Agenda and draft minutes

Please outline your role and its responsibilities

(1)          I have recently gained a new part to my role, and am now the Energy and Sustainability Manager at Southend-on-Sea Borough Council.  The Sustainability part was added in mid-November.

How difficult was it to set up what you have at Southend?

(2)          It was not too difficult, having taken only 8 months from the research stage to going live, but it took a lot of effort. We looked at the options for addressing energy bills for residents and looked at what other local authorities – for instance, in London, Nottingham and Bristol – were doing to address the same issue.

(3)          With OVO, we saw an opportunity to set up a community energy scheme, and a chance to partner with them without limiting our future options. Partnering with them also offered the opportunity to start work quickly and for no financial outlay – always a good thing!  We needed to understand the issues involved in partnering, and design our marketing.  There were costs - but no benefits - in making the new partnership a separate company, so we didn’t do that. Part of our procurement process was to research if any other local authorities were offering something similar.

(4)          Southend-on-Sea Borough Council has no purchase financial transaction with OVO; we never purchase anything from them, so the arrangement has no procurement risk to us, yet gives us an opportunity to earn money.  OVO sells energy direct to residents under the banner of Southend Energy.

(5)          It was difficult to take a proposal like this to Council just before election time in May, but it went through unchallenged, having previously been considered by the Cabinet and the Place Scrutiny Committee.  There was discussion of issues such as the fact that energy prices were falling at the time, the suitability of OVO as a partner and whether or not Southend Energy would prove to be the cheapest energy supplier for local people. Final approval was given by the Council in March but we could not go live until after the elections, so we had just two weeks to organise the launch before going live on 28 May.

(6)          It is important to understand how the energy market works for consumers. There are 6 - 8 energy companies selling energy below cost price at any one time, with which Southend Energy has to compete. The Competition and Markets Authority Report from summer 2015 (David Price has a copy) points out that only 1 in 10 domestic customers shops around for the best energy price and that 9 in10 people are being overcharged, at a national cost of £1billion per annum.  The efforts of regulator Ofgem have not been successful in addressing this, and the situation has not changed in the last 3 - 4 years. This just relates to the domestic energy market; the situation for small business users is worse. Generally, people can only benefit from shopping around if they do it every year.  ...  view the full minutes text for item 13.

(1)          The Chairman welcomed Matthew Morris who worked for Kent Downs AONB Unit as their wood fuel development manager.

(2)          Mr Morris explained that Kent Downs AONB was a part of KCC but is governed by its own advisory committee and is responsible for raising almost all of its income (mainly from EU funding sources).  He had been employed by Kent Downs AONB in 2011 to implement a European Interreg project, this was initially a two year project but two additional years had been added.  His current contract is due to expire at the end of March 2016.  These projects related to activity in the forestry sector and the enhanced production, and use of wood fuels and renewable heat technologies such as biomass boilers.  He also advised on other forms of energy and their use in protected landscapes such as the Kent Downs AONB. 

Q – What scope is there to increase the use of woodland for fuel?

(3)          Mr Morris replied that only half of woodland in Kent was managed therefore the rate that this could increase was significant. The AONB Unit has, with the Forestry Commission, estimated the maximum sustainable annual yield from woodland in Kent (approximately 144,000 m³ per annum).  In energy terms this is around 246,000 MWh – equivalent to around 25M litres of oil.  The main drivers of woodland management in Kent at the moment are fire wood and fencing.  Other drivers include sport, recreation and conservation.   Use of timber from Kent’s woodland is currently nowhere near as high as it had been historically when the mining and paper making industries were still present.  Therefore there was a lot of untapped potential.

Q – Is wood for fuel sourced Kent or outside of the area?

(4)          Mr Morris explained that he provided advice to owners of woodland on how to bring their woodlands into management.  He confirmed that wood chip was the most local of the biomass fuels (often less than 10miles from source to boiler).  However, KCC’s procurement processes do not always allow for local suppliers to be used.  Moreover, KCC has not done enough to take advantage of local woodfuel supplies by adopting suitable biomass boiler technologies.

Q – What about wood pellets?

(5)          Mr Morris confirmed that this was the most viable/refined wood fuel. There are several manufactures in the UK, two of which are close to Kent.  There are currently no large-scale pellet manufacturers in Kent (although this may change). Although it was possible to import wood pellets, he advocated the use of indigenous softwood for pellets, much of which comes from the Forestry Commission estate.

Q – Kent has a lot of woodland that is no longer managed, is there enough viability for organisations to manage woodland? Is there a big enough market for commercial operations?

(6)          Yes the energy content of wood fuels is high and it ca help displace the use of oil and lpg and heating fuels.  .  Wood fuel is valuable to heat users.  However  ...  view the full minutes text for item 14.

(1)           The Chairman welcomed Mr Joseph Grice who was the Energy Capital Projects Manager at London Borough of Islington.  Mr Grice gave Members a brief introduction and explained that his background was in engineering, his current role at Islington Council was to oversee capital projects developed by the wider Energy Services Team. 

(2)          Mr Grice explained that the Government’s Heat Network Delivery Unit (HNDU) had funding available for feasibility projects – London Borough of Islington had been successful in obtaining funding for the London Underground schemes in other areas. 

(3)          London Borough of Islington used a Combined Heat and Power (CHP) network which converted gas generating power and heat as a by-product.  The heat was recovered and used to heat council and private homes, leisure centres and private buildings, and the heat network was 75-80% efficient due to the heat recovery which would ordinarily be wasted.  The network was producing power which was sold back to the national grid for a profit.  The heat which was recovered was sold onto residents at a cheaper rate because it was subsidised through the money received from the national grid.  Islington had used the CHP network since 2012, it was considered a forward thinking authority and the focus of the project was on helping poorer residents.

Q. How could this system work in Kent?

(4)          Mr Grice explained that the system worked best in areas of high heat density, town centres for example.  Mr Grice offered to provide examples of other authorities doing similar schemes.  Where Industrial buildings were producing heat the waste heat could be harnessed and used productively circulating it to housing estates or hospitals for example. 

Q.  How was the scheme financially viable?

(5)          Mr Grice explained that Members had been guaranteed a minimum 10% reduction in the cost of the heating to residents.  The exact figures could be provided to Members if requested. 

(6)          Mr Grice was asked to discuss with Members the scheme using excess heat from the London Underground.  The underground system had an ambient temperature of 18-30degrees, this waste heat would be converted to useful heat in a heat pump and would be boosted and put back into the network.  IT was confirmed that any London Borough with an area above the London Underground could harness the heat as a power source.  There was an added benefit in the cooled water bring produced as a by-product of the power production, which was then used to help to cool the underground system, it was a reciprocal process. 

(7)          Members commented on the size differences between Kent and Islington, Kent having approx. 1.8million population and Islington 300,000. 

Q.  Had Islington investigated any other fuels to generate heat or was the Council satisfied with the current system?

(8)          Mr Grice explained that the Council would love to look at alternative heat generating systems such as biomass and biofuels, however space was difficult in central London, the CHP network was reliant on gas supply but the scheme had provided  ...  view the full minutes text for item 15.