Southampton catches some rays

10th May 2012


Southampton

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Southampton City Council has installed more than 700 solar panels to its buildings as it seeks to reduce energy costs and cut carbon

Karl Limbert, director for infrastructure and strategy, makes it clear that Southampton City Council is a progressive organisation and sustainability is high up on its agenda. “We want to lead by example in the community,” he says.

His statement is backed up in practice by the range of sustainable technology projects the council has initiated to generate renewable energy, reduce CO2 emissions and save money on fuel bills.

Southampton was, for example, the first council in the country to develop an industrial-scale geothermal plant, in 1986, and, together with energy produced by the local authority’s CHP (combined heat and power) scheme, around 40 buildings now benefit from this form of renewable technology.

More than a quarter of Southampton’s 80-plus schools tap into some form of renewable energy and the council will soon be leading the way by powering every street light in its communities through energy-saving LED lighting.

Here comes the sun

The council’s most recent sustainable technology project involved the roll-out of solar photovoltaic (PV) panels on schools and other council-owned buildings across the city, including the civic centre, a grade II listed building.

The project has been a great success, but has not been without significant challenges – the main one being the uncertainty surrounding the government’s feed-in tariff (FIT) scheme and the sudden bringing forward of the deadline for registration under the FIT (see panel, below).

This meant that the council and its solar supplier had to move project milestones at the last minute and there was a race against the clock to install the solar panels before the new 3 March deadline to receive the higher tariff rate for the next 25 years.

Although the FIT scheme was a key impetus for the council’s solar PV ambitions, it was not the only one. Southampton City Council had already embraced the former Labour government’s sustainable schools initiative and, from 2009, seven schools under the local authority’s control were fitted with solar panels as part of the Low Carbon Buildings Programme. The FIT scheme was viewed by the council as an opportunity to extend solar PV technology on a wider basis across the city.

The council was clear from the start that it did not want to be involved in any “rent-a-roof” schemes, whereby the installation company typically pays for the panels to be fitted and maintained, and the connection charges – and picks up the FITs and any income generated from exporting electricity to the national grid.

As Limbert says: “The council wanted to be the investor and we felt we were able to manage the technical and financial risks involved in procuring and installing the panels in time to receive the FITs.”

Scoping the project

A dedicated team – led by Ian Davies, project manager, energy and heating – started scoping out the solar PV venture in early 2011, deliberately spending a great deal of time on this early research phase, to ensure that the later procurement and installation phases ran smoothly.

Limbert says that it is the type of resources, rather than the number, that is crucial to running this type of project effectively. In addition to having an experienced project manager to lead, the team worked closely with its existing external strategic partner, Capita, on most of the technical aspects of the project, as well as key council functions, such as planning, legal and procurement.

The initial phase included undertaking feasibility studies to identify suitable buildings for solar PV installation. The council and Capita worked together to carry out detailed structural surveys of the roofs and a range of other pre-installation work, including orientation of the roof to the sun, and mechanical and electrical, health and safety, and asbestos-related surveys.

Accurate studies had to be completed on how much additional weight each roof could potentially withstand – for example, if it snowed – and a number of other elements also had to be factored in, such as the effect of the wind on a roof fitted with solar panels.

A number of schools and housing blocks were eliminated from the programme at this early stage, although some buildings were included until very late in the project plan and a decision taken at the 11th hour to remove them from the programme.

For example, the adaptations needed for one school would have been too extensive to justify fitting the panels. And on one housing block the roof would have needed replacing in five years, rendering it unsuitable for this particular programme.

The final portfolio of buildings was deliberately diverse and covered eight schools, one housing block and the civic centre.

Procuring a supplier

Seventy-four requests for prequalification questionnaires were received by the council from companies showing an interest in tendering for the contract to be its solar supplier. Thirty-four were completed and the council whittled these companies down further to a short list of five, measured against the following three key criteria:

  • price – overall cost of installation and maintenance;
  • programme – the completion of the installation was timebound, given the changes to the FIT scheme and the cut-off dates for registration; and
  • quality – the performance and efficiency of the solar panels.

Both Limbert and Davies were familiar with the renewable-technology field, but they had to very quickly acquire, alongside their technical partner Capita, a detailed understanding of the solar PV market and the different types of panel on offer – and their expected yield – to make informed decisions about the third criterion on the procurement list.

The quality and cost of panels cover a wide spectrum, they discovered. The council started the procurement process in July 2011 and, even though it followed an accelerated procurement process in line with EU legislation, the contract winner, Solarcentury, was not announced until November 2011.

