Agenda item

REPORT OF THE CLIMATE CHANGE AND SUSTAINABILITY PROJECT MANAGER

The purpose of the report is to provide an overview of the key lessons learned and project closure reasons for the Solar for Business pilot project.

RESOLVED: That the Overview and Scrutiny Committee considered and noted the findings of the Solar for Business Project Closure Report (Appendix A).

REASON FOR DECISION: To enable the Committee to scrutinise the reasons for closure of the project.

Audio recording – 2 hours 32 minutes 3 seconds

Councillor Amy Allen, as Executive Member for Environment, presented the report entitled ‘Solar for Business Project Closure Report’ and advised that:

·             The report provided an overview of the project closure and lessons learned from the Solar for Business pilot project.

·             Despite efforts, it had not been possible to put legal agreements in place with any businesses to deliver solar installations on commercial premises.

·             As detailed in paragraph 7 of the report, the scheme was modelled on a successful scheme operated by West Suffolk Council.

·             Paragraphs 7.7 and 7.9 outlined the targeted outreach to large businesses and commercial premises with high electricity use.

·             Interest was attracted from 22 businesses and 7 were shortlisted, however, some were removed due to short leases or lack of financial return for the Council.

·             3 businesses proceeded to negotiate, however, they withdrew due to reasons surrounding savings versus installation costs, the proposed lease and practical issues.

·             After their withdrawal, the decision was taken to discontinue the pilot project and prioritise other projects with key climate actions instead.

·             Paragraph 8 outlined delivery constraints of the scheme and lessons learned.

·             One lesson learned was that businesses were more willing to invest directly in solar technology due to the falling price of solar panels.

·             Feedback from the project was used to inform the Sustainable Communities Grant which was open to businesses and community groups.

The following Members asked questions:

·             Councillor Martin Prescott

·             Councillor Ralph Muncer

·             Councillor Jon Clayden

·             Councillor David Chalmers

·             Councillor Claire Winchester

·             Councillor Sadie Billing

In response to questions, the Climate Change & Sustainability Project Manager advised that:

·             Just over £8,000 of funding from the UK Shared Prosperity Fund had been spent on the project and the remaining funding had been reallocated to other projects since its closure.

·             Officer time on the project had mainly been his, but officers from the Legal, Policy & Strategy and Procurement had also spent time on the project.

·             The scheme entailed the Council undertaking solar installations on the roofs of business premises in return for a reduced rate on electricity produced by the solar panels through a long-term power purchase agreement.

·             Pricing and leases offered to businesses had been similar to those offered by West Suffolk Council and other authorities in the market.

·             Template leases developed during the project had the potential to be used with in the future.

·             Interest had not been expressed by any businesses that occupied council owned buildings, however, this could be revisited when tenancies were up for renewal.

·             Economies of Scale might have been achieved through the bulk buying of solar panels if multiple businesses had signed up, however, they would have been achieved primarily through the installation on larger roofs, where the price per kilowatt installed would have been less.

·             Great effort had been put into engagement with the Letchworth Garden City Heritage Foundation, Business Improvement Districts and business groups.

·             A business target list had been built for the scheme using business rate lists and through communication with their Estates Team.

·             Interest had been received from smaller businesses through the general release of the scheme, however, they were not deemed to be financially suitable for the scheme.

·             Feedback from businesses who declined the scheme indicated that businesses were more interested in purchasing the solar panels directly, or through funding from grant schemes and other sources, which had been a contributing factor to the work undertaken on the Sustainable Communities Grant.

·             Further work would undertaken to help businesses to reduce their emissions.

In response to questions, the Director – Environment advised that:

·             The project closure was due to the inability to reach arrangements with suitable businesses that would generate sufficient financial return, as well as contribute towards their climate change goals.

·             It was decided that officer time would be better spent on the delivery of other actions within the Sustainability Strategy, as they would have a greater impact.

·             The Council had no regrets in piloting the scheme as they had gained valuable insights and limited their financial exposure before making any commitments. 

·             Business engagement would be looked at going forward to deliver wider sustainability goals across the district.

·             The scheme had been managed in line with Council project management framework.

·             Officer time spent on the scheme had been funded through existing budgets and had not been recorded as the Council did not record officer time in this way for any projects.

In response to questions, Councillor Amy Allen advised that lack of effort from officers had not been the reason behind the closure of the project.

Councillor Martin Prescott noted that business communication networks such as the Royston Chamber of Commerce existed and could have been utilised in the outreach phase to businesses. He also highlighted that 5-year asset leases for solar panels with reasonable payback terms existed and therefore businesses would have found the 25-year lease offered unattractive.

Councillor Jon Clayden proposed and Councillor Sadie Billing seconded and, following a vote, it was:

RESOLVED: That the Overview and Scrutiny Committee considered and noted the findings of the Solar for Business Project Closure Report (Appendix A).

REASON FOR DECISION: To enable the Committee to scrutinise the reasons for closure of the project.