‘EXTREMELY volatile’ prices force Slough Borough Council (SBC) to buy energy in advance to avoid anticipated high fees.

‘As a result of further fluctuations in the market,’ the cash-strapped council is to increase its £2.4m budget by an extra £1m to manage a rise in in-year pressures.

It will also increase its school energy budget to £1.4m as well as set its social housing budget to £1.2m. ‘These costs will be passed on to the relevant areas and will not form part of the general fund pressures,’ a report that went to an emergency cabinet meeting last week stated.

It also stated the market is ‘extremely volatile’ because of the war in Ukraine. SBC is to ‘immediately’ buy 100 per cent of its energy consumption until March 2023.

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Before this, SBC was spot purchasing its energy, which was the “most efficient” at the time, but the council was warned there is a ‘high likelihood’ of energy prices rising until the end of 2022 and should lock in for the next eight months.

Speaking at an audit and governance meeting on July 28, chief finance officer Steven Mair said: “There will still be an impact on the council’s budget of roughly £1m in the general fund.

“There will also be an impact in the HRA [housing revenue account] and on the schools, but it does give us certainty and it will be less of an impact than if we continued spot buying for the international reasons that we know about.”

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He also said the council will keep its energy monitoring under constant review. Senior councillors approved the proposal to buy the forecasted energy last week.

A proposal to further reduce consumption levels was put forward by changing Slough’s street lighting lux levels.

SBC is needing to sell up to £600m of its properties and land in order to reduce its £680m borrowing debt and bridge its £479m blackhole.

As the assets will no longer be under the council’s control, the report states this will further ‘lessen the burden on the budget,’ the report stated.