Just before this decision, however, the government announced that the FITs cut-off date would be brought forward to 11 December 2011. This meant that the council had to renegotiate the terms of the contract at a crucial point in the procurement process. Inevitably, some potential suppliers could not meet the revised, shorter timescale for fitting the panels and had to drop out.

Installation: the “easy” bit

Davies says that the work to install the solar panels began “before the ink was dry on the contracts” and, compared with the lengthy planning and procurement processes, the installation itself was relatively quick and straightforward.

The work on four schools was completed within four weeks (before the 12 December deadline), for example, and the fitting of the panels on a secondary school was deliberately arranged to coincide with a school holiday so as to cause minimum disruption.

Fitting solar panels to the civic centre, a grade II listed building, which opened in 1932, was more complex. But even in this case the complications were more with the planning side of the project than with the installation itself. The technical aspects of the work were not that different to fitting panels on a flat school roof, says Davies. The building had 24kWp (peak) PV panels fitted – or 130 panels at 190-watt electricity load each.

“It was always the council’s desire to try and fit the civic centre with solar PV if possible – situated in the middle of the city, the building is an important landmark for the council and a very visible example of its commitment to sustainable technology,” says Limbert.

Although the installation phase of the solar panels is complete, the work on the project is far from over and won’t be for the next quarter of a century. The next stage, which involves setting up the monitoring and data systems to record the amount of solar energy produced, has already started.

Recording the yield from the panels and submitting quarterly readings is a prerequisite for receiving the feed-in tariff revenue from the government. This will be taken care of in-house by the council.

The return on investment

The cost of fitting solar panels to all the sites was estimated at around £700,000, although the council has not spent the full amount yet, given that the programme was subject to some turbulence, not least because of the unexpected changes to the FIT scheme.

To date, 730 solar PV panels (172kWp) were fitted during this installation programme, which is projected to save more than 100 tonnes of CO2 and generate FIT and export payments in excess of £55,000 each year – £1.4 million over the next quarter of a century. This income will be in addition to savings of more than £800,000 in energy costs alone over the next 25 years. This is well worth the investment, says Limbert.

“We need security of energy supply and that means moving away from reliance on fossil fuels, so this is a long-term strategy – the cost of not doing anything to develop renewable energy sources is much greater than our investment on this project,” he comments.

The most significant challenge for the council on its solar PV project was, undoubtedly, the government continually moving the goalposts when it came to the cut-off dates for the FITs.

The period where the council had already produced draft contracts and then had to renegotiate them was, says Limbert, “ridiculously difficult – you can’t run a project effectively when the rules change halfway through, and it meant that the companies weren’t bidding for the contract that they thought they were.”

In his view, the strict rules governing public sector procurement also need to be taken into account in schemes like this, and sufficient time allowed for public sector organisations to plan and see any projects through to completion.

One of the key learning points for other organisations planning a similar project is to spend a lot of time upfront scoping out the work and evaluating the pros and cons of different courses of action, says Davies.

“We invested a lot of time and money in carrying out the preparatory work – but we were very glad we did as it saved us a lot more time and money further down the line,” adds Limbert.

The current project at Southampton City Council is now complete, and considered a success, although the authority’s future plans for solar PV will depend partly on what happens to the FIT scheme.

The council’s renewable-energy plans do not rely solely on solar PV, however, and it already has plans to develop other sustainable technologies for its offices and communities.


Feed-in Tariff

Introduced in April 2010, the government’s feed-in tariff (FIT) scheme aims to encourage deployment of small-scale (less than 5MW) low-carbon electricity generation. Homeowners and businesses can be paid a FIT for both the generation of electricity and for supplying unused generated electricity back to the national grid.

The FIT scheme was a key impetus for Southampton City Council’s solar PV installations, but, less than a year into the scheme, the government announced that support for larger-scale PV installations (over 50kW) would be reduced.

Then, in October 2011, DECC proposed further cuts of 32%–55% to the incentives for installations over 250kW, effective from 12 December 2011. However, campaign group Friends of the Earth and two solar companies (Solarcentury and HomeSun) mounted a successful legal challenge to the timing of the cuts, which would have come into effect before the end of the government’s consultation.

Before DECC’s announcement, it was believed that any changes to the rate of FITs would only apply on or after 1 April 2012. Although the High Court judgment – affirmed by the Supreme Court – meant that the government could not make the change effective from 12 December, the cut-off date for organisations to receive the higher tariff for the full 25 years was moved to 3 March 2012.

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