Issue details

22/00099 - Kings Hill Solar Park: Additional funding requirement

Proposed Decision:


Deployment of £878,000 additional funding to cover the increase in costs including risk contingencies to complete the Kings Hill Solar Park project.


Reason for Decision:


The original agreed funding of £4,167,000 is not sufficient to deliver the project due to delays from the land purchase, ecology finds, additional surveys, UKPN uplifted costs and additional contingencies





Kent County Council has used some time limited grant funding from Salix towards the delivery of a number of low carbon energy projects including two solar parks (see decision 21/00034). Key Decision 21/00109 approved £4,167,000 capital to deliver a 2.98MW solar park in Kings Hill The project is at RIBA Stage 5 (construction) and actual project costs are currently anticipated to be no more than £5,044,617.


The scheme is seeking to offset over 633 tonnes of carbon a year from KCC’s energy requirement and will contribute significantly to the de-carbonisation of KCC’s energy supplies Construction started in March 2022 and will be completed by or before 30 June 2023.


Revenue income from the project will increase once completed based on current market rates and a longer lifespan of the asset. Based on the original business case the cost offset from the Solar Park was anticipated to be upwards of £90k in year 1 (part year effect) and £140k/annum (on average). The updated position based on the increased capital costs, revenue and projected lifespan now anticipates these figures to be c.£360k in the first full year and an annual equivalent of £330k/annum over the 40-year lifespan of the project.




Do nothing –stop works and do not complete the project due to the cost increases. There is the risk/likelihood that KCC would have to hand back the full PSDS grant, will incur abortive costs that will exacerbate the in-year 2022/23 revenue monitoring overspend position as well has have to adjust the Medium-Term Financial Plan (MTFP) and remove the planned surplus/rebate of £140,000 per year from future budgets. (REJECTED)

Seek alternative funding – potential to stop works and seek alternative funding solutions, applying for further funding where possible. There is a risk that KCC might have to hand back the full PSDS grant funding used on the project if it is not completed. KCC would also incur significant abortive costs on the project to date and not benefit from the income the project would generate in the future if works were not completed which is already built into the 2022/23 and 2023/24 KCC budgets. (REJECTED)

KCC fund the shortfall complete the project, retain the full PSDS allocated grant, including the element via switch funding, and fund the additional capital cost with Net Zero Reserve funds. (PREFERRED OPTION) 

KCC fund the shortfall (Borrowing) – complete the project, retain the allocated grant, and fund the offset with KCC capital borrowing. Currently KCC is very close to its key performance indicator of borrowing costs at less than 10% of revenue budget, plus KCC’s capital strategy is to prioritise borrowing towards statutory projects/rolling programmes such as basic need, highways, and the corporate estate. (REJECTED)

How the proposed decision meets the priority actions of Framing Kent’s Future: Kent County Council’s Strategic Plan 2022-2026

Decision meets the following priority actions within Framing Kent’s Future


-       Support Kent to become a leading county for carbon zero energy production and use

-       Make use of low-grade land (e.g., landfill, low grade agricultural through use of solar and wind farms)

-       Work towards Kent being Net Zero by 2050

-       Use our commissioning and procurement power to support Net Zero and the green economy, reduce our carbon miles and prioritise buying local goods and services wherever possible, and to further support green economy jobs in Kent

-       Support strategic opportunities for growth through the delivery of sites and premises and support for new investment and business expansion where it will deliver higher value jobs and increased productivity and contributes to our net-zero target.



Financial Implications:


-           Purchase of land has been completed;

-           Project costs have increased and are now anticipated to cost no more than £5,044,617 including client costs, increased contingency, and cost of land;

-           The funding gap of £878,000 is proposed to be funded via the Net Zero Reserve.

-           Given that the council is projecting a significant overspend in the current year, the funding options and approach to complete the project may change to ensure minimal impact on the Council’s financial position.

-           The project assumes that the PSDS switch funding of £1,294,127 is coming back into the project via the Commercial Services Kent Ltd (CSKL) dividend.

-           Further discussions are underway with CSKL around alternative funding options that maybe more beneficial for the Council to pursue.

-           The projected cost offset from the solar park has increased from an average of £140k to £330k per annum, inclusive of these additional capital costs.

-           The increased saving on energy costs set against the increased contingency means that the overall financial benefit from the Kings Hill Solar Park to the council has improved.



Legal Implications:


-           The terms and conditions of the Salix grant funding mean that the energy produced by the solar park must directly benefit KCC through lower carbon outputs and these must be reported back to Salix over the coming years.

-           KCC has entered into contract with Kier for the construction of the development;

-           KCC will enter into contract(s) with private and or Latco companies for the running of the solar park including both operations and management and the sale and purchase of electricity.

-           A decision on access route for utilities.  


Decision type: Key

Reason Key: Expenditure or savings of more than £1m;

Decision status: Recommendations Approved

Division affected: Malling Rural East;

Notice of proposed decision first published: 04/11/2022

Anticipated restriction: Part exempt  - View reasons

Decision due: Not before 3rd Dec 2022 by Cabinet Member for Environment

Lead member: Cabinet Member for Environment

Lead director: Matthew Smyth

Department: Growth, Environment & Transport

Contact: Jonathan White, Southborough Project Manager Email: or 07988 375 334 Email: Tel: 01622 696904.


The proposed decision will be considered by the Environment and Transport Cabinet Committee on 8th  November 2022.

Financial implications: See above

Legal implications: See above

Equalities implications: Equalities implications: An EqIA screening has been undertaken and no impacts were identified as the site is a static power generation project. Data Protection implications: None required.