A report from the Executive Director – Resources is attached. This should be read in conjunction with Report No.74, agenda part one refers. (Key decision – reference number 4642)
(This item 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)
(Report No.78)
Minutes:
Councillor Nesil Caliskan (Leader of the Council) introduced the report of the Executive Director – Resources (No.78).
NOTED
1. That Report No.74 also referred as detailed in Minute No.9 above.
2. The financial implications of the proposed investment decision as set out in detail in the report and the approvals required by full Council. The work which had been undertaken to date and the confirmation awaited regarding the external funding sources. The business plan had been refreshed and scrutinised as outlined in the report.
3. That approval was being sought for further investment to fund phase 2a of the Energetik business plan up to 2024. Further reports would be presented to future Cabinet meetings as and when required for consideration and approval.
4. Members were provided with an update on the existing programmes of work and those proposed in the future, as outlined in the report. All potential opportunities would continue to be explored covering both Council and private developments. The viability and costs involvement in further network expansions were outlined in detail. The long-term aims and aspirations of Energetik were discussed and, the issues to be taken into consideration in moving forward were noted.
5. The progress in the development of Meridian Water and the phased approach that was now being taken which reduced the potential risks, and increased flexibility.
6. Members acknowledged the issues which had been raised for discussion. The Business Plan had been scrutinised in detail and the external funding sources sought as required. The positive environmental impact that Energetik could continue to develop in the Borough was noted together with the aim of tackling fuel poverty.
7. That any impact from Brexit would be addressed as appropriate and necessary.
Alternative Options Considered: NOTED, the alternative options that had been considered as detailed in full in section 4 of the report.
DECISION: The Cabinet agreed to recommend to Council to
1. Approve a further investment of £30m, to fund phase 2a of Energetik business plan up to 2024 which was contingent on the Council securing HNIP and MEEF funding as set out in the table in paragraph 3.50 of the report. For the avoidance of doubt, the execution of the Heat Supply Agreement with the NLWA was a condition precedent on the Council releasing the approved funding being sought, as detailed in paragraph 3.4.4 of the report.
2. Should the Council not be able to demonstrate the need for HNIP gap funding by January 2020 as set out in the table at paragraph 3.50 of the report, the decision on an updated investment strategy would be brought back to Cabinet.
3. Approve the forecast £7.25m, allocation to be added to the Council’s “Projects in the Pipeline”. Addition to the approved programme would require relevant Council and Cabinet approval. Tranche 2b was the remaining investment required to deliver the full Energetik business case on the current assumptions and timelines.
4. Approve the revisions to the company’s 40-year Business Plan as outlined within the company’s Business Plan Addendum and the revised financial projections as identified within paragraphs 3.47 to 3.49 of the report.
5. Approve the delegation to the Executive Director – Resources (in consultation with the Director of Commercial) to agree and approve any items arising out of the due diligence exercise being conducted by KPMG, and from the legal and financial state aid advice.
6. Approve the Executive Director – Resources (in consultation with the Director of Commercial) to work with the company to agree and execute an on-lending agreement to cover Tranche 2 expenditure and to implement any arrangement involving equity by the Council. As per paragraph 3.33 of the report and the percentages set out in recommendation 2.6 of the report, above the blended rate, whichever was higher.
7. Subject to investment being secured from HNIP, approve in principle the ring-fencing of an amount of the received interest payments from Energetik, to be used on Enfield fuel poverty projects, to be reviewed annually, noting that a further paper would be required in due course detailing the intervention options available.
Reason: As detailed in Report No.74, Minute No.9 above referred.
(Key decision – reference number 4642)
Supporting documents: