Agenda item

To discuss the issue of solar energy charges to schools.

Sarah Morgan, Assistant Director for Commercial Property shared a presentation and highlighted the following points:

·           WBC’s Capital investment in renewable energy at schools started in 2012;

·           This strategy was reinforced by the Climate Emergency declaration in 2019, which aimed to encourage the development of renewable energy and engagement with young people and promoting sustainable schools;

·           Over £4 million was invested in 55 school sites since 2012;

·           WBC considered these projects as ‘invest to save’, there was an expectation that the capital investment would be paid over a period of 25 years;

·           The change that was being proposed was driven by the context of raise in cost of energy prices;

·           WBC’s electricity’s contract had gone up by 47% over five years;

·           The change aimed to mitigate the circumstances of raising costs to schools and the Council, by retailing the solar energy produced by solar panels in a different way;

·           The values that would be charged would be the same for maintained and academy schools, but the processes used for charging would be different;

·           In the current arrangements, 90% of the energy produced by solar panels is sold back to the grid and an income is generated.  The remaining 10% of energy is utilised on site.  The 10% used by the school is at nil cost, but it is a small proportion of the energy needed, the remaining energy that is needed is bought at £0.25pence per kilowatt hour (kWh);

·           The proposal is to retain 90% of the solar energy produced by the school’s solar panels and retail 10% back to the grid.  It was proposed that the energy that was free before, be charged at £0.17pence kWh – significantly less than £0.25pence kWh;

·           Whilst the solar energy cost was going up, the school would utilise much more of the energy they produced and pay significantly less per kWh;

·           If schools did not agree to the new proposed charging arrangements, the current arrangements would continue with the existing contracts.  All schools had slightly different contracts, depending on when they were agreed since 2012;

·           Schools were encouraged to change to the new contract as it was believed that this would be beneficial to both schools and the Council;

·           Schools that did not have any renewable energy sources in their sites would continue to purchase energy at £0.25pence kWh and this was likely to go up in the next few years.  Those schools were encouraged to contact the Council about investing in renewable energy;

·           Some schools had already signed up to the new contract.  Schools that hadn’t were encouraged to contact Ian Gough, Energy Manager and his team to discuss individual circumstances;

·           In relation to the fee paid to the Council’s energy team.  Schools paid a fee of 2%, the energy team who provided procurement of energy supplies, with access to lower energy rates.  The fee provided around £80k per annum, which was used to help with staffing costs, but was also re-invested in schemes;

·           Schools could opt out of using the energy team from the Council, but would then have to use someone else to undertake the procurement function.

Some of the questions and comments made during the discussion of the item are listed below:

·           Councillor Pittock was of the opinion that as well as looking at the cost of energy, consideration should be given to the insulation of buildings and minimising the loss of energy.  He asked if this was being done?

·           Ian Gough confirmed that the team looked at every project that could help with energy reduction.  The team worked closely with the property team to optimize opportunities to insulate buildings;

·           Councillor Pittock asked if there was support for schools to change cold roofs to warm roofs?

·           Ian Gough stated that the Council was ready to work with schools in energy reduction projects with an invest to save approach, with a view to recover the capital investment in a period of time;

·           Carol Simpson stated that her school had had very good support from the Council over the years, for example with lighting replacement and heat pumps for the swimming pool.  However, she still felt very confused about the solar energy charges which were being proposed;

·           Carol Simpson stated that the contract they had stated that they fully utilised the energy produced by the school’s solar panels.  The information being presented contradicted the statements in the contract, she wondered if schools had been overcharged since 2012?

·           Carol Simpson expressed frustration that she had been asking for an example of the implications of this change to her school since January 2023, and many colleagues had been doing the same, without a response being given.  Schools were going to have to submit their P9 budget monitoring soon, and this charge would go back to April 2023, there was still no clarity for budget forecasting;

·           Ian Gough stated that all the schools forecasting was ready to go out, unfortunately this would go out with the bill.  Sadly, it had taken a long time to work out the information for each individual school due to the fact that there were nuances for each individual school;

·           Sarah Morgan asked Ian Gough to meet with individual schools, without delay, to discuss their position;

·           Andy Hinchliff agreed that it was important to have the detail before singing a new contract.  He asked if £0.17pence kWh was an actual amount or an amount because of a percentage reduction from the overall charge that a school could expect?  Could there be a variation from £0.17pence kWh?

·           Ian Gough explained that £0.17pence kWh was 30% reduction on the charged rate of import.  The Council would look to maintain the cost at 30% lower than the market rate, but the £0.17pence kWh could change;

·           Liz Woodard stated that it would have been helpful to have seen an example of a school scenario before the new contracts were proposed.   She asked how would it work in terms of getting a bill after the forecast was done for last year?

·           Ian Gough explained that conversations about this had started over a year ago.  The team would like to have sent the bills in October 2023, but it was now ready to go;

·           In response to a comment, Ian Gough confirmed that schools would get a bill from April 2023, after the schools forecast was done;

·           Sarah Morgan asked to re-consider the issue of timing of bills outside of the meeting;

·           Liz Woodards expressed frustration that schools business managers had been asking for more information for a year, with no response from the energy team;

·           Debra Briault stated that more detailed information was needed in the contracts, including charging points and credits.  If schools had been overpaying since April, would they be refunded?  Also, academies and multi-academy trusts needed this information as they were the ones who would sign the contract on behalf of their schools;

·           Ian Morgan asked if there was an opportunity for the Early Years sector to benefit from the Energy Team procurement service?

·           Ian Gough agreed to work with Ian Morgan about options for the Early Years sector;

·           Chris Connian asked for clarification in regard to the bill.  Ian Gough explained that the bills had been worked out on the basis of charging £0.17pence kWh.  Sarah Morgan clarified that bills would be different depending on schools having signed the contract or not;

·           Carol Simpson stated that her school had not received an energy bill since October.  Ian Gough agreed to investigate.

Councillor Bray suggested that the Energy Team work together with Debra Briault to ensure that the new contract contained the right information for schools.

RESOLVED That:

1)     The presentation would be circulated to Schools Forum members; and

2)     New contracts would include more details, including different scenarios to make it clearer for each individual school.