The Climate Action, Environment and Highways Policy and Scrutiny Committee met to review the call-in of a Cabinet Member Decision regarding the Future of Pimlico District Heating Undertaking (PDHU). The committee ultimately voted against referring the decision back to the cabinet, allowing the original decision to proceed. During the meeting, members raised concerns about consultant spending, the rationale behind technology choices, and the need for transparency in the decision-making process.

Future of Pimlico District Heating Undertaking (PDHU)

The main item under discussion was the call-in of a Cabinet Member Decision concerning the Future of Pimlico District Heating Undertaking (PDHU) - progress on initial outline business case. Councillors Jim Glen, Tim Mitchell and Ed Pitt Ford had requested the call-in. The Pimlico District Heating Undertaking (PDHU), the UK's oldest district heating system, faces challenges due to its age, including frequent leaks and high maintenance costs of £3.5 million annually. The council is exploring options for a long-term, efficient, and low-cost heating solution for residents and businesses.

Councillor Liza Begum, Cabinet Member for Housing Services, introduced the report, emphasising the need for investment and that funding would come from the strategic community infrastructure levy (SCIL) and not be charged to residents. Councillor Ryan Jude, Cabinet Member for Climate Action, Ecology, Culture and Air Quality, added that the funding would enable the next stage of the programme, allowing further analysis and statutory consultations.

The committee discussed several concerns:

• Consultant Spending: Members questioned the continued commissioning of consultants, the high consultant spend per flat, and whether using SCIL funds for consultants was a good use of public money. They also asked if the Cabinet was satisfied with the quality of the consultants' work and if doubling the spend would still represent good value.
• Technology Choices: The committee sought to understand why certain options, such as ground source heat pumps, had been ruled out and the consultants' role in deciding this.
• Future Proofing: Members questioned the level of confidence in spending more money with the same consultants regarding future delivery and programme development.
• Public Knowledge: Concerns were raised about the lack of declaration regarding AECOM's interest in the Mobile Heat Batteries and SWAN options, and whether alternative consultants could be considered.
• Consultant Delivery: The committee questioned how the scope had been redefined since 2023 and key delivery targets that had not been reached despite the funding to date.
• Quality of Analysis: Doubts were raised about extending the contract with current consultants, citing unclear assumptions, inability to justify qualitative analysis in public meetings, and disputed claims about grid connections.
• Breakdown of Spending: Clarity was sought on the figures provided, with confusion over total spends and potential unspent sums.
• Information for Decision Makers: Members questioned whether the Cabinet should reconsider the decision with the information now available.
• Duplication: Concerns were raised about whether the additional funds would duplicate effort.
• Resident Understanding: Members asked how important further consultant analysis would be for wider resident understanding and assurance.
• Consequences of Deferral: The committee questioned the repercussions of not spending the £1.2 million and the assurance on the quality of outcomes from this spending.
• Electric Heating Options: The importance of considering electric options at various scales was discussed.
• Alternative Decision Options: Members asked if the Cabinet could review the decision with a different funding amount or conditions on awards to consultants based on performance.
• Peak Marginal Cost for Grid Capacity (PM grid capacity): Clarity was sought on assumptions regarding PM grid capacity and whether grid upgrades would be required.

The committee requested a detailed breakdown of smaller spends, amounting to approximately £140,000, including spending on the resident technical advisor and feasibility studies.

A vote was held, and the committee voted 4-3 to note the report and take no further action, allowing the Cabinet Member Decision to be implemented.

Councillor Jason Williams, Jim Glen, Ed Pitt Ford and Liza Begum declared interests in this item, as ward councillors in areas serviced by PDHU. Councillor Ed Pitt Ford also declared investments in Octopus Energy and Octopus Investments.

Other Matters

The committee noted that it would review its previous minutes at the next meeting.