Decision details

Award of Utility Contracts (Gas, Electricity, HH and NHH) to either suppliers under the ESPO or CCS Frameworks – AUG20/CMDN/25

Decision Maker: Cabinet Member for Finance

Decision status: Recommendations Approved

Is Key decision?: Yes

Is subject to call in?: No

Purpose:

With the approval of the Chairman of Growth, Environment and Resources Scrutiny Committee, special urgency procedures have been invoked to suspend the requirement to publish for a five day consideration period, and the waiver of call-in procedure has been invoked to suspend the option to call the decision in. These procedures have been invoked due to the need to notify the supplier of the Council’s intention to move to a green electricity tariff on the 1 October 2020, by 31 August 2020 (as requested by the new supplier (TG&P)). If the Council were to miss this deadline, it would remain on a brown electricity tariff, and would fail to achieve the targets previously committed to.

 

The Cabinet Member approved the new contractual arrangements for the Council’s supply of electricity and gas under the ESPO framework. This includes switching to a ‘green’ electricity tariff which is one of the Council’s declared 'top 20' actions for 2020/21.

 

Reasons for the decision:

Significant time had been spent by the Procurement team liaising with EDF and Corona prior to the end of March 2020, to obtain the necessary data to provide to ESPO due to there not being a centralised area that recorded data within PCC. It took until early March to provide ESPO with the correct information and they provided their pricing offer which was received on 12 March. PCC notified ESPO of the intention to move to their framework from 1 April 2020.

 

Some work has been done within Place and Economy to ascertain whether the data that pricing has been based on is accurate in order to ensure the Master Contract Schedules of the ESPO agreements which contain the financial terms agreed by ESPO with the supplier (Total Gas and Power) on behalf of the council are correct.  Due to exceptional circumstances following the procurement and detailed briefly in the Exempt Annex, this process is still ongoing, which is why the figures for which pre-approval is sought above are estimated and expressed as a maximum figure.  Notwithstanding this, the contracts are already running, and are currently running on the basis of the figures in the Master Contract Schedules (particularly Appendix A to Gas Contract and Schedule 2 to Electricity Contract as included in the Exempt Annex) which ESPO deemed provided.  Procurement officers are continuing to liaise with ESPO to finalize the correct figures.

 

In a motion passed at Full Council on the 24 July 2019 the council committed to: Achieve 100% clean energy across the Council’s full range of functions by 2030 (https://democracy.peterborough.gov.uk/documents/g4347/Decisions%2024th-Jul-2019%2018.00%20Council.pdf?T=2).

 

In addition, in the Council-CMAP adopted at Full Council on the 4 March 2020, the Council committed to: Reviewing its entire electricity and gas contracts, and, where practical to do so, will seek to amend to 100% renewable electricity tariffs and 100% carbon off-set gas tariffs as soon as possible (https://democracy.peterborough.gov.uk/documents/s41130/11a.%20Cabinet%20Appendix.pdf)

 

Alternative options considered:

The alternative option is to remain on the existing framework  which was with Crown Commercial Services (CCS) (the ESPO bid was assessed against indicative costings supplied by CCS). As they were unable to quote us fixed prices this was difficult to evaluate in full.  It should also be noted that the reason for serving notice on CCS was not due to pricing but was as a result of their failure in terms of performance of the contract, with CCS being slow to respond to requests for information.  The option of remaining with incumbent supplier was therefore discounted for the reason that they were not delivering best value for money in terms of overall service,

 

The option of running a fully independent procurement process for PCC Electricity/Gas in accordance with The Utilities Contract Regulation 2016 was not pursued due to time constraints. The timescale for completion of this process would have been 12-18 months. Furthermore a Framework will provide better value for money due to the economies of scale realised by being part of a basket for energy.

 

Interests and Nature of Interests Declared:

None

Background Documents:

None

Publication date: 28/08/2020

Date of decision: 28/08/2020

Accompanying Documents: