualifying communities around projects to hold equity and participate in project returns.
In 2019, the government reported that projects procured at that stage represented R209.4 billion (USD 13.0 billion as of Sep 2026) in committed private-sector investment and projected that qualifying communities would receive R27.1 billion (USD 1.68 billion as of Sep 2026) in net dividend income from their shareholdings over the 20-year operating lives of those projects. The program has continued through subsequent procurement rounds. For projects reaching financial close in Bid Windows 1-6, the government reported in 2025 that black local communities held an average 8% ownership, compared with a 5% target average.
The programme demonstrates how long-term community participation can be embedded within large-scale competitive power procurement, linking renewable-energy investment with local economic participation through project ownership.
References:
