Solar Briefing Note for Local Authorities on Procurement

8/6/2019 Solar Briefing Note for Local Authorities on Procurement

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Q&A for Local Authorities

Questions/Comments Answer

For clarity, schools need landlord permission to

install this type of kit and as the buildings are not

owned by schools but managed.

The premises used by a particular school may or

may not belong to the council and the school

may or may not have been given rights to allow

use of the building by third parties. This will

depend on a case-by-case basis.

It could in the worse case scenario result in

enforcement action to remove the equipment.

Understood, and it is why we have insisted that

all permissions are in place before an installation

can go ahead.

In terms of the equipment, this is not materially

different to the situation that exists with, for

example, existing electricity meters which are

owned by the electricity company and which the

electricity company has access rights under the

terms of its contracts, something landlords are

comfortable with.

Who is the Designer, Principle Contractor? Avonside Renewables which is a subsidiary of

Avonside Group Services (one of the biggest

roofing and renewables groups in the country

who have carried out a considerable amount of

school-related work in the past).

Is it notifiable under Construction Design and

Management regs 2007, the CDMC?

The contract size brings these installations

below the threshold where the CDMC

regulations apply but having said this, Avonside

intend to proceed as if they did apply from the

point of view of best practice including

preparation of a school-specific Health & Safety

Plan, to be shared in advance with each school.

Will the Head teacher be the Client in this case

and not the County Council?

The CDMC regs do not apply for the purposes of

defining who is the Client. This said, the client of

the contractor is the owner of the equipment,

being the investment fund paying for it. Forpractical liaison purposes the school head will,

however, be treated as the main contact.

Who assesses the risk assessments and method

statements for the principle contractor?

Although the CDMC regs do not apply,

nevertheless Avonside will be preparing a risk

assessment during site visits and which will be

provided to the school prior to installation.

Note also that the investors and banking group

funding the installations are very cautious and

require an independent Technical Adviser to vet

all aspects of the work being performed by the

installer including this aspect (the requirement

for which is included as a contractualrequirement in the terms of their appointment)


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What procurement regime has been undertakenfor the appointment of the principle contractor?

Proposals were invited from six contractors andthe selection made on the advice of the

sponsors engineering adviser.

Schools are subject to public procurement rules

and must abide by them as any public

organisation should. If not then they could be

open to challenge from competitors in this

competitive market. Is it necessary to comply with

OJEU?

No because neither the school nor the local

authority is procuring anything: no payment is

being made or financial liability incurred by

either. However, were this to be the case, the

contract size would in any case come below the

de minimis threshold. This has been confirmed

by the sponsors legal advisers.

What competency checks have been undertaken

for the principle contractor and designer?

Avonside Group Services is one of the biggest

groups of its kind in the country. Avonside

Renewables is MCS registered for the purposesof the installation of microgeneration including

solar PV

What liability does the Head have with regard to

management of installation works?

None provided he/she allows access for

installation in accordance with the Terms and

Conditions.

Are risk assessments undertaken for the residual

risks associated with maintenance and servicing

of plant and equipment for the future workforce, ie

working at height edge protection etc?

Yes: O&M is also to be carried out by Avonside

Renewables under a long-term contract (25

years) - the investor group is particularly

concerned to ensure this is the case.

Note that O&M will differ from installation in that

during installation edge barriers will be in placewhereas for maintenance man-anchors will be

used.

What risks (if any) are associated with the

equipment on roofs?

All risks are assumed by the owner, although the

school must not permit unauthorised persons to

access to the PV panels. The owner, the school

and indeed the local authority will be included as

additional insured parties under the global

insurance policies being put in place by the

lenders and investors in support of the financing

of the installations. These include loss through

damage to the equipment, property, third party

cover, and personal liability to name a fewfeatures.

Please provide details of all trades associated

with the installation and if accredited to any trade

body, ie Electricians to NICEIC/ECA etc

Avonside has sub-contracted WT Parker, a

leading national electrical company, to proceed

with provision of electrical services.

Is it possible to negotiate changes to the Terms &

Conditions?

Unfortunately not: this is a portfolio financing

and this requires the contract terms for each

school to be identical or the school cannot be

included. This is in part why the Terms &

Conditions effectively impose most of the

responsibilities and all of the liabilities on the

funders where possible.


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What safeguards are in place to ensure thecompany offering the scheme and their

subcontractors are suitably qualified and

accredited to undertake the work in terms of their

technical capabilities, health and safety, CRB

checks, asbestos awareness training,

assessment of structural integrity of roofs, roof

condition and replacement intervals expected

etc?

