Bristol City Council will be able to put a cap on energy prices for customers on heat networks, the city's mayor has said.
Earlier this week, the council announced it had chosen renewable energy firm Ameresco Ltd as its City Leap partner, with the two organisations forging a 50/50 joint venture. The deal commits Ameresco to invest £424million in low-carbon energy infrastructure, such as heat networks and heat pumps, which will remove 140,000 of carbon across the city in the first five years of a 20-year agreement.
Bristol City Council will grant access to its estate with the American business retrofitting its social housing by 2030 and paying the authority a guaranteed £4.2million. The City Leap partnership will work with Sweden’s nationally owned energy company Vattenfall Heat UK which will effectively buy and run all the council’s heat networks that the authority has been building since 2015.
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Councillors heard a big reason Ameresco had been picked ahead of two other consortiums who made the final three was that consumer protections were written into the deal, following reports about astronomical bills, a complete lack of choice of suppliers and mammoth disconnection fees in the heat networks market which is currently unregulated.
Speaking during a press briefing earlier this week, city mayor Marvin Rees said: "Where government have failed on heat networks, we have stepped up. In our arrangements, we become the authority that puts a cap on prices for customers on heat networks.
"It is releasing a technology, releasing the finance, but importantly it is about us taking control in a wild west of energy that is impacting so many households. We cannot decarbonise the city's energy system unless we have heat networks, we can not have heat networks if we are not including private money - it has to include public and private money, so this arrangement, bringing public and private together, is the way we are going to get the scale of change at the pace it needs to be delivered."
Growth & regeneration executive director Stephen Peacock told overview & scrutiny management board (OSMB) members that safeguards had been put into the paperwork, adding: “The overarching principle here was to protect residents, consumers from positions where there would be effectively a natural monopoly in advance of a well-developed regulatory regime.”
Head of the city council’s energy service David White said: “The bidder has put in a lot of really strong things in terms of consumer protection. We can’t say more here today because it’s one of the reasons why they won the bid so it’s commercially confidential.”
City Hall bosses told a council meeting on Tuesday that the agreements, which now need to be finalised over the next few months following approval by cabinet next week, ensured the local authority was not entering into any new financial commitments and that the risks were with the private sector.
