Decision details

Continuation of District Heat Network (DHN) Phase 2 Study to Develop Full Business Case

Decision Maker: Head of Major Projects and Commercial Services

Decision status: For Determination

Is Key decision?: No

Is subject to call in?: No

Purpose:

In November 2021 (Report HPS 29), Cabinet approved the funding for a study to examine the technical feasibility and economic business case for the Phase 2 expansion of the Town Centre DHN to incorporate properties and developments adjacent to the existing DHN. The study would also examine the potential to amend the fuel source from gas to a more sustainable heat source in line with the Council’s carbon reductions commitments.

The study was to be carried out in two phases, phase 1 feasibility and phase two full business case. Consultants to conduct the studies were subsequently procured and the first phase of the study (feasibility) has now been completed.

Cabinet delegated authority to the Head of Major Projects and Commercial Services in consultation with the Cabinet Member for Environment and Sustainability to review findings of the feasibility study once and decide whether to proceed with the second phase.

The feasibility study outlined an economically viable option for the expansion of the DHN, so it is recommended to proceed to the second phase of the study - the full DPD (detailed project development) and business case assessment for the expansion and decarbonisation of the Town Centre DHN.

HNDU funding of £129,950 has now been secured for this work, which the council will match fund with £55,000 from the Town Centre Capital budget (already allocated).

The DPD study could commence as early as January 2023 and will take around 9 months.

Decision:

Approve proceeding with the second phase of the District Heat Network (DHN) Phase 2 expansion and decarbonisation study to produce a full business case for the project and earmark a further £55,000 match funding from the Town Centre capital budget for this purpose.

The decision has been taken following review of the outcomes of the first phase feasibility study in full consultation with the Cabinet Member for Environment and Sustainability who gave his approval at his Portfolio Briefing on 5 January 2023.

Alternative options considered:

Not proceeding with developing the full business case would not allow the council to be in a position to apply for BEIS Green Heat Network funding which could make a substantial contribution to commercialisation and construction costs or move into construction of the project in time for the expanded network to meet proposed timelines for developments to connect.

Publication date: 16/01/2023

Date of decision: 11/01/2023