Report - Development of Outline Business Cases (OBC)
Renfrewshire Council · 13 February 2025
Back to Finance, Resources and Customer Services Policy Board — 13 February 2025 and its agenda
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__________________________________________________________________ To: Finance, Resources and Customer Services Policy Board On: 13 February 2025 __________________________________________________________________ Report by: The Director of Environment, Housing and Infrastructure and the Director of Finance and Resources __________________________________________________________________ Heading: Notification of the award of a Contract for the Development of Outline Business Cases (OBC) for Paisley Central and Paisley North (AMIDS Extension) potential district heating networks (RC-CPU-24-169) under standing order 9.1k) of Council Standing Orders Relating to Contracts. __________________________________________________________________ 1. Summary 1.1. The purpose of this report is to notify the Finance, Resources and Customer Services Policy Board of the award of a Call-Off Contract for the Development of Outline Business Cases (OBC) for Paisley Central and Paisley North (AMIDS Extension) potential district heating networks (RC- CPU-24-169) under standing order 9.1(k) of Council Standing Orders Relating to Contracts 2024. 1.2. The Council received a grant from the Scottish Government to develop an Outline Business Cases for a Paisley Central and AMIDS DHN extension, a condition of which requires the services funded by the grant to be complete and paid for by 31 March 2025. To ensure the grant could be utilised within the required timescale, the Interim Corporate Procurement Manager approved the use of standing order 9.1(k) of Council Standing Orders Relating to Contracts which requires the retrospective reporting of the contract award to this Policy Board. 1.3. A procurement exercise was conducted as a further competition in accordance with the procedures for Lot 4.1 Heat Networks – Heat Network Design of the Crown Commercial Services Demand Management and Renewable Framework reference RM6314. A recommendation to award a Call-Off Contract in accordance with Standing Order 9.1(k) was approved by the Interim Corporate Procurement Manager on 20 December 2024 and the
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Head of Climate, Public Protection and Roads on 23 December 2024. A Call- Off Contract was awarded by the Director of Environment, Housing & Infrastructure on 23 December 2024. ________________________________________________________ 2. Recommendations The Finance, Resources and Customer Services Policy Board is asked to note that: 2.1. Section 3 of this report which details a Call-Off Contract made under 4.1 of the Crown Commercial Services Demand Management and Renewable Framework reference RM6314 for the Development of Outline Business Cases (OBC) for Paisley Central and Paisley North (AMIDS Extension) potential district heating networks (RC-CPU-24-169) was awarded to Buro Happold Limited, in accordance with clause 9.1(k) of Council Standing Orders Relating to Contracts January 2024 by the Director of Environment, Housing and Infrastructure. 2.2. The total of the prices is £174,937.00 excluding VAT. 2.3. The allowance for additional services related to development of the OBCs, which may require to be instructed by the Council during the contract period, is £43,734.25 exclusive of VAT. 2.4. The Approved Contract Value of up to £218,671.25 excluding VAT for the duration of the Call Off Contract (including the total of the Prices and the allowance for additional services required related to the OBC development). 2.5. The starting date was 6 January 2025, and the completion date for the whole of the Services is anticipated to be 31 May 2025. 2.6. The Consultant’s total liability to the Council is limited to a minimum of the levels of insurance to be maintained where insurance is required in accordance with the Call-off Contract and is limited to £1,000,000 in the annual aggregate for uninsured losses. The Consultant’s liability for matters which would be covered by professional indemnity insurance is therefore limited to £1,000,000 each and every claim.
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3. Background 3.1. Renfrewshire’s Local Heat and Energy Efficiency Strategy (LHEES) was approved in January 2024, with the Delivery Plan approved in August 2024. Following the completion of Renfrewshire’s LHEES, further work was undertaken with Zero Waste Scotland and the Heat Network Support Unit to explore opportunities which had been identified as having potential for heat network zones. This led to the identification of an opportunity to merge initial zones to create a potential large ‘Paisley Central’ heat network zone; as well as exploration of options to extend the existing AMIDS district heating network, which became operational in May 2023. 3.2. Renfrewshire Council received initial support from the Heat Network Support Unit (HNSU) for detailed feasibilities for Paisley Central and AMIDS Extension. The detailed feasibility studies showed both projects to be potentially viable. Renfrewshire Council have now secured additional HNSU funding (50% match funding) to progress the detailed project development phase, to provide the Council and/or key stakeholders the detailed information required to enable informed decision making around capital funding and proposed delivery models for each of the potential projects. 3.3. The Council required to procure consultancy support to develop Outline Business Cases for the two identified heat network opportunities, to fully assess the viability of the proposed projects individually: • a potential Paisley Central district heating network, and • the potential extension of the existing AMIDS district heating network. 3.4. This procurement exercise was conducted as a further competition in accordance with the procedures for Lot 4.1 Heat Networks – Heat Network Design of the Crown Commercial Services Demand Management and Renewable Framework RM6314 and the Council’s Standing Orders Relating to Contracts. 3.5. There are 19 suppliers registered on Lot 4.1 of the Framework. In accordance with the Framework call off procedures, an Expression of Interest was sent to all 19 suppliers in advance of ITT publication. Of the 19 suppliers, 10 expressed interest in the tender and were then invited to tender on 22 November 2024. 3.6. By the closing date set for tender submissions, 12 noon on Wednesday 11 December 2024, 3 suppliers had submitted a response, 2 suppliers declined to respond, and 5 suppliers did not respond.
