A report from the Director of Regeneration and Environment is attached. This seeks approval of the Lee Valley Heat Network Business Plan and Summary programme. (Report No.27, agenda part two also refers) (Key decision – reference number 3706)
Note: The appendices referred to in the report have been circulated and are available on the Council’s website as a separate reference pack.
(9.05 – 9.10 pm)
Councillor Alan Sitkin (Cabinet Member for Economic Development) introduced the report of the Director of Regeneration and Environment (No.25) setting out the progress and development of the Lee Valley Heat Network Business Plan noting the positive coverage on ITV London News on Monday 21 July.
1. That Report No.27 also referred as detailed in Minute No.22 below.
2. That Members’ attention was drawn to the executive summary and recommendations detailed in the report. Councillor Sitkin outlined the project to members and highlighted the Council’s major policy objectives that would be met including environmental and regeneration activities. The links to the Meridian Water development were highlighted. This was a complex project that would present opportunities and risks to the Council as set out in the report.
3. Councillor Taylor stated that this was one of the most important Cabinet decisions of the last four and a half years, with the opportunity to create a legacy that lasts for decades. It is a significant decision for the Cabinet as a major infrastructure project with huge potential for the Borough. It had the potential to protect and encourage the long-term viability of businesses within the Lee Valley.
4. Members welcomed the project and noted that the potential risks were outweighed by the benefits to the Borough. This was an innovative and complex project which would for the first time provide local communities and businesses with low carbon energy from local heat sources. The potential to create a significant number of new jobs for the Borough’s residents was also noted.
Alternative Options Considered: NOTED that alternative options which had been considered as detailed in section 4 of the report.
DECISION: The Cabinet agreed
1. To approve the Phase 1 Business Plan and Summary Programme for Tranche 1 (Ladderswood, Alma Road and New Avenue Satellite Schemes) and Tranche 2 (Meridian Water Phase, as the first stage of the strategic heat network).
2. To approve, for recommendation to Council an addition to the Capital Programme, capital funding of £1.285m to fund development costs through to financial close in September 2015.
2.1 The Summary Programme showed financial close in September 2015, in order to supply heat to the first phases of homes at Meridian Water.
2.2 £1.285m was the Council’s total “at risk” investment at this stage.
2.3 The Council had recently submitted an application for match-funding to the Department for Energy and Climate Change’s Heat Network Delivery Unit (HNDU), to recover as much as possible of these development costs. HNDU grant funding could meet up to 67% of the estimated eligible external costs of heat mapping, energy master planning, feasibility studies and detailed project development work such as technical design, financial modelling, exploration of commercial models and contracts. Local authorities were required to secure the remaining proportion of match funding which could not be provided “in-kind”, such as staff time, office space and catering. A funding decision was expected around August 2014.
3. To approve the estimated £85k revenue cost related ... view the full minutes text for item 14