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RESOLVED: That Cabinet:
 

(1)  
Agreed in principle to terminate the Combined Heat and Power
Centrica contracts at North Herts Leisure Centre (NHLC) and Hitchin
Swimming and Fitness Centre (HSFC) at the appropriate time during
the PSDS project and recommend to Council as per 2.6 below
regarding the termination fee.

 

(2)  
Expressed its profound disappointment at the position taken by
Centrica over the cost of the CHP contract termination, given the
company's stated position as "Energising a greener, fairer future"
and requests that the Council continues to raise, and seek
solutions to, the issue of long-term inflexible agreements for gas
CHPs with Salix and Government, which will inevitably prevent many
public sector organisations from achieving their net zero
ambitions.
 

(3)  
Did not approve the business case for Royston Leisure Centre
Learner Pool at this time due to matters identified in the Part 2
report.
 

(4)  
Agreed that the Project Board would review the business case for
the Royston Learner Pool, after further work had taken place to
explore any other funding options that were realistically
available. That review would then feed into the planned review of
the Councils capital programme, as part of the 2025/26 budget
setting process. 
 

RECOMMENDED TO COUNCIL:
 

(1)  
An increase in capital expenditure of £2.4m into the capital
programme for the decarbonisation work to the three leisure
centres. The overall budget will be profiled across 2024/25 and
2025/26.
 

(2)  
An increase in the capital budget of £250k for the Royston
Leisure Centre (RLC) gym extension, to ensure the extension is
built to net zero carbon standards.
 

(3)  
Approval of revenue expenditure of up to £757k for
termination and removal fees of the gas CHPs at North Herts Leisure
Centre and Hitchin Fitness and Swimming Centre. This would be
funded from General Fund reserves.To take this Part 2 report into
consideration when reaching the decisions detailed in Part 1.
 

REASONS FOR DECISIONS:

 

(1)  
North Herts Council passed a climate emergency motion in May 2019.
This declaration asserted the council’s commitment toward
climate action beyond current government targets and international
agreements. This is currently pursued through the North Herts
Climate Change Strategy 2022-2027 which sets out what the council
will aim to do to reduce its own carbon emissions to achieve Carbon
Neutrality for the Council’s own operations by 2030 and a Net
Zero Carbon district by 2040.

 

(2)  
Gas use from our leisure centres is a significant contributor
towards the Council’s own emissions. In 2022-23, gas use
across the three leisure centres accounted for 1,428 tonnes CO2e.
This equates to 45% of the Council’s Scope 1-3 emissions.
Taking action to replace gas heating for our leisure centres with
low carbon alternatives is the single most effective action we can
take towards meeting our target of being carbon neutral by
2030.
 

(3)  
There is currently a capital allocation in the 2024/25 budget to
build a gym extension and learner pool (subject to business case)
at Royston Leisure Centre.
 

(4)  
During the procurement for the leisure and active communities contract, the Council committed to
deliver the gym extension project which is incorporated in to the
contractual management fee. The initial tender stage returns showed
that extension would generate additional income of at least
£150k per year, and subject to inflationary increases. The
latest estimate is that the capital costs will be £1.25m.
This is an increase from the initial estimate of £1m and
includes making the extension net-zero. The income generated will
still exceed the revenue cost of capital (at around £90k per
year), but in line with the financial regulation the increased
capital spend needs to be approved by Cabinet.
 

(5)  
The business case for the learner pool has not yet been agreed and
is included in the Part 2 report.