Decision details

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.

Summary of Decision

The Cabinet Member for Finance and Council Reform has approved: 

1. 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. 

2. 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.   

3. 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.