Agenda item

RESOLVED:

That the Cabinet:

1.     Approves in principal the conversion of the Council’s street lighting assets to LED and delegates to the Head of Highways and Transport, in consultation with the Cabinet Member for Highways and Transport, the authority to issue a change notice under the Street Lighting PFI contract to enable the development of a detailed proposal. 

2.     Take a decision on whether to proceed based on a final detailed business case, including a technical solution and implementation programme, in Autumn 2018.

Reasons for Decisions

Energy price inflation is increasing at a significant rate (5%-14%) and to ensure lights are operational when needed, there is little opportunity for the Council to control or reduce its energy costs.

LED technology in street lighting has matured significantly in recent years while the costs have reduced. Many Highway Authorities have either embarked on an LED conversion programme or are in the process of planning to commence one within the next 2-3 years.

Converting to LED will reduce energy consumption by 60% delivering £2 million per year energy savings at today’s prices as well as reducing carbon impact by 6200 tonnes and avoiding the Carbon Reduction Commitment tax otherwise payable on the avoided consumption.

In addition to converting to LED street lighting and upgrading the Central Management System, Officers will be able to explore additional innovations now being used or being developed for use with street lighting such as:

·        Motion sensor controls to turn lights on in residential areas when people or vehicles approach and, off once they have passed

·        Providing real-time traffic movement data to help understand and ease congestion

·        Environmental sensors to detect and monitor air quality

The potential for these innovations may be in direct relation to street lighting (e.g. motion sensor controls) or in providing a communications network for other areas of the Council (and extending to partners in District and Borough Councils) to connect equipment to improve the services and outcomes they deliver. 

Furthermore, these innovations may present grant funding opportunities through central Government departments and the Local Enterprise Partnerships (LEPs) which would reduce the borrowing requirement for the Council.

The PFI contract allows for changes to the specification and service.  As explained in paragraphs 18-22, once a change notice is issued the process of identifying an appropriate solution to meet the Council’s needs begins which is expected to take 6-8 months to explore and agree before being presented back to Cabinet for approval, hence the reason for the 2 stage Cabinet approval.

[The decisions on this item can be called in by the Environment and Infrastructure Select Committee]

The Cabinet Member for Highways informed Members that the Council currently spent £3.5 million each year on energy for street lighting.  Recent projections indicated energy costs for street lighting would rise by between 5% and 14% over the next 10 years which could mean the annual cost increasing to nearly £15 million in that time and as high as £55 million per year in 20 years if prices rose by 14% each year. He went onto say that the Council had been looking into LED options for the 89,000 streetlights across the county and would be considering what new technologies are available. Members were informed that a 25 year agreement had been put in place in 2010 and that this would need to be revised in order to replace the street lights.

It was explained that by investing approximately £18.5 million over 3 years to convert the council’s 89,000 street lights to LED it would reduce their consumption by around 60% saving approximately £2 million per year (at today’s prices).

The Cabinet Member for Property and Business Services commended the report and stated that it was a very good idea with new and improved technology and stressed the importance of being innovative in order to attract funding to support the project and work with the PFI partner to ensure that the solution was right.

Members commented on how this would contribute to a reduction in emissions and this was welcomed.

RESOLVED:

That the Cabinet:

1.     Approves in principal the conversion of the Council’s street lighting assets to LED and delegates to the Head of Highways and Transport, in consultation with the Cabinet Member for Highways and Transport, the authority to issue a change notice under the Street Lighting PFI contract to enable the development of a detailed proposal. 

2.     Take a decision on whether to proceed based on a final detailed business case, including a technical solution and implementation programme, in Autumn 2018.

Reasons for Decisions

Energy price inflation is increasing at a significant rate (5%-14%) and to ensure lights are operational when needed, there is little opportunity for the Council to control or reduce its energy costs.

LED technology in street lighting has matured significantly in recent years while the costs have reduced. Many Highway Authorities have either embarked on an LED conversion programme or are in the process of planning to commence one within the next 2-3 years.

Converting to LED will reduce energy consumption by 60% delivering £2 million per year energy savings at today’s prices as well as reducing carbon impact by 6200 tonnes and avoiding the Carbon Reduction Commitment tax otherwise payable on the avoided consumption.

In addition to converting to LED street lighting and upgrading the Central Management System, Officers will be able to explore additional innovations now being used or being developed for use with street lighting such as:

·        Motion sensor controls to turn lights on in residential areas when people or vehicles approach and, off once they have passed

·        Providing real-time traffic movement data to help understand and ease congestion

·        Environmental sensors to detect and monitor air quality

The potential for these innovations may be in direct relation to street lighting (e.g. motion sensor controls) or in providing a communications network for other areas of the Council (and extending to partners in District and Borough Councils) to connect equipment to improve the services and outcomes they deliver. 

Furthermore, these innovations may present grant funding opportunities through central Government departments and the Local Enterprise Partnerships (LEPs) which would reduce the borrowing requirement for the Council.

The PFI contract allows for changes to the specification and service.  As explained in paragraphs 18-22, once a change notice is issued the process of identifying an appropriate solution to meet the Council’s needs begins which is expected to take 6-8 months to explore and agree before being presented back to Cabinet for approval, hence the reason for the 2 stage Cabinet approval.