Electricity drought to Government investment.
Electricity provision to unlock otherwise financially preventative development opportunities Government Business Case for Ebbsfleet Development Corporation
SITUATION
Requirement to secure electricity for the Ebbsfleet Garden City (EGC), being a quarry there was no previous need for power provision A Business Case for the Ebbsfleet Development Corporation (EDC) to gain HM Treasury investment via the Dept of Communities & local Government (now the Ministry of Housing, Communities & Local Government) was required
TASK
Research and develop the Business Case to give confidencetoHMTreasurythataninvestmentof£301m would enable housing to develop; safeguard the electricity for private developer partners to build at pace; and withstand scrutiny to improve corporate governancebyensuringopenness,accountability,and transparencyindecision-making
ACTION
Working with a specialist in Utility Law & an Economist, Diligence provided the technical knowledge and experience from working within Distribution Network Operators (DNO), producing the Business Case
Worked through the details of the Regulatory Framework to which the DNO abides, the Terms & Conditions of Business and the Legal Position on Government Investment, a method of recovering a minimum of 75% of the investment and ensure that both the EDC and the DNO were not at risk of contravening the Treaty on the Functioning of the European Union (TFEU) relating to State Aid
Understanding the complexities and boundaries, we worked with the Infrastructure & Projects Authority (IPA) & Ofgem. This resulted in Connection Charge Change.
RESULT
Government invested £301m It was used as a ‘blueprint’exampleforthe‘HousingInfrastructureFund SupportingDocumentforForwardFunding’
On1April2017,anamendedlawwaspassedtoensure that Government & Utilities are protected in the provisionofinfrastructurebyGovernment Signallingthe wayforotherLocalAuthoritiestobecomedevelopersin theirownright
AT A GLANCE
Challenges
Never been done before Supporting Forward Funding with Public Funding
Safeguarding capacity for Ebbsfleet development
Outcomes
Successful Business Case approved by HM Treasury £301m investment from Central Government
LAs able to become developers
Housing delivery at pace
Used as example in the Housing Infrastructure Fund (HIF) Guidance
SignificantAchievement
‘This infrastructure deal demonstrates our continued commitment to the Ebbsfleet project as a leading example of innovative and ambitious solutions to help fix our broken housing market and increase housing supply ’
Alok Sharma, Housing Minister 2017.
