To present identified opportunities which will improve carbon reduction and energy saving measures at the Leisure centres, and to provide a recommendation for a preferred technology mix to move into delivery at both PFI sites ensuring optimum decarbonisation and / or energy cost saving.

RESOLVED to RECOMMEND to FULL COUNCIL:

1)     agree to the release of funds up to £530,000 from Growth Reserves to enable to the delivery of preferred technology mix (Option 2 of this report) to ensure improvements at both PFI sites for carbon reduction and / or energy cost saving.

2)     to delegate authority to accept the terms and conditions of any future grant funding secured to Executive Member for Health & Communities in consultation with the Assistant Director Contracts and Operations as officers continue to explore all external funding opportunities.

3)     That delegation be given to the Assistant Director Contracts and Operations and the Council Solicitor in consultation with the Executive Member for Property, Projects and Procurement to carry out negotiations with Parkwood Leisure and associated companies to obtain the best benchmarking outcome for the Council.

Option 2 (as outlined in Para 2.2 within the report) offers the largest mitigation in terms of revenue impact for capital investment made and provides a significant improvement in terms on annual carbon reduction.

Although option 3 (as outlined in Para 2.3 within the report) would see further annual cost savings and annual carbon reduction, the difference in both areas when compared to option 2 which would be gained from a significant uplift in capital expenditure does not lead to a recommended option.

As part of the PFI contract, a contractual benchmarking exercise is currently taking place which will result in an increase to the payment made to the leisure contractor in April 2024. The initial benchmarking figure, which would fall to the Council, received from leisure operator on 31^st May 2023 was £545,651. As identified in para 3.1 of the report, capital expenditure to fund the installation of these decarbonisation / energy saving technologies can be used as part of this process to mitigate against these costs as the leisure operator will benefit short to medium term from reduced energy consumption and therefore lesser utility costs.

Option 1 - To release funding to the value of £238,675 (£240,000) and proceed with delivery of 'Option 1' from report. This would see the following delivered at Thetford & Dereham. Installation of destratification fans (pool hall only), BMS optimisation works, lagging improvements. This option would see an estimated overall cost saving of £77,169 across both sites (Thetford = £20,270, Dereham = £56,899) and a reduction in total annual carbon emissions (TCO2e) from both centres would see an estimated overall annual carbon reduction of 105.06 tonnes across both sites (Thetford = 38.79, Dereham = 66.27) *

Option 2 - To release funding to the value of £528,524 (£530,000) and proceed with delivery of 'Option 2' from report.This would see the following delivered at Thetford & Dereham. Installation of destratification fans (whole centre), BMS optimisation works, lagging improvements, optimisation of heating systems. Thetford would also see replacement of single glazed windows. This option would see an estimated overall cost saving of £116,171 across both sites (Thetford = £51,322, Dereham = £64,849) and a reduction in total annual carbon emissions (TCO2e) from both centres would see an estimated overall annual carbon reduction of 175.55 tonnes across both sites (Thetford = 89.10, Dereham = 86.45) (Recommended)*

Option 3 - To release funding to the value of £1,016,215 (£1,020,000) and proceed with delivery of 'Option 3' from report. This would see the following delivered at Thetford & Dereham. Installation of destratification fans (pool hall only for Thetford, whole centre for Dereham), BMS optimisation works, lagging improvements, building fabric improvements, optimisation of heating systems. This option would see an estimated overall cost saving of £122,178 across both sites (Thetford = £54,127, Dereham = £68,051) and a reduction in total annual carbon emissions (TCO2e) from both centres would see an estimated overall annual carbon reduction of 190.38 tonnes across both sites (Thetford = 97.42, Dereham = 92.96) *

Option 4 - Do nothing.

*All option costings above are inclusive of design / project management fee estimates and contingency