Sheffield Heat Network Development Partner

This notice relates to the proposed market engagement activity for the heat network development opportunity for which Sheffield City Council intends to shortly procure a Development Partner. Sheffield City Council has been selected as part of the Department of Energy Security & Net Zero’s Advanced Zoning Programme to develop the country’s first zonal scale heat networks.

To deliver this, Sheffield City Council is seeking a Development Partner to develop (and present for their approval) a zonal scale heat network in the Sheffield area. Sheffield City Council has undertaken work to identify a reference scheme in an area of Sheffield city which has an estimated annual heat demand of c. 60 GWh.

The area which will be the subject of the procurement (and which the Development Partner will be invited to deliver development proposals in respect of) is wider and has an estimated annual heat demand of up to. 900GWh. Sheffield City Council intends to conduct a procurement using the open procedure in accordance with the Procurement Act 2023 to select the development partner for this opportunity.

If successful, the parties would enter an agreement for development services only (known as the Development Agreement Only model) under which the Development Partner would put forward proposals for a zonal scale heat network in the area. These proposals would need to meet minimum criteria and would be subject to review and approval by Sheffield City Council.

Delivery of such a network in the area would be on a non-exclusive basis (subject to any future regulation). Sheffield City Council does not propose to have any shareholding in the corporate vehicle which will develop and, subject to the terms of the Development Agreement, go on to deliver and operate the heat network in Sheffield. More information on the scale of the opportunity, the reference scheme and the contractual and procurement approach will be presented at the Market Engagement Day.