Distribution Line Electricity Easements
What are Electric Distribution Lines?
There are certain types of power lines that carry power from a power source to varying substations. These large lines are usually supported by lattice-type towers and are known as power transmission and or electric transmission lines. There is also a network of smaller lines, seen commonly along roadways and in neighborhoods. These lines are called electricity distribution lines. They carry energy from a local substation to individual homes and businesses. These lines can be overhead lines or underground lines.
Can I receive compensation for allowing the power company to run distribution lines across my property?
If you are requesting electrical service for your own property, there is usually minimal or no compensation for the granting of an appropriate electricity easement. However, when a distribution line easement is requested by the power company, there may be an opportunity to negotiate compensation for the taking of the property. This is especially true if the distribution line is being used to connect to a large commercial or industrial client such as a new store across your property. The key is knowing whether the electricity from the line is being distributed to another landowner or to you.
How does the power company legally run distribution lines across my property?
In order to run the electricity lines along your property, the power company will want you to sign an electricity easement agreement or easement letter. During this process, the power company will need to acquire what is known as a "commercial easement in gross". In layman's terms, you will be asked to allow the power company some rights to use your property under certain conditions.
There are specific uses that will be listed in the easement agreement, which can vary greatly from one agreement to another. Power and other utility companies are experts in these electricity easement negotiations and will try to obtain as many rights as they can (some of which are unnecessary and should not be agreed to). It greatly behooves you to have a knowledgeable advocate in your corner to ensure your rights are not given away unduly or without just compensation.
How much can I expect to get paid for a distribution line easement?
Compensation for a distribution easement or electricity easement depends on several factors. The power company will not want to pay anything for a distribution easement and will start the negotiation offer with no payment or a nominal onetime payment. They may offer to pay for the damage that installing the distribution line causes to the property. The amount depends on the general location, the type of land involved, the width and length of the electricity easement, value of the adjacent lands, and the damages to the property, etc. The differences in compensation are similar to differences in property values; there are many different conditions that would increase or decrease compensation. Our review process can evaluate these factors and give you a better idea in our negotiations going forward.
In general, distribution line easements running through the middle of a property are more valuable than those running along a property line or inside building setbacks. Distribution line easements usually require less land width than transmission line easements, but occur more often. Electricity easement compensation generally involves a one-time payment – not monthly or yearly rent. Because the easement is perpetual, there are typically no renegotiations once the easement agreement is signed. That means that you have only one chance to reduce unnecessary terms of the easement agreement while maximizing easement compensation.
If you have been approached to sign an easement document or easement letter, please contact us and we can help. We will be happy to review the proposal and offer a free estimate of whether it is worth your time and money to retain us. Contact us for more details.