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3.7. All suppliers who submitted tender submissions continue to meet the requirements of the Single Procurement Document (SPD) they completed when applying for a place on the Crown Commercial Services Demand Management and Renewable Framework reference RM6314. The 3 tender submissions were each evaluated against the award criteria of 40% technical (quality) and 60% commercial (price). 3.8. In accordance with the ITT for the further competition issued by the Council, the Council reserved the right to disqualify from the tender process any supplier who received a score of Unacceptable or Poor in any scored questions. 1 tenderer received a consensus score of 1 (Poor) for 4 out of 5 Technical questions and was therefore excluded from the tender process. 3.9. The scores relative to the award criteria of the remaining Tenderers are noted below: Price (60.00%) Quality (40.00%) Total (100.00%) Buro Happold Limited 60.00% 33.70% 93.70% Elevate Everywhere Ltd 59.64% 26.00% 85.64% 3.10. Following the tender evaluation, the tender submission received from Buro Happold Limited is deemed to be the most economically advantageous tender. 3.11. To ensure the grant could be utilised within the required timescale, the Interim Corporate Procurement Manager approved the use of standing order 9.1(k) of Council Standing Orders Relating to Contracts which requires the retrospective reporting of the contract award to this Policy Board. The Call Off Contract was awarded by the Director of Environment, Housing and Infrastructure on 23 December 2024 in accordance with Standing Order 9.1(k) of Council Standing Orders Relating to Contracts 2024. 3.12. The approved contract value requires to include allowance for additional services that may be required from the Consultant during the Call Off Contract as part of the development of the OBCs cannot be fully defined at this stage. Such services may include building surveys and site investigations, and utility drawings mapping in view of any potential network pipe route options. It would not be cost efficient or an effective risk position for the Council to deliver additional related technical services required to develop the OBCs through a separately awarded contract or a different Consultant.
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3.13. Community Benefits were assessed at the Framework level, and Buro Happold Limited has confirmed the following Community Benefits will be available to the Council for this Contract. Community Benefit Description No of People / Activity Industry Awareness Event 1 Business advice/support to a local SME /Social Enterprise/ Voluntary organisation 1 Commitment to ensure that supply chain opportunities are prioritised for Renfrewshire based businesses 1 Non-financial support for a Social Enterprise or other approved community initiative 1 __________________________________________________________________ Implications of the Report 1. Financial – The costs of the Call Off Contract will be up to the approved contract value of £218,671.25 excluding VAT, and will be 50% funded from the Council’s LHEES, Public Protection and Roads budgets, and 50% funded from the grant secured from HNSU. 2. HR & Organisational Development – None directly arising from this report. 3. Community/Council Planning – • Place - Working together to enhance wellbeing across communities. • Economy - building an inclusive, green and resilient economy. • Fair - nurturing bright, happy and healthy futures for all. • Green - leading Renfrewshire to Net Zero. • Living Our Values - making a difference together. 4. Legal - The Procurement for this Call Off Contract was made following a further competition carried out in accordance with the procedures for Lot 4.1 Heat Networks – Heat Network Design of the Crown Commercial Services Demand Management and Renewable Framework reference RM6314. To ensure the grant could be utilised within the required timescale, the Interim Corporate Procurement Manager approved the use of standing order 9.1(k) of Council Standing Orders Relating to Contracts which requires the retrospective reporting of the contract award to this Policy Board.
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5. Property/Assets – There will be a requirement for Property services to replace boilers in the future. 6. Information Technology – Buro Happold Limited has confirmed that they have achieved Cyber Essential Accreditation. 7. Equality & Human Rights – None directly arising from the recommendations contained in this report. 8. Health & Safety – Buro Happold Limited’s Health and Safety policies and procedures were evaluated by Corporate Health and Safety and met the Council’s requirements regarding health and safety. 9. Procurement – The procurement procedures outlined within this report ensures that the Council meets its statutory requirements in respect of procurement procedures, efficiency and modern Government. To ensure the grant could be utilised within the required timescale, the Interim Corporate Procurement Manager approved the use of standing order 9.1(k) of Council Standing Orders Relating to Contracts which requires the retrospective reporting of the contract award to this Policy Board. 10. Risk - Buro Happold Limited’s insurances have been assessed and evaluated to confirm that they meet the requirements regarding insurance risk. The Consultant’s total liability to the Council is limited to a minimum of the levels of insurance to be maintained where insurance is required in accordance with the Call-off Contract and is limited to £1,000,000 in the annual aggregate for uninsured losses. The Consultant’s liability for matters which would be covered by professional indemnity insurance is therefore limited to £1,000,000 each and every claim. 11. Privacy Impact - Buro Happold Limited are required to enter into a Data Sharing Agreement in the form contained in the tender documents and as required by the conditions of contract prior to commencement of the services. 12. Cosla Policy Position – this work aligns with COSLA’s current work alongside the Scottish Government in response to the climate emergency. 13. Children’s Rights – This report does not cover a new policy, function or strategy nor a substantive change to an existing policy, function or strategy which will have an impact on children’s rights.
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14. Climate Risk – The level of impact associated with provision of these services have been assessed using the Scottish Government Sustainability Test and is considered low risk. This work and that of Renfrewshire’s LHEES aligns with Renfrewshire’s Plan for Net Zero, specifically the Clean Energy theme. _______________________________________________________ List of Background Papers - None Author: Louise Bishop, Procurement Adviser, louise.bishop@renfrewshire.gov.uk