Agenda item

To seek approval to procure and award contracts for the Council’s electricity supplies from April 2025 to March 2029.

The Committee RESOLVED:

1. To approve the adoption of Option 3b (wider pool) as the basis for tendering for new electricity supply contracts.

2. To authorises the Executive Director: Growth and Regeneration, in consultation with Chair of the Environment and Sustainability Policy Committee, to procure and award contracts to put in place the approved option within the maximum contract value and budget envelopes outlined in the report.

3. To authorise the Executive Director: Growth and Regeneration to invoke any subsequent extensions/variations specifically defined in the contract(s) being awarded, up to the maximum contract value and budget envelopes outlined in the report.

4. To note that further approval will be sought to enter into specific Power Purchase Agreements for the supply of locally-generated renewable energy bought by BCC from local generators. This will include new renewable energy generation being developed by Bristol City Leap as well as new and existing community energy systems.

The Committee considered a report (agenda item 7) which sought approval to procure and award contracts for the Council’s electricity supplies from April 2025 to March 2029.

The Chair commented that this was a key decision report, as the proposed decision involved spend of more than £500k and was likely to have a significant impact on 2 or more wards.

Summary of main points raised/noted in discussion of this item:

1. It was noted that:

a. The Council’s current electricity supply contracts would expire at the end of March 2025. New electricity supply contracts would be required from April 2025 to avoid expensive ‘deemed’ supply rates that would be incurred if the Council continued to use electricity beyond the end date of the current contracts.

b. The Council’s electricity supply arrangements had been subject to a number of extensions and short-term contracts since the energy crisis from late 2021. The intention now was to stabilise the Council’s contractual position and enter into longer-term supply arrangements.

c. Officers were recommending approval of Option 3b as set out in the report, i.e. a tender for a new sleeving arrangement based on a new 'split pool' model; the whole contract value for this option was £78m, including a Bristol City Council cost of £33m.

2. It was noted that under this proposal, the Council would seek to set up a much broader sleeving arrangement, adding generators not owned by the Council into the pool. This additional electricity would power the remainder of the Council’s buildings, traffic lights and lamp posts, and other public sector buildings in the city.  The Chair commented that future reports were likely to be brought to the Committee about how other generators in the community could be supported.

3. In response to questions, it was noted that whilst Option 3b would cost the Council an extra £1m in comparison with Option 3a, officers were recommending this option as it would allow additional non-Bristol City Council generation and additional non-Bristol City Council demand to be included in generation and supply 'baskets'. This option was seen as building the foundation for a wider expansion of zero-carbon generation in and aroundBristol; it would though be the most complex option to tender and contract for, and would rely on securing additional demand to build a pool large enough to attract bidders.

4. It was noted that whilst Option 3b relied on securing additional demand and sufficient interest from bidders, it was also the most ambitious option.  Whilst this remained a risk, it was noted that officers had confidence in terms of attracting bidder interest; a pre-tender industry day was also being planned ahead of the formal procurement process.

5. It was noted that there was an error in the ‘financial implications’ section of the report where an inaccurate figure was included for Option 2 (the correct figure being £32m, not £30.493m).

6. An issue was raised about plans to replace the city’s gas powered cremators.  It was noted that options for the replacement of the cremators with electrically powered cremators were being considered, including discussions with City Leap.  It was also noted that this would be a matter for the Public Health and Communities Policy Committee to determine.

The Chair then moved the recommendations as set out in the report.

Cllr King seconded this motion.

Members generally indicated their support for the report recommendations, noting that the budget envelope for the proposal, from the Council’s perspective was up to £33m.  It was also agreed that it would be appropriate for a report to be brought back to the Committee in a year’s time evaluating the implementation of Option 3b.

The Committee RESOLVED (unanimously):

1. To approve the adoption of Option 3b (wider pool) as the basis for tendering for new electricity supply contracts.

2. To authorise the Executive Director: Growth and Regeneration, in consultation with Chair of the Environment and Sustainability Policy Committee, to procure and award contracts to put in place the approved option within the maximum contract value and budget envelopes outlined in the report.

3. To authorise the Executive Director: Growth and Regeneration to invoke any subsequent extensions/variations specifically defined in the contract(s) being awarded, up to the maximum contract value and budget envelopes outlined in the report.

4. To note that further approval will be sought to enter into specific Power Purchase Agreements for the supply of locally generated renewable energy bought by BCC from local generators. This will include new renewable energy generation being developed by Bristol City Leap as well as new and existing community energy systems.