MD2482 EfLSC: establishment of a trading subsidiary

The Mayor’s ambition is for London to be zero carbon by 2050. The Mayor also wants the energy market to work better for Londoners by delivering fairer prices and helping them manage their energy use while making the best use of smart metering. While the market is not working well nationally, as acknowledged by recent Government interventions such as the Competition and Markets Authority (CMA) enquiry and the legislated price cap, London has particularly acute problems: ten per cent of Londoners are in fuel poverty; high levels of pre-payment meters (PPM); and relatively low levels of switching, installation of energy efficiency measures, smart meters, and solar panels.

Despite the recent national political interest in this sector, the problems persist. Ofgem’s most recent state of the market assessment (October 2018), found more than 60 per cent of people were typically paying about £320 more for their energy than customers on the cheapest fixed-term tariffs. It also found that 35 per cent of consumers earning less than £16,000 have never switched energy provider, compared to 30 per cent of other customers. Even since the introduction of the price cap at the start of 2019, there has still been a significant gap between the cheapest tariffs on the market and the price cap level, meaning savings can still be made by switching (Money Saving Expert reported in early May 2019 that savings of £300+ per year could be made below the price cap for a typical dual fuel customer).

Overall approach

The Mayor published the draft London Environment Strategy (August 2017) which set out that the GLA would tender for the delivery of an energy supply company. MD2187 (November 2017) approved the approach to work with an existing fully licensed energy supplier. This approach was subsequently confirmed in the final version of the London Environment Strategy (May 2018). Under such an approach (often known as a “white label”) the energy supplier is responsible for the supply and purchasing of energy, regulatory compliance and the risk related to these. The supplier will lead on marketing, customer acquisition and retention. However, as set out in MD2405 (February 2019), due to the extensive lead time involved in developing consumer branding and marketing collateral, the GLA is initially taking the lead on branding, customer awareness and pre-acquisition activities for launch while the supplier will handle marketing and customer acquisition activities after launch. After launch, GLA may choose to invest any surplus revenue generated by the subsidiary (from commission payments) into further efforts to support the supplier’s acquisition efforts. This will be discretionary and subject to further approvals.

Given the size of London, and the profile of the Mayor, the GLA has secured greater flexibility to set tariff structures and secure value-added services of benefit to Londoners than would be possible in traditional white label partnerships. As is typical with white label arrangements, the contracted energy supplier will pay the GLA subsidiary financial commission on a per customer basis, and the amount of commission was one of the aspects that bidders bid on. A separate MD will be proposed to address the Mayor’s manifesto commitment that after running costs, any surplus will be spent on delivering social and environmental goals.

Previous decisions have sought approval of expenditure on technical and legal expertise related to the procurement of an energy supplier (MD2187, November 2017; MD2319, July 2018); and branding, customer awareness and pre-acquisition activities for the launch of EfLSCo, to maximise its success at start-up (MD2405, February 2019). Note MD2319 foreshadowed that a subsidiary was likely to be needed; approval to establish this subsidiary is sought in this Decision.

Procurement process

In May 2018, the GLA issued a tender to procure a licensed energy supplier to deliver EfLSCo and void services. The tender documents were developed by a team of GLA officers, TfL commercial and legal, external legal experts, and energy retail and contract management specialists. The procurement, as guided by our procurement strategy, followed an OJEU compliant process. The competitive dialogue process was used to allow requirements to be fine-tuned in response to how the market responded to the tender. Dialogue was considered appropriate due to the ambitious nature of the arrangement, particularly given our challenging price benchmark and requirements for value-added services. The tender was issued as a framework agreement with two lots, lot 1 for EfLSCo services and lot 2 for void services. Void services will allow London boroughs and social housing providers to have a “one stop shop” type arrangement for energy supply to unoccupied properties and also means that the incoming tenant starts off being supplied by EfLSCo (but is free to switch in the usual way).

Following competitive dialogue, an invitation to submit best and final offers (IS-BaFO) was issued. The procurement process was overseen by an Evaluation Board, chaired by the interim Executive Director for Development, Enterprise and Environment. The Board have endorsed the outcome of the procurement process, as have TfL Governance. The winning bidder is Octopus Energy Limited.

