Agenda item

Briefing Note of the Director of Property Services and Development

The Business, Economy and Enterprise Scrutiny Board (3) received a briefing note and presentation of the Director of Property Services and Development that provided an update on the progress of the Public Sector Decarbonisation Scheme (PSDS) project since Cabinet and Council approved the proposals on 9th December 2020 and 16th December 2020 respectively. Copies of the reports were attached as appendices to the briefing note.

The UK Government committed to provide financial support to help stimulate the economy following the economic downturn caused by the Coronavirus pandemic. They had established a number of funding schemes aimed at supporting the wider agenda of “Building Back Better” through supporting green job growth. The Department for Business, Energy and Industrial Strategy (BEIS) launched the Public Sector Decarbonisation Scheme on 1st October 2020. The Grant Scheme was delivered by Salix Finance and aimed to allocate up to £1bn of grant funding to encourage green investment aligning with the Government’s Net Zero and clean growth goals.

The final value of the PSDS Bid 1 grant of £6,052,216 was confirmed on the 11th January 2021 and included 120 eligible measures across 29 Coventry City Council owned and operated properties. Eligible measures were categorised as: low carbon heating; energy efficiency measures; non-efficiency measures that supported decarbonisation; and fossil fuel replacement of oil and coal. The Director of Finance, in consultation with legal and property officers, accepted the grant on the 19th February 2021 and work to take the approved projects to the delivery stage. The Council were informed by BEIS on the 25th February 2021 that a further grant allocation for the maintained education portfolio could also be funded and a provisional offer of a second grant for £2,486,827 for Coventry City Council educational properties was made. Due to timing constraints the grant was accepted by the Chief Executive, following consultation with the Cabinet Member for Education and Skills and the Director of Law and Governance, under emergency powers, on the 25th February 2021.

Funding aimed to support measures that did not meet traditional “Financial Payback” criteria. No match funding was required as long as projects met the PSDS criteria of £500 per tonne CO2 saved in the project lifetime and there was no maximum Grant Value. There was a very prescriptive definition of what was eligible as a “Public Building”, which could not be charity or voluntary organisation operated.

An Initial review of the potential deliverable pipeline of eligible projects indicated a grant request of £6m for Corporate Properties (Bid 1). A further desktop review by Greener Energy Futures indicated an additional £2.4m for primary school improvements may be possible (Bid 2). Both applications were submitted by the 11th January 2021 deadline to be assessed for Phase 1. PSDS Phase 1 had £2.4bn of bids submitted. The Authority was initially told Bid 1, with a target financial saving of £59k per year, was successful but Bid 2 with a target financial saving of £88k per year was unsuccessful. Due to unclaimed grants CCC were subsequently awarded Bid 2 grant as part of new Local Authority Grant Process. This grant included 49 eligible measures across seven City Council Maintained Schools.

The Council had now begun the process of delivering the projects that secured funding with a deadline of 30th September 2021 to complete the works.

The Board questioned officers, received responses and discussed the following issues:

·  Academy schools could not be included in the Authority’s bids.

·  The limited timescale for submission of the primary school bid required the inclusion of only those schools that were in a position to deliver the measures within the timeframe

·  Scoping of all of the city schools in preparation for future bids would ensure that the Authority was in a position to submit bids quickly

·  Consultants were engaged to assist with supporting the work on the bids

·  A government decision to initially focus on district heat networks and to reduce the available funding to £70m, then to change focus to include schools, had impacted on the Council’s timescales and capacity to work on the bid for schools

·  The definition of match funding was a combination of 50% of a project cost being borne by the Authority and 50% being received in grant funding. These decarbonisation projects did not require match funding

·  These schemes were an important part of a wider agenda for climate change and environmental improvements that would see the Authority supporting the Government’s clean growth goals

Members of the Board requested that a list of Council buildings that would benefit from the funding secured, to include details of the initiatives/eligible measures that would be progressed in each building, be circulated to them. They further requested that similar information be circulated to them for school buildings, when it was available.

RESOLVED that the Business, Economy and Enterprise Scrutiny Board (3):

1)  Notes the work undertaken to date to secure funding under the Public Sector Decarbonisation Scheme Grant Award

2)  Supports the progress made in delivery of the initiatives for which funding has been secured.