Decision

RESOLVED that Harlow Council awards a contract to EDF with a forecasted value of £1,497,392 for supply of electricity to operational and housing properties from 01 April 2027 – 31 March 2028.

Reasons for the decision

To ensure that the Council secures an electricity supply contract at favourable costs conducive to the market, whilst also reducing the Council’s exposure to volatile price fluctuations due to ongoing geopolitical events.

Alternative options considered

Do nothing – by doing nothing, the council’s current electricity supply contract will come to an end, meaning that all sites within the portfolio will subject to out of contract tariffs, which will impose a significant cost implication. By entering into contract, this mitigates this risk by securing electricity supply at competitive tariffs. Furthermore, by doing nothing and signing an electricity contract at a later date, the Council is further exposed to potentially higher energy rates as there is little bearish sentiment in the wholesale market that geopolitical instability in the Middle East will reduce in the near term.

Flexible contract arrangements - The council could enter into a “flexible arrangement” whereby energy is purchased and sold at various times on the futures market to secure the best aggregated rate available. However, whilst this can mitigate against volatility in the market, with current power cost increases being attributed to non-commodity costs, this approach for purchasing the commodity does not mitigate non-commodity cost increases.