Every housing development needs power, connectivity, and water services. Bringing new utilities into a development site can be easier than establishing what service media is already there: existing electricity apparatus, telecoms equipment, gas pipes, and water mains or sewers sitting on or under a site can cause costly and lengthy delays if not identified and dealt with early. While the various utilities share a common pattern - identify, establish rights, negotiate relocation, act early - each comes with its own legal framework and pitfalls.
Electricity
Securing power for a development site is becoming more challenging as the grid connection queue seems to grow ever longer.
When it comes to dealing with equipment already on site, overhead lines and substations are usually picked up on a site inspection, but underground cables need a proper utilities search, and the infrastructure will typically belong to the local distribution network operator, such as SP Distribution or Scottish Hydro Electric Power Distribution, with high-voltage transmission lines belonging to SP Transmission or Scottish Hydro Electric Transmission.
The starting point is working out what rights, if any, the power company has to keep its equipment where it is. Titles and property documentation should be checked for existing land rights such as wayleave agreements or deeds of servitude. However, because wayleaves are not normally registrable in the Land or Sasine Registers in Scotland, they are often lost over time and enquiries may need to be made with the Scottish Power or SSE wayleave registries. Where documentation does exist, it's worth checking whether it contains lift and shift provisions and who bears the relocation costs.
Power companies will usually agree to relocate or divert infrastructure to facilitate redevelopment, provided the developer pays. Understanding exactly what property and statutory rights they hold is essential because, if those rights are absent or limited, the power company may have to contribute to relocation costs.
Even with no paperwork at all, the equipment may still have statutory protection, and where the power company has no right to retain its equipment in place, it can rely on compulsory purchase powers to acquire that right creating a trade-off between the cost of moving the equipment and the cost of compensating the landowner for lost development value if it stays.
Telecoms
The Electronic Communications Code gives designated operators statutory powers to install and operate apparatus on land and buildings, and although Code rights are meant to be agreed, operators can apply to the Lands Tribunal to impose terms, with statutory protections making it very difficult to recover possession and remove equipment even after a contractual expiry date.
This makes due diligence critical. Masts and underground cabling should be identified through site visits and utilities searches early in the process. It should also be confirmed that the relevant operator is on Ofcom's register of operators with Code powers because if it isn't, the developer is in a much stronger position. Sellers or operators should be asked to produce evidence of Code rights, and if no agreement can be traced, a notice under paragraph 39 of the Code can require the operator to disclose its position, with the owner protected against enforcement costs if the operator fails to respond within three months.
Timing matters. Agreements that expired before the new Code took effect in December 2017 may have lost Code protection (unless running on tacit relocation, which keeps them alive), while agreements still in force when the new Code commenced may allow use of the old Code procedure to require alteration or removal, which carries shorter timescales but usually puts relocation costs on the developer.
Termination itself is tightly controlled. A minimum of 18 months' notice is required, and termination is only permitted on one of four grounds:
- substantial breach;
- persistent late payment;
- failure to meet the test for imposing Code rights; or
- the site provider's intention to redevelop.
Where termination isn't realistic in the short term, a contractual lift and shift provision may allow relocation, though such clauses are unenforceable if inconsistent with the Code's own termination and removal procedures. Developers negotiating new or renewed agreements should build in protection for the future: a redevelopment break clause permitting termination on 18 months' notice, plus a lift and shift provision.
Operators also have automatic rights to fly lines over property with no supporting apparatus, subject to minimum clearance distances, though there is a procedure for objecting where removal is needed for development. Overall, termination and removal procedures can take two to three years or longer, making early engagement essential.
Water mains and sewers
Water and sewerage infrastructure follows a different model again. Underground pipes, drains, culverts and sewers can be hard to locate, so a detailed utilities search and site investigation are recommended early in due diligence. Public water mains and sewers vest in Scottish Water, which has a statutory duty to provide and maintain them and to keep detailed asset records, with asset maps available from approved map providers at relatively low cost.
Not all infrastructure is public, though: some water pipes and drains may be privately owned, so title deeds and other documentation should be checked for servitudes, wayleaves, or similar rights. Scottish Water has statutory powers to install new mains and sewers after serving statutory notices on affected owners and occupiers and can authorise third parties to do the same. Evidence of compliance should be requested if this isn't clear.
On cost and process, the position is more prescriptive than for electricity or telecoms. Any diversion works must be agreed with Scottish Water in advance and are carried out at the developer's cost, though in limited cases Scottish Water may agree to a build-over or asset protection agreement leaving existing infrastructure in place if future access and maintenance are provided for.
Where a diversion needs to cross third-party land, developers can apply to Scottish Water for authorisation, but Scottish Water will expect the developer to consult and negotiate with affected owners and occupiers first. Care should be taken before initiating such discussions if a prescriptive servitude right and/or insurance is being relied on.
The common thread and the key differences
All utility types reward the same discipline: early identification through site inspection and utilities searches, a careful check of title and property documentation for existing rights, and early engagement with the relevant body because relocation negotiations take time. For electricity apparatus in particular, negotiations with power companies take time, so early contact is recommended to reach a resolution and avoid delay.
But the legal mechanics diverge sharply. Electricity relocation turns on property rights backed by the power companies' own compulsory purchase powers. Telecoms is governed by a detailed statutory Code with its own notice periods, termination grounds, and tribunal backstop, making removal the hardest of the three to achieve quickly. Water and sewers sit under Scottish Water's statutory regime, where diversions are generally straightforward to request but come at the developer's cost, with special arrangements needed only where third-party land or existing infrastructure retention is involved.
Utilities due diligence must be a workstream in its own right at the earliest stage of site assembly, since the single biggest risk across all categories is the same: leaving it too late.
Contributor
Partner