This decision therefore seeks approval for entry into a contract with Octopus Energy Limited, for an initial 4 years, with the option exercisable by the new GLA subsidiary to extend for up to 4 years. For reasons outlined in the following section (see paragraphs 1.9 to 1.15), the contract will be entered into by a new GLA subsidiary. The contract will be in the form of a framework agreement which allows call-off of EfLSCo services and void services. The offer set against the Mayor’s objectives for EfLSCo (which were used to structure the tender) consists of:

Setting up a subsidiary

The arrangements concerning the receipt of commission and the spending of any surplus, amounts to “trading” by the GLA under the Local Government Act 2003. This brings the following legal requirements:

0. The GLA itself cannot enter into the contract with the energy supply company and may only do so by means of a GLA subsidiary company.[1]

2. The GLA (i.e. the Mayor) is required to prepare and formally approve a “business case” (a redacted version of which is annexed to this Part 1 Form) in support of the proposed exercise of its trading powers.

3. The “business case” is defined in legislation as “a comprehensive statement as to—

1. the objectives of the business;
2. the investment and other resources required to achieve those objectives;
3. any risks the business might face and how significant these risks are; and
4. the expected financial results of the business, together with any other relevant outcomes that the business is expected to achieve.”

These aspects are comprehensively covered in the attached Business Case (see next section and annexed Business Case. Note the attached version has had commercially confidential information redacted, the unredacted version is attached to Part 2).

4. The GLA must recover the costs of any accommodation, goods, services, staff or any other thing that it supplies to the subsidiary.

The Mayor is asked to approve the establishment of the subsidiary[2] – which would be a wholly owned subsidiary of GLA Holdings Limited (GLAH). The subsidiary will be a GLA managed company (i.e. a company that is fully integrated into GLA decision-making, as will be made clear in the company documentation) within the “Mayoral Decision Making in the GLA” framework [3]. GLAH approved this arrangement, subject to approval of this decision, at its Board meeting on 12 June. The Mayor is asked to approve the appointment of the following as subsidiary’s company directors who will meet at least quarterly to provide high level oversight and promote the success of the company:

• Mayor’s Chief of Staff: David Bellamy;
• Deputy Mayor for Environment and Energy: Shirley Rodrigues;
• Executive Director Development, Enterprise and Environment: Debbie Jackson; and,
• Assistant Director, Environment Unit: Luke Bruce.

It is also proposed that up to three non-executive directors be appointed to broaden the experience of the Board and their appointment will be subject to the resolution of GLAH as shareholder.

The GLAH Board will be asked to appoint a Representative to exercise its rights as sole shareholder at company meetings of the GLA subsidiary.

GLAH will be asked to approve the necessary Companies House and other company documentation (including the Articles of Association, which follow the form of GLA’s wholly owned fully integrated subsidiaries) required for the formation of the subsidiary.

The GLA Environment Unit will be responsible for the GLA’s day to day management of the subsidiary (and appropriate Environment Unit staff time will be charged to the subsidiary) and the contract with the supplier. There will be a Contract Manager within the Unit who will manage the contract on a day to day basis, reporting to the Assistant Director of Environment and the governance structure set out in paragraph 1.16.

The subsidiary will use GLA staff and facilities and will be charged for such use by the GLA. The subsidiary will receive the commission payments from the contracted energy supplier, which will be used to fund its running costs. Any surplus will be spent on delivering the Mayor’s social and environmental goals. Further advice will be provided on how best to spend this surplus in due course, noting that the amounts are unlikely to be material until the tax year 2020-2021, and will be subject to a future Mayoral decision.

Governance of the subsidiary and proposed staff delegations

As stated above, the day to day operation of the subsidiary will be managed by GLA staff within the Environment Unit who will devote a proportion of their time to managing the EfLSCo Contract with the supplier which the GLA will re-charge to the subsidiary. Given the profile, novelty and likelihood that there will be a range of issues arising, it is prudent to set up a two-tier governance structure beneath the Board of Directors involving:

1. A Mayor’s Chief of Staff chaired monthly Steering Committee (noting that this would meet twice a month for at least the first three months of the subsidiary’s operations) will take strategic decisions and provide guidance to the Working Group; and,
2. A monthly Executive Director chaired Working Group, comprising appropriate representatives from the Environment Unit, Marketing, TfL Commercial and the Contract Manager, which will review the day to day work of the Contract Manager and escalate decisions to the Steering Committee as necessary. This structure may be rationalised once working methods have been established.
3. Given the nature of the electricity and gas market, there will be operational decisions that need to be taken more quickly than allowed by this structure. For example, during competitive dialogue, bidders discussed that they might need to change tariffs quickly in response to events affecting wholesale prices, or develop a marketing campaign to respond to favourable conditions. We have therefore agreed in principle with the supplier the following approval timescales:

