Sustainable Lesson

17 February 2009

Dalkia and North Somerset Council have developed a PFM Award winning model for an integrated approach for schools to lower utility bills while increasing funds for improvements to energy efficient lighting, heating plant and controls. Jane Fenwick reports

INVESTMENT IN THE RENEWAL AND REBUILDING OF THE NATIONAL stock of schools continues apace. The Building Schools for the Future programme represents the biggest single investment in school buildings for more than 50 years, and in addition there new school facilities being built under PFI/PPP and Academy schools programmes.

The national school estate comprises over 17,300 primary schools, over 3,300 secondary schools, nearly 500 nursery schools, 46 academy schools, 10 City Colleges and a further 2,200 independent schools. Renewing and refurbishing facilities to provide a 21st education to children of all ages is undoubtedly necessary and welcome.

However, the cost of running all schools is growing. In the largely rural county of North Somerset which has 78 schools for its 28,000 children, almost half of the Council’s budget is spent each year on running their schools. The Council is responsible for overseeing their management but the schools themselves manage ‘devolved’ budgets that often amount to £millions to cover their running costs from paper and books to IT and energy.

With unstable energy costs and pupil, parent and government pressure to be more aware of environmental impact of schools facilities, the schools have found it difficult to manage the varying costs of energy or maintain their plant efficiently, let alone implement energy / carbon saving initiatives that had a long term payback. Steve Hodges, North Somerset Council’s Energy, Policy & Projects Officer also recognized that adequate maintenance was not being conducted on aging plant making it both inefficient and liable to breakdown, and, ultimately, replacement at the Council’s expense. There were also growing compliance issues that were not being satisfactorily managed. He was determined to find a better way and invited tenders for a partner to not just maintain the school plant but also improve the energy efficiency of the estate.

Selecting Dalkia, Hodges found a Dalkia team willing and capable of developing a successful performance partnership contract with North Somerset Council that is a highly innovative service provision model within the public sector. Tackling the nature of local authority financing head-on, Dalkia and North Somerset Council were able to develop a selfsustaining model for successfully servicing the Council’s school’s building maintenance and energy requirements. This represents a radically new approach to partnering in the public sector.

Before… under the previous arrangement:
● Limited planned maintenance
● High level of reactive issues
● No maintenance schedules
● No asset schedules / dilapidation report
● Ad-hoc maintenance approach to water hygiene and statutory inspections.

After.. with the Dalkia partnership:
● Regular planned maintenance
● Cash savings from energy programme reinvested in additional energy saving initiatives
● Low level of reactive calls, first 2 hours included in planned maintenance cost
● Comprehensive maintenance schedules
● Full asset schedules and rolling dilapidation reports provided
● Structured approach to all water hygiene and statutory inspections.

Many local authorities want to develop more sustainable practices but the constant issue is one of funding. The Dalkia team worked with North Somerset to enable the Council to develop a sustainable approach to the management of its estate without incurring huge costs and jeopardising core budgets.

According to Hodges, “The Council seeks value for money, but is equally conscious of its environmental obligations. Through this unique approach we are controlling our costs and demonstrating our responsibility to our community-charge payers, whilst at the same time achieving a really positive contribution to carbon reduction across the schools estate.”

This 10 year contract represents a substantial commitment by North Somerset Council and similarly provides a realistic timeframe for Dalkia to deliver a return on its investment. It is also the largest energy services contract currently running in the local government sector. It has also attracted attention as a replicable model both in counties neighbouring North Somerset, but also at national level.

Dalkia has undertaken a structured approach to programme implementation that will help North Somerset Council to reach its targets, over the initial, medium and long-term Currently 12 secondary schools and 70 primary schools in North Somerset are benefiting from Dalkia’s innovative approach to partnering. Each school manages its own budget and makes its own financial decisions, so the Dalkia management team has to ‘sell’ the partnership benefits to the head teacher, business manager or burser and the school governors in each school in turn.

At each interested school, Dalkia undertakes a site assessment and briefing seminars with school heads and governors. An energy management and maintenance plan for the school is prepared, discussed and approved. Implementation is in three stages:

Stage 1 - Enhanced planned maintenance service to reduce reactive costs.

Stage 2 - Develop energy management solutions to implement initial energy reductions through operational improvements and minimum investment

Stage 3 - Identify and develop more capitalintensive energy management solutions for increased consumption reductions. This includes boiler replacement, new controls and improved lighting. A planned lighting programme reduces the need for and ad hoc outlay of reactive maintenance call-outs to fix faults, as well as investment in new controls and updated plant that runs more efficiently.

The contract works by integrating energy management with M&E maintenance to generate financial savings and carbon emissions reductions. The capital savings made from the process are then re-invested in further building improvements across the schools. The schools gain by having well maintained plant that is less likely to breakdown – or when it does it is fixed within hours not necessitating school closures – and it runs more efficiently. The schools pay for maintenance and energy in equal monthly payments throughout the year, making it easier to budget than before when unexpected fuel or ad hoc maintenance bills occurred.

As a result of the partnership North Somerset Council has seen a cost saving in excess of 10 per cent in the first two years. It has helped to manage the risk of rising energy costs, allowing predictable forward planning. Planned maintenance of facilities has reduced reactive breakdown maintenance. Reduced energy consumption provides emissions reductions and investment in lighting, heating and fabric with no capital investment required. Schools have no complicated bills and fixed annual spend is inline with existing costs but with added benefits of well maintained, remotely managed and more energy efficient plant.

As part of the contract Dalkia and North Somerset Council are also committed to:
● Educating the pupils on energy use and issues, including the pupils’ impact on climate change and in their local environment
● Communicating to pupils how they can take their own measures to reduce energy and carbon use
● Highlighting to the pupils an overview of careers to consider in this technically demanding but engaging field.

Several of the schools within the Council’s control engaged with the initiative further still. Pupils of St Katherine’s School took part in workshops arranged by North Somerset Council and delivered by Dalkia. As part of this Dalkia developed a fun and Interactive game to engage the children with the reasons for saving energy and help them to understand the principles of sustainability.

As head teacher Stephanie Quayle explained, “As a Science College the workshops delivered a very important message about sustainable energy and energy use which links very well with the ethos of St Katherine’s.”

At St Martin’s Junior School, where a whole sustainable development plan is underway, Dalkia is working with the school to dovetail its activities to produce a comprehensive eco-strategy. Dalkia's solution for the School was to replace the 40-year old oil-fired heating and hot water system with a new condensing boiler that uses gas supported by a solar thermal system (right), along with pipe insulation and a building management system to provide precise control. These measures will ensure reduced fuel

What the PFM Awards Judges said “The Council was determined to not have just a short-term energy management solution but to also ensure plant improvement for the future. Dalkia innovated to provide a solution that works to achieve the Council’s sustainability ambitions in schools whose budgets they do not control. This partnership has provided the framework in which to change the school estate to a sustainable future through an expert partner who takes over from the school responsibility for plant maintenance and improvements to lighting, heating and cooling, and ensures compliance. “