Issue - meetings

The Executive Member for Commercial and Community Assets.

RESOLVED – that the Executive:

(i)               Endorses the appointment of Shell Energy as the provider of gas and electricity supplies for Council properties from 1 October 2023 to 30 September 2025.

The Executive Member for Commercial and Community Assets, Councillor Andrew King, introduced the report on the Electricity Supply Contract 2023 to 2025. The Council’s contracts for gas and electricity were previously with multiple suppliers and had varying end dates during 2023 and 2025.

Since the war in Ukraine, the domestic and global energy supply market had made procurement of energy significantly more challenging. Volatile energy prices have resulted in suppliers requiring virtually immediate decisions in order to secure the best prices. These circumstances meant that it was not possible to seek approval of the recommended contract in advance, but it was now set out in the report to Executive for endorsement.

All bids offered significant savings on current electricity costs but Shell Energy’s bid for the 24-month contract was considered to be most advantageous, offering a saving of over 40%, equivalent to £342k per annum compared to current costs. These significant cost savings will reduce the call on Reserves that was anticipated when the 2023/24 budget was approved.

There were no questions from Executive Members.

Visiting Members asked the following questions:

·        Information requested on renewable gas – the report noted that the new contract offered 100% renewable energy. Officers confirmed that the contract predominantly relates to electricity supplies. The selected contractor will provide a breakdown of renewable energy. Further information would be provided in a written response.

·        Methane gas – Members asked why the Council was supporting a supplier who continues to maintain the current status quo regarding livestock which produces methane gas. Could the Council have selected a more ethical option? Also what steps are being taken to reduce gas consumption rather than focus on the cheapest supply option. Officers agreed to provide further information in a written response but it was confirmed that there are plans in place to reduce energy usage across the Council’s sites.

·        Solar panels and renewable energy – Members asked whether the contract was flexible enough to include renewable energy such as from photovoltaics. Officers confirmed that the contract supports the delivery of these alternatives where possible. For example, installation of photovoltaic panels was being considered for Horley Community Centre and Priory Park café. And there is provision in the Capital Programme for this type of investment.

·        Ringfencing savings – Members asked whether the savings from the new contract would be ringfenced to invest in renewable energy such as PV panels. Officers confirmed that a decision would be made later in the year as part of the service and financial planning on the allocation of available resources, including any efficiency savings identified.

The Leader, Councillor Biggs, thanked Dan Jones, Property Services Manager, for his work on the new contract and securing the 40% savings for the Council.

RESOLVED – that the Executive:

Endorses the appointment of Shell Energy as the provider of gas and electricity supplies for Council properties from 1 October 2023 to 30 September 2025.