0. These timescales will be finalised as part of contract finalisation. Given these short timescales and that under the General Delegation only Senior Members of Staff are able to set fees and charges, the Mayor is specifically asked to delegate operational approval of the above decisions to:
1. The Contract Manager, sitting in the Environment Unit, where the tariff change is justified and within the benchmark (as set out in the table following paragraph 1.8); and
2. The Assistant Director of Environment, where these conditions are not met. In such cases, the Contract Manager would ask the energy supplier for justification (e.g. the Service Provider may want to set a tariff that is outside the benchmark, but justified on cost grounds, on the basis that the Service Level Agreement (SLA) standard is 90% and that the supplier believes that market conditions are such that it will soon be within the benchmark [i.e. market prices are generally moving upwards]).

Business Case

1. A business case is legally required to set up the subsidiary. A Business Case – following HM Treasury’s five case model and Green Book guidance – has been developed by GLA officers with advice from external consultants (Prosus Consulting) and independently reviewed by a separate specialist consultancy (Baringa). Baringa reviewed an interim draft, supported the overall conclusions, made some improvements to the estimates of costs and benefits, assessed the broader risks and made recommendations to mitigate them. The development of the Business Case and the Baringa Report have been overseen by a Steering Group chaired by the interim Executive Director for Development, Enterprise and Environment.
3. The Business Case concludes that the EfLSCo arrangement has the potential to bring a wide range of benefits to Londoners, both through direct financial benefits (i.e. energy bill savings) and indirect benefits such as simpler access to other GLA programmes and protection from hikes in energy price at the end of a contract. Similarly, the GLA can benefit both directly, through commission payments, and indirectly, through better targeting of programmes and broadening reach at lower cost. As many of these benefits cannot be quantified at this stage, our economic assessment has looked only at the direct quantifiable benefits and costs to consumers (bill savings and opportunity costs) and the direct quantifiable benefits and costs to the GLA (commission payments and running costs).
5. Within the business case we have developed a ‘baseline scenario’ and a series of sensitivity tests. [Detail removed post-approval as commercially sensitive]. Under this baseline scenario, the proposed EfLSCo arrangement provides a net benefit of £37.9m to £38.6m over the 4-year contract, made up of £34.4m consumer benefits (i.e. savings from switching) and £3.5m to £4.3m surplus revenue[4] to the GLA, which can be reinvested on delivering the Mayor’s social and environmental goals. These figures are net of the operational running costs for the GLA. However, it should also be noted that these figures do not incorporate expenditure related to set-up (including year 1 marketing budget), since this budget has already been approved by previous MDs and will not need to be repaid by the EfLSCo subsidiary. The net benefit figures calculated therefore reflect the actual surplus revenue which will be available for reinvesting on delivering the Mayor’s social and environmental goals.
7. In addition to our baseline scenario, we have modelled three alternative scenarios to test the sensitivity of likely benefits. The first sensitivity test investigates the impact of lower than expected customer acquisition. Under this scenario, EfLSCo acquires fewer than half the desired number of customers as in the baseline scenario ([Detail removed post-approval as commercially sensitive]). The second sensitivity test looks at the impact of reducing customer savings over time, to reflect the potential future impact of the price cap (which may act to reduce the saving between standard variable tariffs and the EfLSCo tariff, although to date there has been no evidence of this price convergence). The third combines sensitivity tests one and two, to show the impact of low acquisition and lower customer savings. The outputs of the baseline and sensitivity tests are outlined in Table 1.
9. Table 1 below shows, that even in the worst case, there is a net benefit to Londoners of over £8 million. Under the low uptake scenarios (sensitivity tests 1 and 3) there is a modelled loss to the GLA of £592,000 over 4 years. This loss will only occur if the GLA chooses to invest in activities to support customer acquisition (modelled at £250,000 per year)[5]; see paragraph 4.3 for detail on our assumptions around further expenditure and the reasons for the range in potential surplus/loss. This scenario is unlikely to occur; we would expect this marketing investment to generate higher rates of customer acquisition, and if it did not the GLA could reduce or eliminate marketing expenditure in future years to ensure the EfLSCo subsidiary does not run at a loss.

