Labourâ€™s Bassam Mahfouz is evidently pleased with his appearance on the Sunday Politics TV programme in Sunday, click here and move the slider to 44:20.
Cllr Mafouz mentioned LED lighting.
But on top of that we are looking at moving forward by installing energy efficient LED lighting right across all of the streetlights that we have in the Borough.
As it happens we were discussing this programme with council officers last night at the Conservative group meeting. If you look at the Budget Strategy Report 2012/13, Appendix 4, page 3, row 14 you will see that the council is planning to spend Â£6.8 million on this apparently commendable venture. When officers were challenged on the payback period for this â€œinvestmentâ€ the answer was 12 years. The lights are only due to last 15 years so they will only be “above water” or “in the money” for the last three years of their lives.
There is no way that a business would expend scarce capital on a project with such a long payback period. Although the councilâ€™s cost of finance is lower than most if not all businesses it is very strange that the council wants to take on Â£6.8 million of debt on such a shaky project. Apparently officers are trying to model future energy prices to make the payback period look better. Sounds like post justification of a poor decision and warped priorities to me. No business would speculate on far distant energy prices to justify such a decision. On a philosophical note examples like this show how government “crowds out” businesses – people would rather lend to governments to do stupid things than companies that would potentially invest in more useful things for the economy.
Once such LED streetlights become more common their price will plunge. We should not be an early adopter. When the payback period gets down to 2 or 3 years at current energy prices we should jump in. In the meantime there are better things to do with the money â€“ even if only to leave it in the hands of residents. They could certainly find some projects with better payback than 12 years.