Enfield set to make millions from new energy company
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Feel the heat: the Meridian Water development. Image: Enfield Council, Flickr
Enfield Council is to create a wholly-owned energy company which is set to reap millions in profits.
The council last week agreed the business case for the new company, Energetik, which will initially supply around 517 homes in a flagship regeneration scheme.
The company will be established with £6m each from the European Investment Bank and the London Energy Efficiency Fund.
Any remaining funding is likely borrowed by the council from the Public Works Loan Board and lent onto the company at a commercial rate. However, funding decisions are still to be made by Enfield’s treasury team leaving open the possibility of using other sources.
Jeff Laidler, business development director at Energetik, told Room151: “By creating the company ourselves, we are able to define a very high technical specification for the heat network we are creating through the company.”
Energy boost: Website of Enfield Council’s new energy company
The business case for the company predicts the council could make a return of £10.3m over the 40 year business plan, plus £5.97m from the interest rate premium on any loans, plus £800,000 a year business rates from the company.
Laidler said the exact scale of any loans would be a decision delegated to the council’s treasury team.
The first phase of the business plan is based on the scheme being rolled out to 15,000 homes, mainly in the Meridian Water regeneration scheme.
However, Laidler said that if the scheme proved successful, it could more than double in size.
He said: “It will take a while for us to recoup our initial investment and turn it into a profit, but hopefully we can expand the scheme to create a bigger return.”
Enfield Council’s cabinet member for economic regeneration and business, Alan Sitkin, said: “Energetik is a ground-breaking venture which will return £225m of economic, environmental and social benefits to residents and businesses in Enfield and the wider community.
“The heat networks are designed to expand, with capacity to double the number of homes and businesses receiving heating and hot water across North London.”
