Heat Network Utility Surverys

Following the 2018 publication of the Mayors ‘London Environment Strategy and Zero Carbon London: A 1.5oC Compatible Plan’ and changes to London’s Net Zero target from 2050 to 2030, OPDC is establishing the feasibility of delivering of a District Heating Network to contribute to decarbonisation initiatives. District Heating is forecasted as one of the four decarbonisation pathways, with the potential to supply almost 6TWh or 15-25% of London’s heat demand.

In the last two years, OPDC has received planning applications for five new Data Centres. Data Centres are significant users of power which generate high levels of waste heat. As these Data Centres are located close to customers, OPDC is currently exploring the option of offsetting the waste heat from Data Centres to meet local customers heating, cooling and hot water demands, via the use of a heat network.

An Outline Business Case (OBC) which detailed the viability of delivering a district heating network, received approval from OPDC’s Development, Investment and Sustainability Committee (DISCo) on 22 February 2023.

Following approval of the OBC by the DISCo, OPDC were successful in their application to the Department for Energy Security and Net Zero (DESNZ) from the Green Heat Network Fund (GHNF) for amount of £36m.

OPDC will begin the ‘commercialisation’ phase of the project to find a funder and delivery partner to develop a District Heating Network within the OPDC Area.(the Project) The current aim is for construction of the Project to begin in 2025.

To support commercialisation OPDC need to organise utility surveys to assess the viability of proposed pipework routes provided by OPDC’s lead technical consults, Aecom Limited (Aecom).

The rationale behind proposing an external survey platform instead of the robust frameworks already in place arises from a necessity to target core GLA objectives, which include supporting smaller businesses and diverse – owned suppliers.

RenKap is an online platform which allows clients to upload site information and connect with UK vetted suppliers for the purposes of survey tender, procurement, instruction, and management. This is all done through the platform’s website, offering a single point of call and a RICS/British Standard compliant list of suppliers, who might typically struggle in a competitive procurement process.

As a direct portal to SME’s, RenKap has the benefit of competitive pricing. While smaller organisations may not possess the prestige and status of larger contractors, they often directly manage workstreams themselves with a smaller pool of employees that are likely to be focusing on projects on an individual basis, rather than managing multiple at the same time. This has been reflected in RenKap’s recent quote, where our preferred subcontractor, The Survey House has priced lower than larger organisations. Additionally, RenKap may add value across the wider OPDC Team as it can be managed by up to five accounts and used to commission multiple surveys across different internal departments.

RenKap was appointed to the GLA’s framework and procured to assist in the GLA’s ‘Small Sites Small Builders’ grant funding programme to help public landowners undertake relevant survey work on their sites, which has given rise to another consideration, Lord Kerslake’s review of GLA Group housing delivery which called for more engagement throughout the GLA Family. Use of an already implemented GLA framework supplier is an opportunity to increase collaboration with GLA initiatives.

Value for money is achieved through RenKap’s platform by providing access to SME’s that tend to provide better value for money over major national corporations who typically tender through TfL frameworks.

Relevant Decision History

In March 2023, the OPDC Board delegated authority to the Chief Executive Officer to draw down and spend up to £2.3m on the commercialisation work programme.

The commercialisation budget was subsequently set out and approved in CD194.

CD194 has allocated a spend of £255k towards the delivery of Surveys and any associated third party costs which this decision seeks to draw on for the completion of Ground Penetrating Radar (GPR) and Topographical surveys. Please see the Finance comments outlined in section eight below for a detailed breakdown of planned funding for this Project. Additionally, CD194 is also referenced below under ‘Other supporting papers’ which provides a detailed overview for OPDC’s overarching commercialisation budget.

As these surveys will provide details that will inform the Project’s design as part of commercialisation, this decision seeks funding approval from OPDC’s Chief Executive Officer above the standard £150,000 allowance, as delegated by OPDC Board in March 2023.

