Agenda item

To receive the report of the Director - Regeneration and Environment providing additional details in support of the approvals being sought relating to the mobilisation and operation of Lee Valley Heat Network (LVHN).

(Report No.16)

(Key Decision – Reference Number 4080)

Please note Report No.11 on the Part 1 agenda also refers.

Members are asked to note:

·                The attached report is due to be considered by Cabinet on 17^th June 2015.  Subject to Cabinet approval of the report, Council will be asked to note the additional information provided in support of the approval being sought for the addition of the project development costs within the Capital Programme.

·                The decision made by Cabinet on 17^th June 2015 will be reported to Council as part of the amendment sheet tabled at the meeting.

(This document contains exempt information as defined in Paragraph 3 (information relating to the financial or business affairs of any particular person – including the authority holding that information) of Schedule 12A to the Local Government Act 1972, as amended)

Councillor Sitkin moved and Councillor Savva seconded the report of the Director of Regeneration and Environment (No.16) relating to mobilisation and operation of the Lee Valley Heat Network (LVHN).

NOTED

1.      The report had been submitted for consideration in conjunction with Report 11 on the Part 1 Agenda. (Min.46 refers) following its approval by Cabinet on 17^th June 2015.  Whilst the majority of background information had been included within the accompanying Part 1 report, members agreed that consideration should remain within Part 2 of the agenda, given the intended focus of the debate around the financial issues outlined within the supporting information contained in the Part 2 report.

2.      Cabinet had agreed the recommendations in the Part 1 report and noted the supporting financial information within the Part 2 report which had resulted in recommendation of the additional costs identified for inclusion within the Capital Programme.

3.      The progress made to date on delivery of a major infrastructure project within the borough as detailed within section 3.6 of the accompanying Part 1 report, which had included:

a.      the commencement of three key procurement exercises relating to the design, build and operation of the strategic heat network to Meridian Water; operation and maintenance of three satellite schemes at Ladderswood, Alma Road and New Avenue; and provision of a customer service for the entire network;

b.      nurturing of investor confidence and support  for the Business Plan; and

c.       recruitment of a strong project team involving expert technical and consultancy support from across the decentralised energy sector;

4.      The next steps planned in delivery of the project, as detailed in section 3.6 – 3.10 of the Part 1 report and breakdown of the additional funding being recommended for approval, which would be drawn down from funds already identified within the Council’s indicative Capital Programme.

5.      The concerns highlighted by the Opposition Group in relation to:

a.      what they felt to be the significant financial risks associated with delivery of the scheme and its potential impact on the delivery and viability of the Meridian Water development; and

b.      what was felt to be the limited opportunities available for wider member  oversight and scrutiny in relation to operation of the Holdco and management of risks as the project developed;

6.      In response to 5. above, the Cabinet Member for Economic Development and Business Regeneration highlighted what were felt to be the robust risk management procedures already established in order to monitor and mitigate, as far as possible, the risks identified.

Following a short debate the recommended inclusion of the additional funding within the Capital Programme was then put to the vote and agreed as follows:

AGREED to approve, as recommended by Cabinet, the inclusion of the £2.143m project development costs, as detailed within the Part 2 report, on the Council’s approved Capital Programme.

(Exempt information as defined in Paragraph 3 (information relating to the financial or business affairs of any particular person (including the authority holding that information)) of Schedule 12A to the Local Government Act 1972 as amended).

For: 33

Against:17

Abstentions: 0

Councillors Oykener, Sitkin and Taylor declared non-pecuniary interests in this item.  They remained in the meeting and participated in the debate and decision on the report.