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Agenda

Background and Concept

Sharing the benefits

Current Members

Contract Set Up

Contract Structure & Benefits

What the members are saying

Marketing

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Background & Concept

Collective energy procurement service for UK arts organisations

Founding members: Royal Albert Hall, Royal National Theatre & Royal Opera

House

Arts orgs supporting one another

Main objectives:

Provide members with a transparent and mutually beneficial platform to obtain

competitively priced energy supply contracts

Deliver savings against the financial plan and the average market

Protect the members’ budgets

Best value for all members

Costs are fairly allocated

Set up as flexible contract – allowing PE to purchase energy directly in the

wholesale market

Timing and rules for energy purchases defined & governed by Risk Management

Strategy

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Sharing the benefits

Pooling energy together – more attractive to suppliers

Leverage from Multiple brands

Access to wholesale market

Arts basket dedicated support team

Experts handling managing your procurement

Driving down energy costs and building green credentials

Transparent reporting

1st Year savings = 7% below market, Yrs 2 & 3 below market 8%

Contract in place easy to join

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Current Members

Founding MembersFounding Members

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Contract Set Up

Half hourly electricity contract set up in April 2012

following competitive tender process

Contract awarded to Scottish & Southern based on: Lowest price

Fixing of most non-energy charges – only RO, DUoS & TUoS are

passed-through, but fixed for 12 months at a time

Attractive contract features, including:

Favourable trading arrangements – full access to wholesale market

prices & provision of sell-back facility

Ability to actively manage customer portfolios

Risk Management Strategy is in place and showing the

benefits

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Contract Structure & Benefits

36 month flexible contract commencing 01 October 2012 following a competitive tender

Favourable trading arrangements – full access to wholesale market prices & provision of sell-back facility

Customer-specific pricing Billing in line with simple fixed price contracts – rates set in 12 month

intervals Fully inclusive day/night unit rates

Standing charge

Available capacity charge

100% Renewable Energy supplied at discount on CCL rate Annual +/- 15% volume tolerance on group level Ability to re-forecast contract volume at any time Ability to add & remove sites Ability to add new customers

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Risk Management Strategy

Risk Management Strategy set up by PE Agreed with founder members and applied to all basket members

Based on clients objectives and PE view on current and future markets

Setting of budgets for entire contract term

Objectives: Conservative approach to risk

Protecting customer budgets

Minimising costs

Tactics: Controlling risk through tiered purchasing

Utilisation of a range of purchasing triggers – stops, trailing stops, targets, time limits

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Scottish & Southern Sustainable Generation

Technology 2012/13 2013/14 2014/15 2015/16

Biomass 10% 7% 6% 5%

Hydro 7% 6% 6% 6%

Landfill Gas 1% 1% 0% 0%

On-Shore Wind 49% 58% 62% 62%

Photovoltaic 0% 0% 0% 0%

Waste 10% 0% 0% 0%

Off-Shore Wind 23% 28% 26% 27%

Total 100% 100% 100% 100%

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What the members are saying.....

Jessica Hepburn, Executive Director, Lyric Hammersmith

‘ It’s fantastic to be collaborating with our peers to improve our

collective sustainability. The Lyric is fully committed to being a leader

amongst arts venues who want to reduce their impact on the

environment and we are delighted that the Arts Basket has become a

major part of our green arsenal’

Sally O'Neill, Director of Finance, Royal Opera House

“The Arts Basket is a major opportunity for venues like ours to cut

energy costs which are a significant overhead. We want to encourage

other arts venues and theatre managers to consider applying to join the

Basket.”