The expenditure will pay for the costs of GPR and Topographical surveys on roads from Central Way to Old Oak Common Lane and the surround area of West London, from the postal codes of NW10 6HH to NW10 6ED. The size of the survey area is approximately 105,930 m2 . The survey works will be carried out by the appointed subcontractor.

To support these surveys and engage the commercialisation stage of the Old Oak Park Royal Energy Network (OPEN), it is necessary to undertake a competitive procurement process to determine an appropriate subcontractor. Neither OPDC nor its multi-disciplinary consultant team have the accreditation and skill-set required to conduct these surveys independently, therefore external assistance is required.

This decision form is seeking to involve the use of RenKap’s platform which offers in-house management of procurement via their website. Due to the complexity of the sites in question, the RenKap team will reach out to their list of PreQualification Questionnaire (PQQ) and accredited suppliers individually, based on specifications and drawings from the OPDC and Aecom teams. Once the appropriate information has been provided to RenKap, a quotation and tender report which lists three suppliers will be submitted to OPDC for evaluation of preferred bidders.

Following evaluation and approval of a preferred bidder, OPDC will then engage local authorities to organise road closures with the relevant Boroughs under which each survey area falls. Once council approval has been received, contractors can be instructed in advance to conduct survey works.

The primary objective of this proposal is to gather GPR and topographical road survey data which will ensure accuracy in design work and that potential pipework routes are viable and do not overlap with existing under-surface utilities.

As these surveys form part of OPDCs District Heating Network design, their results will assist in the development of a project meeting the overarching GHNF objectives as follows:

• achieve carbon savings and decreases in carbon intensity of heat supplied.
• increase the total amount of low carbon heat utilisation in heat networks (both retrofitted and new heat networks).
• contribute towards market transformations across the investment landscape and supply chain that will better prepare the heat network sector for further decarbonisation.

This proposal will assist in the delivery of OPDC’s District Heating Network which will deliver the following wider benefits:

• reduce overall savings in the cost to meet zero carbon planning requirements.
• reduced costs of heating and hot water to local consumers.
• significant reductions in carbon emissions contributing to a sustainable environment.

OPDC is a Mayoral Development Corporation which strives to achieve targets and strategies set by the Mayor of London to the highest standard. The surveys outlined will help with assessing the viability of suggested pipework locations for a District Heating Network, which supplies waste heat from data centres to local consumers across OPDC’s West London development. These assessments will in turn help OPDC progress with its OPEN programme schedule and net zero targets by 2030, in line with the 2018 ‘London Environment Strategy and Zero Carbon London: A 1.5oC Compatible Plan’.

Lord Kerslake conducted a review of the GLA Group housing delivery and noted that current GLA organisational structures are not geared towards collaboration. This proposal seeks to address the priorities suggested in the report via the use of an existing GLA initiative for site surveys known as RenKap. As the platform’s license has already been procured under the GLA’s framework, this proposal presents an opportunity for OPDC to explore GLA family resources as an alternative to its standard procurement process. Successful implementation of this platform for the required surveys may also have wider benefits and drive other GLA family bodies to exchange ideas and share expertise. The GLA have also displayed a keen interest to collaborate/engage OPDC with RenKap’s platform and have agreed to fund the £6,000 cost of OPDC licensing the programme for a year.

The below shows the organisational contractual structure during procurement:

• GLA (Funder)
• DESNZ (Funder)
• OPDC (Client)
• TfL (Procurement Lead)
• RenKap (Client Agent/ Site Survey Managers, Tender Officer)
• Principal Subcontractor (The Survey House)

Procurement commencement has followed completion of a Procurement Pipeline Submission Form, issued to TfL’s Collaborative Procurement Team (CPT). This ensured that the scope and nature of the procurement activity is captured for awareness, planning and audit purposes.

RenKap will run a mini-tender process manually via its platform based on OPDC’s survey requirements and supplementary information provided by Aecom. Renkap will vet bidders to ascertain that each supplier put forward passes core PQQ and service specific PQQs for each service they offer, supplier responses will then be collated and drawn up into a tender report containing at least three quotations.

Following submission of the tender report, OPDC will select an appropriate sub-contractor to carry GPR and topographical survey works as required.

