Agenda item

Members will consider a report on the progress of the Outline Business Case to create a Green Energy Park on the former landfill site at Harewood Whin.

The Chief Strategy Officer presented a report which provided an update to members on the outline business case to create a green energy park on the Harewood Whin site, noting the full business case would be funded by the net zero fund.  The Head of Carbon Reduction outlined the process and explained that it followed the HM Treasury green book protocols.

Members asked a range of questions covering the rationale for decreasing the megawatt capacity, the extension to the business case from 25 to 30 years, direct take off, the relocation of the council fleet to Harewood Whin, the smart export guarantee scheme, return on investment compared to other green investment projects, changes to the scheme, the cost of delivering one megawatt, project management risk mitigations, initial feedback on ground conditions, CYC energy manager, project phasing risks and optimism bias.

Officers reported the following:

·       One megawatt offered the least risk and the greatest return in the first phase; it was possible to expand on this in future phases.  Although the financial return would be lower, there was a greater environmental benefit. The cost to deliver one megawatt was around £1m.

·       Moving the entire council fleet to Harewood Whin would change routes and impact waste collection; Officers would seek to optimise routes.

·       The timescale for the project was based on the current lifecycle of solar PV, which was assumed to be thirty years.  The early years of the scheme would service debt repayment.  The full business case would examine this in more detail.

·       The smart export guarantee scheme (SEGS) was typically for a twelve-month period and then renewable.  A power purchase agreement was typically for between five and twenty-five years with a lower price point.  Should there be greater offtake on site, this could be actioned more quickly through SEGS.

·       There was a strong strategic case to make use of the site although the returns were slightly lower than similar schemes not on an industrial site. 

·       There had been no early indication of problems with the ground conditions survey.

·       The risks of project management would be mitigated through the use of internal contracts to ensure consistency for the lifetime of the project.  A project board exists in the Corporate Governance framework. Climate Change and national capital programme board.

·       An officer had taken on the responsibilities of energy management, additionally, a framework agreement was in place with Yorkshire Purchasing.

·       There were positive indications from the Combined Authority that the project would fit with their funding streams.  They provided strict deadlines which, if not met, would risk funding.

·       A phased approach meant that the scheme was not committed to existing technology.  The risks, both mitigated and unmitigated, would be clearly identified to the Executive.  The full business case would identify those gaps, such as the volatility of energy pricing. 

·       Each phase could be delivered as a stand-alone project, the strongest financial case was in the early stages of the project; the greater environmental and social benefits were within the later stages.  Phasing should reduce the risk although this would be further assessed in the full business case.

·       Optimism bias was included in the green book guidance which was was due to be reissued early 2026.

Resolved:            

i.                That member’s support for the scheme be noted.

ii.               To receive further updates through briefings and to return to the committee for pre-decision scrutiny.

iii.             A briefing for members on project management.

Reason:

To help shape the full business case work to follow.