Development & Funding Partner to develop the Birkenhead Heat Network

Description

The project comprises development of a new heat network serving a mix of buildings including new build residential, existing residential, new build commercial and existing commercial. The project forms an integral part of Birkenhead 2040 Regeneration Framework; one of the biggest brownfield redevelopment sites in the UK. This regeneration of Birkenhead will take place across nine areas providing 21,000 new homes and almost 1,000,000m2 square metres of employment space over the next 20 years. The area to be served by the network has been identified as a 'priority district heating zone' in Wirral's Local Plan. It will make a significant contribution to reducing the carbon impact of new / existing development in the Borough and provide opportunities to residents and businesses for lower cost heating. The project is well-aligned with regional policy objectives and initiatives. It also fits into the Government's introduction of 'heat network zoning', which, through implementation, will mandate certain types of buildings in identified urban areas such as Birkenhead to connect to district heating within a prescribed timeframe. It is envisaged that, once heat networking zoning is in place, the Birkenhead Heat Network could benefit from zoning 'incumbency' rules - meaning that nearby eligible buildings will be mandated to connect, further securing demand. The network is intended to supply heat to: New Build Residential buildings Existing Residential buildings New Build Commercial buildings Existing Commercial buildings The project will be delivered through Wirral Council procuring a Development Partner. The Council and Development Partner will enter into a Development Agreement under which the Development Partner will further develop its proposals for the heat network. The Development Agreement will set out a number of gateways which the project must pass through in order to proceed. If the project proceeds beyond the development period, the Council and Development Partner will become shareholders in the ESCo albeit that the Council's shareholding will be limited to a "Golden Share". The ESCo will be the supplier of heat to a number of public and private sector bodies (including the Council) under separate heat connection and supply agreements. The Council will not be investing in the project, the Golden Share will simply allow the Council to exercise control in relation to a limited number of reserved matters including carbon intensity, reporting and tariffs. The ESCo will be required to source all capital funding for the project. The ESCo partner will be appointed in perpetuity.