Table 1

Proposed next steps

1. The preferred bidder has been notified of their preferred bidder status. We will now begin final contract negotiations with this bidder. Following approval of this MD and finalisation of the contract, officers will notify the outcome to the unsuccessful bidders, observing the mandatory standstill period before entering into contract. The subsidiary will be set up in parallel. We will then work with the contracted supplier on detailed mobilisation plans, while progressing the branding and development of the marketing campaign and the launch plans. The GLA will be responsible for developing the EfLSCo branding and delivering an initial launch campaign. Following this, the responsibility for ongoing marketing and customer acquisition sits with the supplier.
3. In parallel to mobilisation we will continue to progress engagement with London Boroughs, Housing Associations and other key stakeholders. The aim is to secure their support in reaching their residents and most importantly those in fuel poverty, who are less likely to respond to the usual marketing channels.

The purpose of this project is to offer fairer energy tariffs for Londoners, especially those in fuel poverty, in line with the London Environment Strategy. The proposals will also contribute to the achievement of sustainable development in London and the UK. The more detailed objectives are set out in the table below paragraph 1.8. The contracted energy supplier will be subject to a suite of Service Level Agreements (SLAs) as part of the contract. It will report on performance against most, but not all of these, on a monthly basis and this will allow the Contract Manager to monitor and manage performance, escalating as necessary.

EfLSCo will lead to significant benefits and financial savings across London by:

• Saving around £200 off London’s fuel bills through an enduring lower-cost tariff, with fair prices guaranteed;
• Better support for vulnerable customers and those in fuel poverty and re-investment of surplus revenue into delivering the Mayor’s social and environmental goals;
• A gateway to other GLA programmes which may offer support for eligible households (e.g. Warmer Homes);
• Provision of innovative services to help customers gain greater control over their energy use;
• Increased competition in the London energy supply market. The introduction of a new supplier with competitively priced tariffs will contribute to overall market competition; and
• Increased switching rate. The marketing efforts around the EfLSCo launch will raise overall awareness of switching and is likely to increase to switching rate to all competitively priced suppliers.

Under section 149 of the Equality Act 2010, as public authorities, the Mayor and GLA are subject to a public-sector equality duty and must have ‘due regard’ to the need to (i) eliminate unlawful discrimination, harassment and victimisation; (ii) advance equality of opportunity between people who share a relevant protected characteristic and those who do not; and (iii) foster good relations between people who share a relevant protected characteristic and those who do not.

The public-sector equality duty requires the identification and evaluation of the likely potential impacts, both positive and negative, of the decision on those with protected characteristics. This may involve removing or minimising any disadvantage suffered by those who share a relevant protected characteristic and taking steps to meet the needs of such people. In certain circumstances compliance with the Act may involve treating people with a protected characteristic more favourably than those without it.

The GLA will take appropriate steps to identify any potential negative impacts expected on those with protected characteristics and to foster good relations between people who share a relevant protected characteristic and those who do not. It is likely that those with protected characteristics will gain from the positive benefits of this scheme in equal measure should they choose to switch to the proposed GLA supply company, and there will be equality of access to participate in the delivery and benefit from the scheme, without discrimination.

An equality assessment was conducted as part of the wider Energy for Londoners programme and the Mayor’s Fuel Poverty Action Plan and the principles of this apply here. Given the disproportionate impacts of high energy prices on the most vulnerable Londoners we expect there will be a positive effect, through this programme of activity, in tackling social and health inequality as well as improving awareness of energy use and the opportunities for people to reduce their energy consumption.

In parallel to pre-acquisition and awareness activities, engagement with those in or at risk of fuel poverty will primarily be done through direct borough channels, which we have identified to be more efficient. These include better data and targeting, referral and advice, home visits and other direct information for the most vulnerable.

Project costs

The project costs can be separated into set-up costs and ongoing running costs. Most set-up costs have been approved by previous MDs (MD2187, MD2319, MD2405). The only outstanding set-up cost, to be approved by this MD, is the cost of company set up on the GLA finance system. This MD therefore seeks approval for expenditure of up to £30,000 for company set up on the GLA finance system (SAP).

The anticipated running costs of the subsidiary are as follows:

* All staff costs are based on the mid-point of each grade and include costs such as pension and NI contributions.

**The G10 project manager role is an established post within DEE. The costs have been included here for completeness, but the G10 salary and desk charge would not be an expenditure for the subsidiary. This will also apply to 1.0 FTE of the GLA Support.