Avonside is a major national roofing companywith MCS qualified experts and CRB qualified

team leaders. They have done extensive work in

schools in the past and this has been a pre-

condition to their selection. Screening of

schools suitability for inclusion in the

programme is being carried out based on an

assessment of roof condition by experienced

roof installation experts together with qualified

structural engineers. The quality of their work

will be reviewed and assessed by a leading

international engineering consultancy on behalf

of the funding entities as a condition of

proceeding.

Do the investors plan to combine the Feed in

Tariffs (FITs) with any other form of public funding

support (eg councils loans/guarantees, grants

etc)?

Advice from Ofgem (the industry regulator)

indicates that programmes receiving other public

funding support in whatever form will not be

eligible for FITs since the EU prohibits

combination of different sources of state aid and

council loans/finance/guarantees are considered

to be state aid.

The sales pitch appears to be designed to rush

schools into making a major decision in a month.

In addition once the school has signed they

appear to be locked in for 25 years.

We are not looking to rush schools and the

programme timetable has been extended to the

end of the summer term. However, places

available in the programme are limited to acertain number of kW and only those schools

that have been accepted onto the programme at

the time the funding is drawn will therefore be

able to take advantage of the proposal so it is

time sensitive.

It should also be noted that from 30 April 2012 it

is highly likely that the FITs will be reduced. This

means that any private sector offering to schools

will be on inferior terms. Therefore time is of the

essence.

There is no clear process concerning emergency

works.

The process is explained in the Terms &

Conditions. The School will contact theOperations Manager who will coordinate actions

with the school. Details of the Operations

Manager will be provided if a school is accepted

onto the programme


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What warranties and guaranties are in place toensure quality of the equipment and

installation? Is it clear where liabilities rest as a

result of any failures?

Because the programme is being funded byleading international financial institutions, this is

being managed carefully for financing purposes.

The PV plant and equipment is owned by the

special purpose vehicle that is being financed

and there will have been a sign off by the

independent technical adviser as to the quality

of the equipment to be installed as a condition of

financing. The Terms and Conditions make it

clear that maintenance and replacement is the

responsibility of the Owner, not the school.

The maintenance arrangements are short on

detail.

Since the school is not the purchaser or owner,

it merely needs to know where responsibility lies(and on this the Terms & Conditions are

explicit). The Owner and the O&M Contractor

have a detailed contract prepared to

international project finance standards (>60

pages), as required by the financing institutions.

The Schools can take comfort that the lead

institution is funded by major pension funds who

are every bit as concerned as they are.

There are lots of clauses affecting the school, for

instance the requirement for access between

0800-2000 hours. This would mean the school

would have to provide out of hours staff.

The installation process is around one week and

the school will of course be advised about the

precise installation timing in advance. Avonside

as the roof installation group have done aconsiderable amount of school work in the past

and have recommended the hours on the basis

that certain aspects of the work will be best

carried out outside of normal school hours eg

loading and unloading in the interests of health

and safety. Once the installation is complete

access would be by arrangement with the school

only.


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The document contains open ended terms like 'asquickly as possible'. These clearly need to be

defined to reduce the opportunities for

misunderstandings. In fact the whole agreement,

whilst written in the spirit of co-operation is

vague. This leaves the document open to

interpretation.

The contract has been carefully prepared inconjunction with a major law firm to be on a

basis that (1) the schools can and should

actually understand what they are agreeing to

and (2) at a level of detail which is appropriate to

the scope and extent of what they are being

asked to do, namely hosting PV panels at no

cost to themselves in return for which they are

given the power for free. There is plenty of case

law as the meaning of terms such as as quickly

as possible although it is considered that

people will understand what this means in

practice. Please also bear in mind that since

continuous performance is also demanded by

the financing institutions and that part of the

operations managers remuneration is based on

maintaining performance in the usual way, there

is, in fact alignment of interests to ensure

downtime is minimised. This is also the reason

for having real-time remote monitoring of each

PV facility to ensure outages can be minimised

Please do accept this correspondence in the spirit

in which it is meant; that is to get the best

possible deal for public money and our schools

whilst helping reduce carbon emissions. The

County Council and the Energy Team are strong

supporters of the Eco-Schools programme and

want to see the existing good quality maintained

so feel bound to make our comments and

concerns known to you.

It is key to appreciate that public money is not

being spent on this programme. It is funded by

the private sector at a scale where best practice

associated with international financings (rather

than cowboy installers) can be employed. At the

end of the day, however, it will not be possible to

include a school if it is located in an area where

the local authority is unsupportive: the investors

will not accept this and Eco-Schools is therefore

seeking to avoid this.

Documents

Solar Briefing Note for Local Authorities on Procurement