The Head of Operations – Community Services reported that the Council was selected as a demonstrator for the Smart Systems Heat (SSH) Programme in October 2014, with the Caerau Mine Water Heat project proposed as one of the demonstrator projects for the programme.  He stated that the project is highly innovative and proposed to extract heat from water contained within flooded former coal mine workings to provide a resource for properties within Caerau.  The mine water will have heat extracted and transferred to a clean water circuit.  This water would be transported via a network of pipes to local energy centres where the temperature would be boosted to the required temperature by ground source heat pumps and then circulated to the residents’ houses.

He reported that a successful application was made to WEFO for grant funding, with a formal grant offer of £6,498,943 made.  However following the findings of survey work and structural changes within the Council, there was a need to submit revised proposals to WEFO in July 2019, subject to the approval of the Section 151 Officer.  WEFO will undertake an assessment of the revised proposals and if approved, issue a revised funding letter.  He stated that if any of the proposed changes or revised terms and conditions are considered unacceptable, officers will consider the implications and associated risks and escalate as required.  Legal and financial approval shall also be sought.  Acceptance of the above revisions and agreement of revised funding offer will ensure a shared understanding of the project based on current information between the Council, WEFO and key stakeholders.  He outlined the decision gates along with the estimated dates of when they may occur, together with the proposed project outputs and outcomes. 

The Head of Operations – Community Services informed Cabinet that the project is overseen internally by a Project Internal Governance Board, supported by an external Stakeholder Group.  He outlined the original funding profile for the project, together with the match funding for the proposed revised profile, which would increase the funding offer from £6,498,943 to £7,287,000.

The Cabinet Member Communities commended the proposal which was integral to the Local Area Energy Strategy and Smart Energy Plan and is an exemplar project in Wales.  The Cabinet Member Social Services and Early Help commented on the need to ensure that a number of households were on board and that there was community engagement.  The Head of Operations – Community Services confirmed there will be a dedicated resource for community engagement and the project would in part, be funded by the number of households which had signed up.  The Cabinet Member Communities confirmed that public meetings will be held at Maesteg Town Hall.  The Leader was heartened to see the work being done in primary schools in order that the next generation see the benefits of sustainable heat and that a new use was being found for former mines.

RESOLVED:               That Cabinet:                                      

(1)   Noted the progress to date of the Caerau Mine Water Heat Project;

(2) Delegated authority to the Section 151 Officer,  subject to the approval of the Head of Legal and Regulatory Services, to accept a revised funding offer from WEFO; and

(3) Delegated authority to the Chief Executive, in consultation with the Section 151 Officer and the Head of Legal and Regulatory Services, to enter into any funding and/or legal agreements required as a result of accepting the revised funding offer from WEFO.