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Decision details
Schools 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 Schools 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 electricity
supply contract for Schools 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 has been 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