***Of this, costs for 1.2 FTE are included to cover GLA support time (HR, accounting, customer acquisition support).

In addition to these running costs, it is possible that the GLA may choose to invest in further efforts to support acquisition in years 2-4 to ensure our desired levels of customers are reached. The supplier is ultimately responsible for customer acquisition and will develop a marketing strategy to drive acquisition. To ensure desired customer uptake levels are achieved, the GLA may choose to support the supplier’s efforts by investing surplus revenue (or projected surplus) into ongoing marketing and engagement activities. By benchmarking against the expenditure of other small suppliers, we anticipate a budget of up to £250,000 a year may be appropriate for these supporting activities. This ongoing expenditure will be discretionary, and will be reviewed following the launch campaign to assess whether it is necessary and, if so, what level of spend is required. It is not possible to project the exact spend required to meet desired levels of customer acquisition at this stage; this will be dependent on the supplier’s marketing strategy and the exact impact of spend on acquisition, which will be evaluated following the year 1 campaign. When modelling potential EfLSCo subsidiary cashflow scenarios, we have therefore modelled two variants, one including expenditure to support customer acquisition and one without. This gives a range of costs (and therefore surplus), depending on the level of ongoing expenditure required. Any money invested will be taken from surplus revenue generated by the subsidiary.

The running costs will be covered by the income the subsidiary receives through commission payments. In order to establish the likely cashflow of the EfLSCo subsidiary we have modelled two scenarios:

1. Baseline scenario: [Detail removed post-approval as commercially sensitive]. We have modelled two variants of the baseline scenario: scenario 1A which does not include any ongoing marketing expenditure beyond year 1, and scenario 1B which includes £250,000 expenditure on marketing in years 2, 3 and 4; and,
2. Low uptake scenario: our low uptake scenario has much lower rates of customer acquisition ([Detail removed post-approval as commercially sensitive]). Again, we have modelled two variants, one without ongoing marketing expenditure (scenario 2A) and one with marketing expenditure of £250,000 per year in years 2-4 (scenario 2B).

The results show that under both scenarios 1A and 1B considerable surplus is generated, with the EfLSCo subsidiary breaking even in month 11 of the first year (see Table 2). Scenario 2A shows a small net surplus, with the EfLSCo subsidiary breaking even towards the end of year 4. Scenario 2B shows a loss to the GLA at the end of the 4-year period. However, as noted in paragraph 1.23, this scenario is unlikely to be realised, as the GLA could reduce or remove ongoing marketing expenditure if it is not yielding sufficient rates of customer uptake.

Table 2

Under all scenarios, the GLA does not make profit at the start of operation because expenditure is determined by the costs of managing the contract and income is determined by customer commission payments, which will be low until a customer base has been built up. The company will therefore run at a loss until commission payments exceed expenditure. The EfLSCo subsidiary will therefore require a loan from the GLA to cover this loss until it becomes profitable. This has been modelled as part of the Business Case, but how this turns out in practice is unknown given the novelty of this undertaking, which is why we have modelled different scenarios as mentioned in the previous paragraph. Under scenarios 1A and 1B, the maximum level of debt (and therefore loan required) for the EfLSCo subsidiary at any one point in time is £111,000. Under scenario 2A the maximum level of debt is £437,000 and under scenario 2B it is £906,000 (which falls in month 4 of year 4).

The project has an initial allocation of £4,000,000 approved for the set-up of EfLSCo. Of this, £2,390,000 has been allocated through formal approvals to cover procurement and set-up costs. We therefore have a total of £1,490,000 capital budget remaining from the EfLSCo project set-up budget, which is ringfenced within the Environment Unit’s budget. We therefore propose to call upon this budget to cover the EfLSCo subsidiary’s running costs until it is making profit. Under scenarios 1A, 1B and 2A this money can be paid back in full through commission payments by the end of year 4 (by month 11 of year 1 for scenarios 1A and 1B and by month 9 of year 4 for scenario 2A). In all scenarios, the maximum debt position is within the available budget remaining from set-up. Approval is therefore sought for GLA to make a loan of up to £906,000 to the subsidiary with the terms of the loan to be approved by the Executive Director of Resources.

Risks and issues

The risks relating to this request are due to the complex and novel nature of the project, the usual risks of managing external contracts and will be managed in accordance with GLA procedures. The risks and mitigation of these is set out below:

The £936,000 of funding set out in this decision form will ensure that the projected maximum operating loss of £906,000 arising from the worst scenario is adequately covered, after factoring in £30,000 of SAP set-up costs.

