CARBON-FREE HEAT: Bridgend Council takes next steps to invest in scheme
Councillors have approved a new loans policy in support of a low-cost, carbon-free heating scheme in Bridgend.
Members of Bridgend County Borough Council (BCBC) voted in favour of increasing loans to third parties so the council can invest in a special purpose vehicle (SPV), or separate company, to deliver the Bridgend Town Heat Network.
The Bridgend Town Heat Network is a scheme which aims to heat buildings across the borough in an environmentally-friendly way.
The council approved a policy within its latest capital strategy to increase the amount of money it loans to third parties for the purpose of capital expenditure from £1 million to £2 million with the aim of supporting the heat network.
Labour councillor Paul Davies, who represents Caerau, said going ahead with the Bridgend Heat Network would be “just scratching the surface” of the climate emergency.
“We’ve got a climate emergency apparently, so the experts tell us… they reckon it would cost trillions to get to where we need to go to get to zero carbon.
“You look around, you’ve got cars everywhere, you’ve got planes lining the sky, you’ve got boats pumping our carbon. It’s everywhere.
“How are we going to get to zero carbon without starting somewhere and these are the schemes where you start and you build up from there. There’s no other way of doing it as far as I can see and ambition is the thing we need.”
Councillors approved the 2020 to 2031 capital strategy during a virtual meeting on Wednesday February 24 with 35 votes for, 14 abstentions and one vote against the new policy.
The council’s capital programme for 2020-31 states the Bridgend Heat Scheme will cost at total of £500,000.
The UK Government gave the council a £1.25 million grant towards the heat network in August 2021.
The first phase of the heat network project aims to have a combined heat and power boiler up and running at Bridgend Life Centre by 2022.
This will heat the Life Centre, Bowls Hall, and Civic Centre through a new system of distribution pipes, which take excess heat from a combined heat and power plant and thermal storage facility.
The second phase of the plans will use this system to heat Princess of Wales Hospital, Glanrhyd Hospital, and the Wildmill Estate.
Multiple schools, houses in Brackla, the Parc Afon Ewenny development, South Wales Police Headquarters, and industrial parks could also benefit from the scheme thereafter.
Council leader Huw David said the local authority must establish an SPV in order to receive a £1.25 million grant from the UK Government for the heat scheme.
“I’m sure one thing we can all agree on in this chamber is none of us want to send any money back to London. It’s an investment that we want to see in the town of Bridgend.”
Cllr David also said the heat scheme is part of the council’s decarbonisation agenda and response to “extreme weather” and flooding, as seen in Rhondda Cynon Taf.
Conservative councillor Lyn Walters asked where the council will find the expertise to run the company.
The Oldcastle representative said: “It’s an incredibly cut throat business. The thought that Bridgend has staff who are able to do that is pushing it in my mind.”
Ms Lewis said the council will have “some element of control” over the investment in the heat scheme and measures will be taken against money not being reinvested in the council.
She added that there is “an element of risk” in the project “as there is with any loan” and the SPV which delivers the project will be “closely linked “ to the council and have representation from the local authority.
Cllr Julia Williams, independent representative for Hendre, said she had a “bee in [her] bonnet” about the money spent by the council on consultants.
“Although the budget has gone through today, all of us and I’m sure that my friends in the Labour group as well, they don’t want to put up council tax, we know this, but unfortunately council tax has gone up and some of my constituents in Hendre can barely afford to feed their children let alone pay any more council tax.
“We’re talking about spending thousands of pounds on advisors and consultants about some heat project and quite honestly, the heat projects that we’ve done in the past haven’t been exactly successful.
“Let’s get this year over this first – we’re just coming out of one of the worst things that have happened in my lifetime… shouldn’t we be looking at what we’re doing today and not worrying about what we’re doing tomorrow?
“Just for now – I know we have to look ahead but to spend thousands of pounds on something like this when some people cannot afford to put food in front of their children.”
The UK Government is investing around £320 million in heat networks across England and Wales up to March 2022.
Cardiff Council received £6.6 million in August 2020 for the Cardiff Heat Network which will heat buildings in the Cardiff Bay area from a local waste plant via underground pipes.
Corporate director for communities Janine Nightingale said the Bridgend heat network forms part of the council’s decarbonisation strategy for 2030 and similar schemes in the UK “have been very successful”.
She said council officers will present a “detailed report” on the heat scheme to cabinet members on Tuesday March 09.
The council must spend around £240,000 on preparing for construction of the project and select a company to design, build, and maintain the network by the end of March.
“We have not committed any money for any expenditure yet that will be subject to another cabinet process and another approval,” said Ms Nightingale.
“This is not about creating profit, this is about creating a sustainable decarbonisation district heat network for Bridgend and hopefully if we get success in phase one, which is very much our ambition, we can move that district heat into phases two and three and really get some momentum behind it.”
She added the council’s energy schemes are funded by central government rather than council funds.
“Just because the money comes from somewhere else, in my opinion doesn’t make it right,” said Cllr Williams,
“Money is going on projects which in my opinion are a complete waste of money while other projects are underfunded.
“We should be one council and if there’s money over in one department it goes into another. I’m just exasperated by it.”
Chief executive Mark Shephard said public sector funding is “not quite joined up” in the way Cllr Williams would like it to be.
Mr Shephard said refusing the funding from Welsh Government for the heat network would not help Cllr Williams’ constituents because “some other authority would grab that money instead”.
“While I have an enormous amount of sympathy for some of the perhaps failings of the public sector in seemingly having different aims and different objectives… in this particular case it isn’t a case of if we didn’t take the money we could spend it on something else.”
Cllr Richard Young, cabinet member for communities, said the council alone does not have the expertise to run the heat scheme, which is why another company will be required to do so.
“We have to go outside the authority to get that expertise so that we don’t waste money and we do actually follow these projects and get the full benefit from them for the people who live in Bridgend county borough.
“The opportunity here is too good to miss. We have not failed in any of the projects we’ve brought forward or announced within the council.”
Cllr Young said the use of an SPV is “probably new for Bridgend” but “other local authorities have formed SPVs for various things”.
“It’s simply an arm’s length company to give us the ability to provide a service to the people of Bridgend that I think is sorely needed.
“It’s part of our 2030 agenda so it is linked to our carbon reduction strategy.”
Matthew Voisey, also a Conservative councillor for Oldcastle, said the council has not had “a great track record in any of the energy projects” it has been involved in.
Cllr Voisey asked for reassurance that the heat scheme will not be “just another white elephant that costs the council tax payer”.
“I’m assuming that we know that the life centre hasn’t got a 40 year life left in it? I just don’t seem to have a huge degree of confidence in this project and would like to see more information rather than just signing off now a couple of lines in a budget programme.”
Ms Nightingale said the council’s other heat schemes are “demonstrating new innovative technology” and it is too soon to judge whether they have been successful as they have not yet been fully implemented.
“In Scotland they’re very well advanced with their district heat networks, dare I say they’re probably leading the field.”
Cllr Young said: “The Caerau mine water for instance is not dead, there will be a mine water element to that project, it’s just that we have expanded it to take in other forms.
“In the words of the old A-Level exam, we can compare and contrast to see what is more efficient and where we need to go in the future to build the economy and to build the infrastructure that supports that economy.”
Words: Hannah Neary, Local Democracy Reporter
Watch the channel on TV