Decision details

Decision required to sign a trading/access agreement and award new supply contracts for the provision ofenergy to Surrey County Council.

RESOLVED:

1.     That authority be delegated to the Director of Procurement, Chief Property Officer and Head of Highways & Transport in consultation with the relevant Cabinet Member to enter into appropriate Customer Access Agreements through the Crown Commercial Service framework agreement for the supply of electricity, gas, other fuels and ancillary services be agreed.

2.     That authority be delegated to the Director of Procurement, Chief Property Officer and Head of Highways & Transport in consultation with the relevant Cabinet Member to procure and award a call off contract under a Crown Commercial Service framework agreement for the council’s gas and electricity supplies for a term of up to four years be agreed.

Reason for Decision:

Energy supplies are essential in order for the Council to continue operating its premises in a way which is compliant with relevant standards of health and safety.  The price paid for energy is expected to increase over the medium to long term, driven up by increases in the non-commodity charges, which are set by government regulations.  This will place additional pressure on Council finances, which can be mitigated to some extent by using the expertise of a Central Purchasing Body to buy energy in the wholesale markets when conditions are more favourable.

The award of this contract will enable uninterrupted provision of the service whilst also allowing flexibility to accommodate any possible change in the level of usage. Even though initiatives such as the Surrey Transformation Programme and LED street lighting investment will reduce the council’s demand for energy significantly, energy costs are likely to remain at a level requiring attention of the council’s members and senior leaders for the foreseeable future.  The award will deliver estimated financial cash releasing and non-cash releasing benefits of:

·         £20k pa in reduced buying agency management fees

·         £233k pa mitigation of expected increases in the wholesale cost of energy

·         500 hours of staff time in Procurement activity.

[The decisions on this item can be called in by the Corporate Overview Select Committee]