It should be noted that MD2187 and MD2319 approved spend of £250,000 and £790,000 respectively on other aspects of this initiative.

Financial due diligence was undertaken on the preferred supplier and was deemed satisfactory.

Any financial surplus created will be spent on delivering social and environmental goals in line with the not-for-profit arrangement.

The GLA’s principal purposes, under section 30 of the Greater London Authority Act 1999 and exercised by the Mayor, are promoting economic development and wealth creation, promoting social development, and promoting the improvement of the environment, all in Greater London. The GLA has power under section 30 of that Act to operate in the area of energy supply and related matters, on the basis that such operation is calculated to produce social and environmental benefits. Further, the Authority has a subsidiary power pursuant to section 34 of the Act which covers the procurement of support to provide assistance as described above.

The establishment of the subsidiary as a wholly owned GLAH subsidiary company limited by shares is calculated to promote and facilitate the above general social and environmental purposes and so is authorised by sections 30 and 34. Under the legal framework established under sections 95 and 96 of the Local Government Act 2003, as a best value authority the GLA is authorised by statutory orders to do for a commercial purpose anything which it is authorised to do for the purpose of carrying on any of its functions under section 30 of the GLA Act. This power covers the receipt of commission and the spending of any surplus from the contract with Octopus Energy Limited. Before doing so the Mayor must prepare a business case in support of the proposed exercise of that power; and approve that business case. The requirements of the business case are set out in paragraph 1.8 above. The requirements are addressed in this report and the business case as referenced below:

a) the objectives of the business:
• The objectives of the business are set out in paragraph 1.8 and in section 3.1.15 of the business case.

b) the investment and other resources required to achieve those objectives:
• The Table set out in paragraph 4.2 references the investment required as detailed in section 6 of the Business Case.

c) any risks the business might face and how significant these risks are:
• Paragraph 4.8 above references the Risks that are set out in section 4.4 and splits the risks in three categories i) risks to contract signature, ii) risks from contract signature, through mobilisation to launch, and iii) ongoing risks in operational phase.

d) the expected financial results of the business, together with any other relevant outcomes that the business is expected to achieve.
The expected financial results of the business are set out in paragraph in 4.5 above and in section 6 of the business case. The table in 4.5 above sets out four scenarios, the first two where the break-even point is in month 11, one scenario where the break-even point is month 9 of year 4 and the final scenario where the business will not break-even. Section 4 of the business case sets out the economic case which includes the benefits for consumers. The results of this are summarised Table 1 within the Executive Summary.

The Baringa report mentioned in paragraph 1.20 set out a number of recommendations relating to the terms and conditions. These have been addressed in the annex to the Business Case and have been agreed within the GLA as having been sufficiently addressed.

The foregoing sections of this report indicate that:

• the decisions requested of the Mayor (in accordance with the GLA’s Contracts and Funding Code) concern the exercise of the GLA’s general powers, falling within the GLA’s statutory powers to do such things considered to further or which are facilitative of, conducive or incidental to the promotion of economic development and wealth creation, social development or the promotion of the improvement of the environment in Greater London; and
• in formulating the proposals in respect of which a decision is sought officers have complied with the Authority’s related statutory duties to:

o pay due regard to the principle that there should be equality of opportunity for all people;
o consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom; and
o consult with appropriate bodies.

In taking the decisions requested, the Mayor must have due regard to the Public Sector Equality Duty; namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010 and to advance equality of opportunity and foster good relations between persons who share a relevant protected characteristic (race, disability, gender, age, sexual orientation, religion or belief, pregnancy and maternity and gender reassignment) and persons who do not share it (section 149 of the Equality Act 2010). To this end, the Mayor should have particular regard to section 3 (above) of this report.

Officers have indicated in paragraphs 1.6 – 1.8 of this report that the services in respect of which it is proposed that the framework agreement is to be established have been procured in accordance with the Public Contracts Regulations 2016 and in accordance with the GLA’s Contracts and Funding Code. Officers are reminded that in finalising the contract, amendments must be kept to a minimum and are limited to confirming financial commitments or other terms contained in the tender. Officers must ensure that appropriate contract documentation is put in place and executed by Octopus Energy Limited and the GLA before the commencement of the EfLSCo call-off services.