A distinctive model for benefiting customary land owners
Genuine partnerships between landowners, community, Government and commercial entities are not just important for sustainable development; they are absolutely essential.
This has been the proven by the Tina River Hydropower Development Project (TRHDP) in Solomon Islands, where the flagship renewable energy project will provide more affordable, reliable and accessible power to its people and put Solomon Islands at the forefront of the new green global economy.
As well as these essential benefits, Tina has also paved the way with the development of an innovative and unique transactional model; allowing customary landowners to partner and benefit long term from the national project.
Understanding the dynamics – Solomon Island landowners
Solomon Islanders normally describe themselves as landowners, not landholders, and this is true: more than four-fifths of the land mass of the country remains customary in nature.
It is not subject to any central governing or formal administrative structure or process but is subject to the organic and complex workings of social, cultural and spiritual relationships that permeate it.
Customary land is the ultimate indigenous terrain – where non-tribal authority including the independent state of Solomon Islands, does not even have records.
The complexities of customary land is often one of the difficulties for large “development” projects to access such land and is the working reality when thinking about arrangements between landowners and would-be investors, including the government.
As uncovered during many years of deliberate and considered consultation during the Tina process, the Solomon Island landowners actual desire can best be expressed as the notion of “partnership”.
Instead of “putting up” one’s land for commercial finance, landowners often express a preference for partnership, in which they retain hold of their land while offering its use to a potential partner who would bring to the deal knowledge, capital and commercial nous.
Together, this partnership binds two parts of a package which contributes to a profitable and successful ongoing relationship. This “partnership” is the holy grail of the great majority of landowners, and the professed desire of many investors as well. Despite this, achieving it in practice has proven extremely difficult; until Tina.
The forming of a partnership – Tina Core Land Company (TCLC)
Based on years of consultation and lessons learnt through other in-country commercial arrangements with customary landowners, a different and innovative approach was required for Tina to be successful.
And a model needed to be created unlike anything previously used in this developing country. The result was the establishment of the Tina Core Land Company (TCLC); an entity set up with a 50/50 per cent partnership between the Solomon Islands Government (SIG) and the 5 traditional landowning tribes.
The TCLC was established in 2019 to hold the perpetual title of the acquired land, and administer the acquired land on behalf of SIG and the landowning tribes.
The TCLC was specifically structured to capture land compensation; an arrangement designed to fairly compensate the 5 Core land Tribes
whose land was acquired for hosting the Project’s infrastructures.
It is intended that the funds can be used to trigger commercial investments for the benefit of the tribes who also hold shares in the Tina
Core Land Company (TCLC).
The TCLC, being a functioning commercial entity, operates with an organisational structure that assumes responsibly to support the growth of the tribal cooperatives.
It also has a solid working relationship via a commercial contract with owner/operator Tina Hydro Limited (THL) through which a land lease agreement is in place.
The model will not only capture the lease payment but also an income stream from the eventual power sales for the Cooperatives. To get the best out of this innovative approach, stringent governance has been applied by a Board composing of 5 SIG representatives and 5 representatives from the Tribes elected by the people.
Importantly, the Board ensures the ongoing transactions, which occur from the the lease payment made by Tina Hydro Limited (THL) as the lessee in the Land lease agreement, are well invested for the benefit of the tribes.
Supporting this entity are also dedicated resources within the SIG Project Office who provide liaising roles for members of the 5 core land tribes who seek information relevant to the Co Op.
This robust model was developed in addition to the already established Community Benefit Sharing Project (CBSP) which is in place to gain the social license for the investor to be part of this cultural community.
The CBSP’s sole purpose is to administer benefits that will be captured from the revenue stream that will be generated once the hydro power system is operational.
The CBSP is not directly related to land compensation; it is a benefit that is due to the Project host communities despite them not having any of their land acquired for the project.
To ensure the above model is successful, it is important that both the Community Benefit Sharing Project and TCLC model work in parallel.
What Tina can teach others – a model to replicate
Tina River Hydropower Development Project has tackled the difficulty of customary land ownership by building a partnership as an absolutely fundamental foundation and in so doing has developed a model which acts:
– To register, title and commercially secure customary land without the original customary owners losing it.
– To create an equitable long term partnership between the government and indigenous landowners. This can be seen in the example where representatives from the 5 tribal groups are a part of the TCLC board and also make decisions with their Government counterparts.
– To host a multi-hundred million dollar plus infrastructure PPP investment (a hydropower dam, lake and power station) on the land held and governed within the framework of the said partnership.
– To provide a combined solution for the entire arrangement within a broader context of benefit sharing arrangements with the related tribes and communities who jointly host the project in their community, but whose land is not being used for the project.
The ongoing success of the TCLC will play a major role in helping the country fully realise gains and tangible public benefits from Tina. Years from now, long after the infrastructure has been built and the electricity is powering, generations of Tina catchment communities will still be benefiting thanks to this model.
Better still, the Solomon Islands is in a remarkable position to teach so much to its Pacific neighbours; having paved the way with a customary landowner model that works for infrastructure developments, investors, its people and country.