Compensation measures

Content description: 

Compensation measures are benefits or mitigation measures which can help compensate for the direct or indirect impacts of the project. Compensation measures can be negotiated early on in the project, and can provide an opportunity to introduce a positive element to a grid project to the local stakeholders potentially raising acceptance.

In general, a differentiation can be made between two categories of Compensation measures:

  • Direct Compensation measures that genuinely compensate for losses to local people or to the natural environment. These are likely to be required in law or through planning conditions. This type of Compensation includes direct payments to the owners of the land where the pylons are installed. Payment for the land can be regarded as simply negotiated land transactions, while the Compensation payments for losses of Land owners (e.g. due to a restricted use of the land for agriculture or forestry) are typically negotiated separately.
  • Community or environmental benefit measures, which a project developer decides to offer voluntarily, in recognition that host communities should benefit (not just that they should be compensated for direct losses)

Regarding the second category, it is important to ensure that proposed measures actually benefit specific stakeholders affected by a project. More general measures run the risk of targeting the wrong stakeholders and may be unsuccessful at reaching those most affected. In addition, Compensation measures should not be understood as a means to buy the support of local affected stakeholders but to really compensate them for the impact caused by grid projects.

It should be kept in mind that Compensation measures of both kinds, and particularly financial measures, may be limited by specific national legislation, which should be considered before any measures are proposed.

Content examples: 
Usual patterns: 

Possible Compensation and local benefit measures can vary widely and are dependent to some extent on applicable national legislation with regards to a TSO’s right to compensate a community affected by a grid infrastructure project.

Besides the direct financial Compensation measures paid to Land owners, public authorities or to avoid and reduce environmental impact, local benefit measures can, for example, include:

  • Direct financial support to the affected local communities
  • Sponsorship of local events or activities   
  • Other voluntary environmental activities that help to limit the direct and indirect environmental impact of projects   
  • Education and employment opportunities and programs 
  • Sponsoring projects for increasing the touristic potential of a region, i.e. sponsoring art projects or projects for enhancing the recreational potential of an area affected by grid projects






Further project-specific questions: 
  • What relevant legislation is applicable in the country / region of the project? Which Compensation measures does legislation prohibit and which does it permit?

  • What are the community’s key needs which could potentially be supported by the TSO? (e.g. the need for community centre; need for internship opportunities for local young people; etc.)

  • Will the project impact the local environment in a way that could be compensated? (e.g. compensation for relocated houses; alternative habitats for affected animals; measures to reduce or avoid environmental impact for affected areas etc.)

  • How can the TSO ensure that the proposed measure is perceived as a fair repayment, rather than an attempt to buy the community’s support?

  • How can the TSO ensure that Compensation measures actually compensate the affected individuals?


Format best used to transmit content: 
Usual patterns: 

Presentations can allow TSOs to pave the ground for informed in-person discussions on Compensation measures with affected stakeholders.

Further project-specific questions: 
  • Which information on Compensation measures for a specific project can be put into a Presentation?

Usual patterns: 

Information on Compensation measures can be provided in a more targeted way only to affected stakeholders via printed or emailed information disseminated to the community. Concise formats, such as Fact sheets, brochures, newsletters or e-mails, can help provide key information on Compensation measures in a clear and straightforward way.

Further project-specific questions: 
  • Which information can be provided in a one-directional, informative way?

  • At which point should these formats be used? Before (in preparation for) an interactive format? After consultation, once everything is finalised?


Channel to be used to transmit content: 
Usual patterns: 

Relatively small meetings with targeted groups (e.g. Local elected officials, Environmental NGOs, etc.) can be useful for communicating and consulting on potential Compensation and local benefit measures while they are being developed, and for receiving feedback and suggestions before consulting with the broader public or communicating directly with the public on a final proposed measure.

Further project-specific questions: 
  • Which stakeholders could be consulted in a group and which should be consulted individually?

  • How many meetings are necessary to negotiate a finalised Compensation measure proposal?

Usual patterns: 

In-person and interactive channels that aim at a larger group of individuals can be useful to communicate about Compensation and local benefit measures within the broader affected community, both to consult with local citizens while deciding on a measure and to spread information about it and update on progress once the measure has been decided upon and is being implemented. Citizen consultation on a Compensation measure may be most effective once the measure is already quite developed and would deal with specific points or options, rather than broad concepts, while still leaving room for choice and input.

Further project-specific questions: 
  • How much of the Compensation measure is left open to discussion, modification or choice once its terms begin to be communicated to the public?

  • In the local setting, what is the most effective way to communicate to the local population about Compensation measures?

Usual patterns: 

Traditional media, Social media and online channels can be used to spread the word to the wider public about a proposed Compensation measure and thus to boost awareness of the positive aspects of a grid infrastructure project. These kinds of channels can reach not only the local community, but also a wider audience, potentially generating positive attention to the project and building trust. However, before using such a far-reaching communication channel, it is important to ensure that the proposed measure will indeed have the intended positive effects and that its follow-through is certain.

Further project-specific questions: 
  • Should the communication measure be spread to a wider audience?

  • Should the information be contained to a particular region (e.g. via regional radio, regional TV, outdoor advertising, etc.) or spread more generally via the internet?

  • If the measure is being spread to the broader public, should any particular groups be targeted?

  • Is there a risk of a negative reaction from the broader public?

Country-specific examples: 

Under recent German legislation governing grid development, municipalities have the right to receive up to EUR 40,000 for every kilometre of a grid line that cuts through their area. This amount is reimbursable for TSOs via grid fees paid for by power consumers. In addition, some TSOs engaged in specific, targeted local benefit measures. For example, the German TSO 50Hertz created five small lakes in the Siebendörfer Moor Landscape Protection Area. This aimed at the creation of new habitats that were initially disrupted due to an overhead line.

The Hungarian TSO Mavir has engaged in community-based local benefit measures, such as donations to schools and kindergartens.

The Spanish TSO also engages in direct payments to affected communities. These payments have been started in Spain after compulsive payments for licensing procedures for new projects have been abolished. The payments are considered sufficiently high as to receive an acceptance rate of 95% from local municipalities and 90% from Land owners.

The Belgian and the French TSO engaged in the restoration of wildlife corridors under overhead lines and created new habitats in Natura2000 sites. This project also aimed to demonstrate that active management for biodiversity can reduce the costs of securing and maintaining corridors.
In addition, the French TSO financed a full-time employee for three years (potentially renewable) who works exclusively on bird issues related to grid infrastructure.