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Decision details
Half-Hourly (large) electricity supply contract
Decision Maker: Executive Director: Growth and Regeneration
Decision status: Recommendations Approved
Is Key decision?: Yes
Is subject to call in?: No
Purpose:
The Council’s electricity supply
contract for large electricity consuming sites has reached its
scheduled end date (30th Sept 21). This coincides with historically
high energy prices. This contract would normally be renewed under a
competitive process, but there is a significant risk of locking the
Council in to high rates for an extended period if the contract is
renewed in the usual way. In common with most energy supply
contracts let by the Council, this contract has provision for
further extensions. In order to reduce the impact of current high
prices on the Council, the decision is being taken to extend the
current contract by a further three months beyond its original end
date, in order to allow time for the energy market to restabilise
before any new contract was let. This will still incur
significantly higher costs for the Council in the short term, but
will limit this impact to a few months. In the meantime, Council
Officers are developing an alternative procurement approach that
would reduce the Council’s exposure to energy market prices
in future contracts.
Decision:
Extension of the Council’s half-hourly
metered (large sites including City Hall) electricity supply
contract for three months.
Alternative options considered:
Option 1 - A standard contract renewal process
was started, but early indications were that bids were likely to be
considerably more expensive than the previous contract. The tender
process was stopped in favour of a short extension.
The Council contracts for electricity supplies through a licensed
supplier, who sources electricity from the grid. At the same time,
the Council generates significant amounts of zero-carbon
electricity from its own wind turbines and solar farm, which is
sold to the grid. Council Officers are developing proposals, under
approval granted at the February 2021 Cabinet, to link these up,
under a ‘sleeving’ arrangement, that will allow the
Council to supply its own buildings from its own generation and
from other local renewable energy generators. These arrangements
are not yet in place.
Option 2 -
Option 3 -
Publication date: 05/01/2022
Date of decision: 19/10/2021