To ensure compliance with requirements of local authorities who own the proposed survey land, OPDC will make site-access arrangements with landowners regarding any traffic management and road closures as required. The London Boroughs of Ealing and Brent have already been informed of OPDC’s planned surveys in May of this year and OPDC will continue to update councils as and when necessary.

The below shows how OPDC is organised to deliver the works:

• Executive Delivery Director (SRO/ SMT Lead)
• Director of Special Projects (Project Oversight)
• Senior Project Manager (Programme and delivery lead, budget holder and overall responsibility of the project)

Risks and issues

All risks in the above table have been reviewed in line with OPDC’s Risk Management Framework.

Under Section 149 of the Equality Act 2010, as a public authority, OPDC must have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and victimisation as well as to the need to advance equality of opportunity and foster good relations between people who share a protected characteristic and those who do not.

There is a negligible risk of this proposal having an adverse impact on protected groups, GPR and topographical surveys will assist in the feasibility, design and development of a District Heating Network that aims to benefit residents and businesses in the OPDC area, this heat network will benefit all Londoners in the creation of a green and sustainable environment in line with the Mayors Net Zero 20230 target.

This procurement will deliver on the GLA Group Responsible Procurement Policy Our preferred bidder, The Survey House is an SME which might typically face barriers to market entry. Through procuring The Survey House, OPDC reinforces it’s commitment to facilitate fair and equal opportunities for smaller business in London and add social value through supplier chain diversity. As a member of the GLA Group, which forms part of the London Anchor Institutions Network (LAIN), OPDC wishes to align with the Mayor’s vison and objectives and also support diverse and underrepresented organisations.

Consultations and impact assessments

Local boroughs falling under the survey area will undertake impact assessments of the requested road / lane closure.

OPDC will work closely with its Communications Team to ensure members of the public are informed of planned survey works, this will form part of ongoing discussions with local authorities to mitigate the impact of road closures on local residents and businesses.

Health in all policies

The subcontractor is responsible for all health and safety on-site and complying with all site access and landowner requirements when undertaking the survey.

Data protection

All events and project activities will adhere to the appropriate GDPR regulation. supplier chain diversity. 

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No one involved in the preparation or clearance of this form, or its substantive proposal, has any conflict of interest.

It is proposed that this contract will be funded through the £75,000 in the Heat Network budget line in the Delivery Team budget. The remaining £198,148.34 outlined in this decision form will be funded from the third Party Costs budget line within the Commercialisation Budget. There are no further financial implications arising from this report.

The foregoing sections of this report indicate that the decisions requested of the Chief Executive Officer concern the exercise of the OPDC’s general powers, falling within the OPDC’s statutory powers to do such things considered to further or that are facilitative of, or conductive or incidental to, the promotion of economic development and wealth creation, social development or improvement of the environment, in Greater London.

In implementing the proposals in respect of which a decision is sought, officers should comply with the OPDC’s related statutory duties to:

• pay due regard to the principle that there should be equality of opportunity for all people
• 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
• consult with appropriate bodies.

In taking the decisions requested, as noted in section 6 above, the Chief Executive Officer must have due regard to the Public Sector Equality Duty under section 149 of the Equality Act 2010, namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010; to advance equality of opportunity between persons who share a relevant protected characteristic (race, disability, gender, age, sex, sexual orientation, religion or belief, pregnancy and maternity, and gender reassignment) and persons who do not share it; and to foster good relations between persons who share a relevant protected characteristic and persons who do not share it. To this end, the Chief Executive Officer should have particular regard to section 6 (above) of this report.

Section 1 of this report indicates that part of the sought budget will amount to the provision of grant funding. Officers must ensure that the funding is distributed fairly; transparently; in accordance with the OPDC’s equality policy and subsidy control rules; and in a manner that affords value for money in accordance with the OPDC Contracts and Funding Code. Officers must ensure that an appropriate funding agreement is put in place and executed by the OPDC and the recipient before any commitment to funding is made.

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Delivery Director Update