Issue details

Cabinet approved an Outline Business Case for the Cardiff Heat Network (CHN) on the 19^th April 2018.This decision authorised the further development of a Final Business Case for Cabinet approval subject to securing the appropriate funding.

In January 2020, the Council were successful in gaining Capital grant funding of £6.628m for the first phase of the CHN from Department of Business, Energy and Industrial Strategy (BEIS) Heat Network Investment Project (HNIP). An £8.6m interest free loan over 30 years has also been agreed with Welsh Government with repayments starting in 2025.

A tender process has commenced to secure contractors to Design, Build, Operate and Maintain the CHN. A special purpose vehicle  (SPV) will be needed to manage the network with funds being on-lent/on-granted from the Council to the SPV.

The Cabinet Report will present the final business case following the completion of the tender exercise, and will seek permission to establish the SPV and enter into contracts for the delivery and operation of the network. Subject to final prices received at tender, and to office level discussions, it may also propose a direct Council investment to cover any manageable funding gap needed to progress the project.