Purpose

The Council has secured £3.47m through
the Warm Homes: Social Housing Fund Wave 3 to retrofit three tower
blocks by replacing their existing electric storage heaters with
ground source heat pumps and a shared ground array. We are now in a
position to appoint the main contractor for this work.

Content

That the Cabinet Member for Planning and
Housing:
 
1. Approves the award of the Warm Homes Wave 3 works
contract to the Kensa Group, to deliver the ground source heat pump
project to the Balmoral Estate and delegates to the Executive
Director for Environment and Place, authority to finalise details
of the contract.
 

Reasons for the decision

To progress the Warm Homes: Social Housing Fund Wave
3 project by appointing a main contractor based upon the result of
the related framework direct award process.

To facilitate the installation of up to 231 ground
source heat pumps in the three Balmoral tower blocks.

To reduce energy bills for council tenants and so
reduce the prevalence and impacts of fuel poverty in the
city.

To support the Council’s ongoing work towards
achieving its climate objectives by providing significantly more
efficient heating systems.

Delivery of the grant is on a rigid timeframe, with
grant spend being fixed per year and any unspent grant each year
having to be handed back to DESNZ. In addition to the need to
progress the project in a timely manner, the project requires a
Building Safety Act application to be submitted before starting
work inside the buildings, with these routinely taking upwards of 6
months to be decided. Tenders typically take a significant amount
of time to complete, so with a need to progress the project
quickly, it was decided that framework procurement would be the
option sought. However, only three providers were present on the
chosen framework, with one provider having a significantly lower
score, and of the two higher scores, one provider having since
entered administration. Therefore, it was decided that a direct
award to the remaining contractor would be the best route for the
project and would best allow us to meet the grant funding
timelines.
 

Alternative options considered

Not to make the award. This
would leave the council without a contractor to undertake the
required works and needing to return grant funding. This would
result in reputational damage to the Council and would damage its
ability to deliver on this and future retrofit projects. This in
turn would put at risk the council’s ability to deliver on
the upcoming 2030 Minimum Energy Efficiency Standards for social
housing. Additionally, residents in the Balmoral blocks would not
benefit from the expected reduction in their fuel bills resulting
from this project.