When the Scottish Government introduced guidance in 2014 recommending that onshore wind farms provide £5,000 per megawatt per year in community benefit, it was presented as a fair baseline. The intention was to ensure that communities shared in the value of local renewable energy.

More than a decade on, that figure hasn't changed. In real terms, it has fallen significantly.

From the outset, the £5,000 figure was never intended to remain fixed.

Official guidance made clear that payments should be index linked to inflation, typically using the Consumer Prices Index. The reasoning was simple. Inflation increases costs over time, and without index linking, the value of payments reduces.

Government examples demonstrated that index linking could increase payments substantially over the lifetime of a project, in some cases rising from £5,000 to more than £8,000 per megawatt.

In other words, £5,000 was intended as a starting point, not a long term ceiling.

Despite this guidance, index linking has not been consistently applied.

Evidence from community reporting and industry analysis suggests that only around sixty per cent of funds are index linked. Many projects remain fixed at £5,000 per megawatt, and very few go beyond that level.

As a result, the value of community benefit has steadily declined.

Adjusted for inflation, £5,000 in 2014 is now equivalent to roughly £7,000 to £7,300 per megawatt per year in 2026.

This means that £5,000 today represents a loss of around thirty to thirty five per cent in real value. Even £6,000 remains around fifteen to twenty per cent below the original level when adjusted for inflation.

This is the key question. The issue is not simply a failure of policy, but how the system was designed and implemented.

It was guidance, not law

Community benefit payments are voluntary. They sit outside the formal planning system and must be negotiated directly with developers.

There is no legal requirement to provide them, and no mechanism to enforce index linking.

Developers retained discretion

Although guidance recommended index linking, it often allowed flexibility in how and when it should be applied.

In practice, this meant developers could choose to fix payments, delay index linking, or omit it entirely.

Early agreements set the precedent

Many wind farms approved during the 2010s agreed community benefit at a flat rate of £5,000 per megawatt.

These agreements were typically fixed for long periods and rarely included review clauses. Over time, they established £5,000 as the accepted norm.

Communities lacked access to information

Guidance acknowledges that communities often have limited access to comparable data and may not know what level of benefit is reasonable to expect.

As a result, early agreements may have been accepted without full awareness of the long term impact of not including index linking.

The result: a gradual loss of value

What has happened is not a sudden change, but a gradual erosion.

The headline figure has remained the same, while inflation has continued to increase costs year after year. The real value of payments has declined accordingly.

This creates a misleading picture. Payments appear stable, but their actual worth has reduced significantly.

Recent discussions about increasing the rate to £6,000 per megawatt are often presented as an improvement.

In reality, £6,000 does not restore the original value. It only partially addresses the gap.

For a typical 50 megawatt wind farm:

At £6,000, the community would receive £300,000 per year.
At a fully indexed rate of around £7,200, the figure would be £360,000 per year.

This leaves a difference of £60,000 each year, or £1.5 million over a 25 year period.

This is not simply a technical discussion about inflation.

If £5,000 per megawatt was considered a fair level of community benefit in 2014, then maintaining that fairness requires updating the figure to reflect current values.

That would mean setting a new baseline of around £7,000 or more per megawatt, alongside proper index linking in future.

Anything less continues the pattern of declining real value.

Community benefit was introduced to build trust between renewable energy developers and the communities that host them.

That trust depends on transparency and on maintaining the real value of commitments over time.

More than ten years on, the principle of index linking was clearly established. The issue is that it has not been consistently applied.