A report by the Director of Law, HR and Asset Management detailed the impact on the Council Budget of annual changes to the Council’s electricity and gas supply contract prices provided under the framework agreement with Government Procurement Service, following the end of the 2010/11 contracts on 30 September 2011.

The new contract prices had significantly increased the purchase price of energy for individual accounts.  However, the disposal of properties and a number of schools attaining academy status had reduced the number of properties that had to be covered by the energy budget.

Cost projections had shown that it was necessary to increase the General Fund energy budget for Street Lighting by £342,000 in 2011/12 and £492,000 in 2012/13.  Other budgets for Electricity and Gas were to remain unchanged.  This reflected consideration of cost, energy usage projections and unit energy prices.

Members noted that individual Schools were likely to face increases in costs which would need to be met from within their delegated budgets.

RESOLVED: That

(1)  the offer made by Government Procurement Service which was competitively tendered and accepted using Delegated Authority be noted;

(2)  the impact of the revised energy contracts be reflected in the 2011/12 General Fund energy budget for Street Lighting and the increase of £342,000 be met from the General Fund balances;

(3)  the impact of the revised energy contracts be reflected in the 2012/13 General Fund energy budget for Street Lighting and the increase of £492,000 be met from the General Fund balances;

(4)  schools be advised of the additional costs that will impact on their budgets;

(5)  it be acknowledged that, despite changes to the budget provisions that are lower than unit price increases, individual sites will see their energy tariffs rise significantly.  Managers are, therefore, directed to make every effort to save energy at every opportunity;

(6)  it be acknowledged that no provision has been made for the 2012 contract renewals at this stage.  Given the unpredictability of the markets further reports will be presented to Cabinet as information is received; and

(7)  the revision to the projected annual allowance cost of the Carbon Reduction Commitment for Wirral Council be noted and the Budget for 2011/12 and 2012/13 be reduced from £532,000 to £203,613.