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It is worth noting this is a completely separate project from the PCC 'Cereste' solar farms currently proposed. This scheme was however, was the first identified by the Peterborough City Council to kickstart its renewable generation agenda, and was the subject of a Cabinet decision on 13th June 2011.
The Council was seeking a 1.5MW installation on the TESAM warehouse roof.. This would have been achieved in the relevant timescales for accreditation, save for the Department of Energy and Climate
Change (DECC) making a unilateral reduction in the feed in tariff associated with installations
of that size. Council members may recall that this swift action by DECC was due to the
by the Government under the FiT regime unsustainable in the long term.
The strategy the Council adopted was to build out as much solar PV on the TESAM rooftop
as was possible at the higher rates until the cut off date.
What was the actual cost? £946,684:00
Total amount invoiced to date by the contractor (including the additional seagull prevention
and electrical modification works) is £946,684:00.
Was the finance borrowed and if so at what rate of interest?
borrowing approach was applied to this project.
Was the interest rate fixed and over what period?
Peterbrough City Council typically borrows over 25 years. Currently all loans are at fixed rates (as reported
to Audit Committee recently in the Treasury Management update).
What is the yearly amount that has to be paid back to include interest and repayment
Annual costs of interest and repayment on £947k at 4.3% is £62k per annum
What is the exact rate of income, over and above all costs, now being produced per
As PV panels are at their optimum output when new, they will deteriorate on a gradual basis
over the life of the installation.
interest on the loan and maintenance will increase?
notified to Group Leaders in the near future. Chris York suggests that he has seen the figures but following legal advice, he is not currently in a position to disclose the information.
interest and repayment costs are fixed each year (based on the fixed interest rate and
the annuity method of repayment) and do not increase
maintenance and insurance costs are indexed linked
Panel performance does deteriorate, and an industry standard degradation rate has
been used in all of our projections and financial models
Income from FiT and sales is indexed linked and increases
As such the surplus raised fluctuates year on year. For a 206kW scheme, this ranges from a small
deficit in the early years, through to a predicted surplus in the majority of years.
Overall, the forecasts indicate that there should be net income to the Council over the 25
years, after all costs, including build costs have been taken off.
It was reported at the time that Mears would be given the contract for the
installation. If this is correct, did Mears sub-contract the work and if so who to?
It was not reported that Mears would be given the contract. Mears were not involved in the
Freemans Building (Tesam). Enterprise were procured under an OJEU and acted as Main
Contractor with works packages subcontracted to Applied Sustainable Energy where
It is important to note that as from Dec 12th 2011 the feed in tariff rates dropped from 15p to 12.9p. This came into effect for all installations completed by midnight 12th Dec 2011.
Installations completed after the 12th Dec 2011 were paid at the rate of 15p until the 1st April
2012 when it reduced to 12.9p. The export rate was 3.1p, the Fit and export rates are RIP
linked approx 2% per year. Although the income increases over the duration of the Fit
between 20-25 years.
Example Financials (approx calculation)
Total Revenue per year £26,010
could generate an additional £6,750 per year
Approx Income £32,760 per year
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