Public procurement notice: Contract Award Notice
Published: 2020-11-18
Buyer: Midlothian Council
Country: UK
Contract type: Works
Procedure: Competitive dialogue
CPV classification: 45251250
Estimated value: 100000000 GBP
Award criteria: The most economic tender

Technical requirements: Midlothian Council (the Council) is seeking to procure an energy partner. The Council wishes to identify a partner with the most economically advantageous tender to work with the Council on the scoping, design, procurement, financing, implementation, delivery, operation and maintenance of decentralised energy projects in Midlothian and the surrounding areas (including but not limited to district heatin, direct wire electricity, solar PV and electric vehicles) together with associated works, services and supplies. The first project likely to be progressed is the development, delivery and operation of a top up/back up energy centre and associated district heating network to serve the new emerging Shawfair Town. The primary source of low carbon heat will be from an adjacent existing Energy from Waste facility. The Council requires elements of this project to be commissioned by September 2021 to meet applicable funding conditions.
Midlothian Council is seeking to procure an energy partner. The Council wishes to identify a partner with the most economically advantageous tender, to work with the Council on the scoping, design, procurement, financing, implementation, delivery, operation and maintenance of energy projects in Midlothian and surrounding areas (including but not limited to district heating, direct wire electricity, solar PV and electric vehicles) together with associated works, services and supplies. It is anticipated that this will involve development of a joint venture with the Council. The nature of the joint venture and potential funding and financing solutions will be explored during dialogue but is likely to involve the creation of a jointly owned Energy Services Company (ESCO). The duration of the joint venture will also be discussed in dialogue but it is possible that if an ESCO is established that it would not have a pre-determined lifespan. The Council will then enter into a concession agreement with the ESCO for the development and delivery of projects involving Council heat loads or land or generally within Council control. The concession duration will be explored during dialogue but the Council anticipates that this will be 25-40 years.
The first project likely to be progressed is the development, delivery and operation of an energy centre and associated district heating network to serve the new emerging Shawfair Town of up to 2900 homes plus associated Council buildings such as a new school. The Council requires the first phase of this scheme to be commissioned by September 2021 to meet applicable funding conditions. The Council anticipates that this project will involve a concession granted to the ESCO by the Shawfair developer, Shawfair LLP. The concession duration will be explored during dialogue but the Council anticipates that this will be 25-40 years.
The heat source identified for the initial projects is the energy from waste plant situated at the former Millerhill Marshalling Yards in Midlothian and operated by FCC under contract with City of Edinburgh Council for the benefit of City of Edinburgh Council and Midlothian Council. It is anticipated that other projects will subsequently be identified and awarded to the successful partner. The partner will be responsible for identifying and developing such projects. This will be subject to all necessary permissions, partner performance and the availability of funding or financing. In each case these projects, including the Shawfair scheme, may involve the sale of energy to the contracting authority and the other contracting authorities named in the OJEU notice.
The jointly owned ESCO, Midlothian Energy Ltd, was established on 13 November 2020. The ESCO will progress the development of various energy projects across Midlothian and surrounding areas including the sale of energy and the provision of enabling works and services. The ESCO will procure and advertise supply chain opportunities on these projects as appropriate.


Winner: Vattenfall Heat UK Ltd
Award value: 100000000
Number of bids: 2