Decision

1. That Cabinet recommends to Council:

That the following decision of Council made on 18 July 2024 be rescinded:

‘that up to £2,750,000 of prudential borrowing be approved subject to securing a unit rate per MWh that exceeds the loan repayments, covers projected maintenance and other operational and equipment replacement costs and provides an appropriate surplus per annum over the life of the scheme commensurate with level of risk.’

1. That the following decision of Cabinet made on 11 June 2024 be rescinded:

‘that the Chief Executive in consultation with the Leader of the Council, Finance Director and Cabinet Member for Finance should review and agree the final business plan after the EPC tender and Power Purchase Agreement (PPA) stage are complete and subject to that agreement is then authorised to agree and finalise the detailed terms and enter into contract with South West Water (SWW) or another purchaser of the electricity.’; and

1. That subject to 2. above authority be delegated to the Director of Finance, in consultation with the Cabinet Member for Place Development and Economic Growth, to agree and finalise the detailed lease terms, in line with an independent market valuation, and enter into a long lease for the land edged red as set out in Appendix 1 to the submitted report.

Reasons for the decision

The delivery of a solar farm would reduce carbon emissions within Torbay in line with the Councils Energy and Climate Change Strategy.  The solar farm would provide renewable energy to a SWW water treatment plant at Galmpton.  The water treatment plant serves Torbay residents.

Furthermore, by leasing its land the Council would benefit from a capital receipt at the outset, equivalent to the costs incurred to date in obtaining planning consent.  In addition, an annual market rent would be paid to the Council by the Pennon Group in accordance with the lease terms over a maximum 40 year period.

Alternative options considered

The PPA option involved delivering the solar farm directly and providing guaranteed power to the end user.  This option posed a greater obligation on the Council when compared to the lease option.

As an alternative to the PPA option, the land could be leased to Pennon.  Pennon would then be responsible for funding and carrying out the construction work.  Torbay Council would receive an annual market rent for the period of the lease.