For a clean energy project to be sustainable, it must be technically, financially, and legally viable. And in order to be viable, projects must be appropriately structured to be legally compliant, manage risk, and be competitive. The legal aspects of a clean energy project are fundamentally about identifying, managing, and mitigating risk.

The law of clean energy is a relatively new and dynamic area of law. It operates in a legislative and regulatory environment that is constantly changing and evolving, with a more pronounced dynamism than in better established areas of the law. Many jurisdictions are at the initial stages in drafting law and policy related to clean energy, although some jurisdictions are considerably more advanced.

One of the quickest ways to compromise the financial viability of a clean energy project is to give insufficient attention to the legal structure of the project. Competent legal advice can be expensive. But if unanticipated legal costs (perhaps resulting from an inadequate legal strategy) start spiralling out of control, they can derail a project financially; an unforeseen legal morass can ruin a project and can expose the people behind the project to liability.

That being said, the high cost of developing comprehensive and customized legal and financial documentation remains a critical barrier to the implementation of clean energy projects. RETScreen's purpose is to reduce the transaction costs associated with developing clean energy projects, and this includes legal costs. This chapter will identify the main legal considerations in setting up a clean energy project and discuss some of the most common documents that such a project should have in place. Links to examples of these documents will also be provided in the hope that they can assist with developing a project's legal strategy, and ultimately reduce the legal costs associated with a clean energy project.