Issue - meetings

To consider the report of the Director of Resources and Housing that informs Members of the progress of the district heating project since the previous report to the Board and which seeks approval to construct Phase 3E of the network subject to securing funding from the Heat Networks Investment Project and other conditions being met.

(Please note that Appendix 1 to this report is designated as being exempt from publication under the provisions of Access to Information Procedure Rule 10.4(3))

Further to Minute No. 201, 17^th April 2019, the Director of Resources and Housing submitted a report which provided an update on the progress of the District Heating project and which sought approval to construct Phase 3E of the network, subject to securing funding from the Heat Networks Investment Project (HNIP) and also subject to other conditions, as detailed within the report being met.

Responding to a Member’s enquiries, assurances were provided that a final decision to invest in the network would only be taken once a suitable commercial agreement with Vastint had been reached, with an undertaking to first liaise with the Executive Member and Opposition Executive Members to ensure that sufficient guarantees were in place before formally progressing.

Members were also advised that the report had been submitted to this meeting to enable the Board’s agreement on the proposal to be sought, subject to the conditions detailed within the submitted report, so that the HNIP funding could be drawn down, which added to the commercial viability of the scheme.

Following consideration of Appendix 1 to the submitted report designated as being exempt from publication under the provisions of Access to Information Procedure Rule 10.4(3), which was considered in private at the conclusion of the public part of the meeting, it was

RESOLVED –

(a)  That the contents of the submitted report and it’s appendices, be noted;

(b)  That subject to HNIP funding being secured together with commercial agreement with Vastint, approval be given for the additional injection of £6.215m in order to deliver Phase 3E of the District Heating Network;

(c)  That authority to spend for the construction of Phase 3E of the District Heating Network extension of £6.215m, funded through £2.438m HNIP grant and supported by £3.777m of prudential borrowing, be approved; and as this is subject to the approval of the HNIP grant from the Department for Business, Energy and Industrial Strategy (BEIS), the necessary authority be delegated to the Director of Resources and Housing to enable the Director to negotiate an alternative package;

(d)  That the necessary authority be delegated to the Director of Resources and Housing to enable the Director to take the final decision to invest in the network, once a suitable commercial agreement with Vastint has been reached;

(e)  That agreement be given to award contracts to Vital Energi Utilities Limited and Ove Arup and Partners Ltd., as set out in sections 4.4.10 - 4.4.13 of the submitted report;

(f)  That agreement be given to: passport the full grant award to the Leeds District Heating PipeCo Limited SPV once received, with no mark up or deductions, loan the SPV £3.692m at the minimum state aid compliant rate and require the SPV to meet the terms of the HNIP grant agreement;

(g)  That support be given to the connection of the Discovery Centre to the District Heating Network at a cost of £85k.