Purpose

To purchase and take delivery
of a further 3 years of electricity and gas services from framework supplier/s.
Services to be provided
using framework agreement
with the supplier/s which
regulates, the aggregation of the customer portfolio, the forward purchasing of
electricity and gas for
the aggregated customer portfolio,
the locking and unlocking of wholesale electricity
and gas prices,related hedging activities and the
scheduling of supply of electricity and
gas to customers. Theestimated contract value
of the additional
3 years is £53.4m.

Decision

Summary of
Decision
The Cabinet Member for Finance and Council
Reform has approved: 

WCC’s continued commitment to
the CCS Supply of Energy 2 Framework (RM6251) for the provision of
gas and electricity for up to a further 3 years from 1 April 2025
to 31 March 2028. 

The direct award under CCS Framework
Supply of Energy 2 RM6251 of a contract for the provision of
electricity to EDF Energy Limited (company number 02366852) for the
period from 1 April 2025 to 31 March 2028 for an estimated total
sum of £19.83 million exclusive of VAT, £23.78 million
inclusive of VAT.   

The direct award under CCS Framework
Supply of Energy 2 RM6251 of a contract for the provision of gas
supply to TotalEnergies Gas & Power Limited (company number
02172239) for the period from 1 April 2025 to 31 March 2028 for an
estimated total cost of up to £33 million exclusive of VAT,
£39.6 million inclusive of VAT. 

 
 
Reasons for
Decision
Westminster City Council (WCC) is in
‘evergreen’ rolling energy contracts,  with Crown Commercial Services
(CCS) acting as the broker with EDF Energy Ltd and Total Energies
Gas and Power Ltd as the energy suppliers. An emergency cabinet
member decision was granted to approve a one-year extension on the
current utility contracts with CCS, from 1/4/2024 - 31/3/2025 on 15
September 2023. This decision was necessitated by the forward
purchase nature of utilities contracts.
 
Following on from this decision the Council
has undertaken a full options appraisal of the procurement of its
energy supply. The review considered historical and current
relative price performance versus the market average. At the price
comparison point, CCS offered lower prices than the LASER offer.
There will be a yearly review of basket / strategies which will
consist of benchmarking of the purchasing strategies offered by CCS
to determine whether it would be advantageous for the Council to
change strategies dependent upon the energy market projections.
 
Reasons for
Urgency
Under provision 33.14 of the Access to
Information Procedure Rules in the Council’s Constitution,
the Council may apply a case of special urgency to the rule to
publish notice of a decision 28 days in advance of that decision
being taken with the agreement of the Chair of the relevant Policy
and Scrutiny Committee. Cllr Angela Piddock, Chair of the Overview
and Scrutiny Committee agreed to this decision being treated as a
matter of special urgency on 13 September 2024. The decision could
be taken immediately after this agreement was given.
 
Adherence to the normal access to information
rules, and specifically the 28 day rule,
are not practical in these circumstances as Westminster City
Council must commit to the purchase window for the 2025-28
financial years by 15 September 2024, and not doing so would leave
the Council liable to increased costs.