The Octagon Project Energy Network (OPEN) is a decentralized energy network in Manchester that will provide locally produced low-carbon electricity, heating and cooling to public, commercial and residential customers. It will initially install 9.9MW of combined heat and power generation and connect 25 stakeholders, providing 84GWh of electricity and 75GWh of heat annually. The OPEN aims to reduce energy costs and carbon emissions for stakeholders in line with the city's targets to be carbon neutral by 2035, with early estimates suggesting it can achieve average carbon reductions of 10-22% for participants.

1. OCTAGON PROJECT ENERGY NETWORK
M A N C H E S T E R
GENERAL OVERVIEW - JUNE 2020

2. The OPEN is a Decentralised Energy Network, designed to provide locally produced, low-carbon electricity, heating and cooling, to a
diverse group Stakeholders, including public–sector, commercial and residential bulk off-takers, each with a different energy consumption
profile, located within a city centre urban environment. The Project Area covers over 5 sq.km., and includes Manchester University NHS
Foundation Trust, major University buildings, Plymouth Grove Village (a mix of social and private housing), multiple Student
Accommodation Operators and the Octagon Project itself, together with other commercial organisations, such as Heineken, a major
international brewer. The project being undertaken by Manchester Energy Partnership Limited (“MEPL”) at a cost of circa £30m.
MEPL is a unique joint venture collaboration between Octagon Estates Ltd., (developer of the Octagon Project) and Electricity North West
(Contracts and Maintenance Division) Ltd, which is part of the Electricity North West Group - the local Electricity Distribution Network
Operator (“DNO”). MEPL will initially construct 9.9Mw of Combined Heat and Power (CHP) generation at the Octagon site energy centre,
to supply a substantial section of the local community with sustainable, price stable and resilient energy sources.
25 principal stakeholders are targeted for connection, each of which is at various stages of engagement, ranging from ‘early interest’ to
those who have signed an MOU (a process which can lead to a Supply Agreement, on mutually agreed terms and tarrifs). The total annual
Phase 1 network demand to be satisfied by the OPEN (operational in Q3/2021), is heat 75 GWH and electricity 84 GWh, with estimated
expansion in phase 2 to; heat 96 GWH and electricity 126 GWh.
The principal benefits of the OPEN to its Stakeholders are:- Guaranteed Reduction in Energy Costs, of 15% plus : along with;
Lower Energy Consumption : Reduced Capital Expenditure : Reduced Carbon Footprint : Lower on-site Maintenance costs.
MEPL is aware that the success of the OPEN will be measured by the reduction in carbon emissions achieved for its stakeholders; in line
with both the City Council’s and GMCA targets to become carbon neutral by 2035.
Early estimates suggest that connection to the OPEN can support average reductions of 10%
for participants, with at least one major off taker achieving a 22% reduction from present
carbon emission levels.
The OCTAGON PROJECT ENERGY NETWORK (“OPEN”)

3. THE OCTAGON PROJECT – PARTNERS & ALLIANCES
A collaboration between key Manchester organisations, dedicated to lowering its carbon footprint, developing the
life sciences economy, creating employment and contributing to the overall wealth of the city.
Manchester City Council and the Greater Manchester
Combined Authority (“GMCA”) - Low Carbon Initiative
Partners.
Manchester City Council is a long-term supporter of
both The Octagon Project and the OPEN, having entered
into a Memorandum of Understanding in 2016.
Working closely with the GMCA, both bodies are keen to
ensure the success of the OPEN, since they see it
making a valuable and permanent contribution, both to
their ambitious carbon reduction targets and in
promoting the city’s position in the life sciences sector.
The City Council and other local agencies are working
with the Octagon Project to bring commercial vibrancy,
growth and regeneration to this important area of the
City, to enable businesses based here to thrive and
maintain a strong commercial advantage in an
international market-place.
Department of Business Energy and Industrial
Strategy (“BEIS”)
Support for the OPEN has also come from central
government, including the Heat Network Development
Unit (“HNDU”) which has provided grant assistance to
enable the techno-economic modelling and feasibility
study to be undertaken, taking the project to the full
commercialisation and the pre-construction stage.
The project is also pre-approved for circa £15m of
HNIP (Heat Network Investment Project) funding, with
the full application currently underway.
MIDAS – Manchester’s Inward Investment Agency
The Octagon Project is also working in close harmony
with MIDAS to promote and encourage businesses to
join this economic ecosystem and become part of a
city striving to foster the development of world
leading, healthcare services and medical technology,
research and innovation in the region, as part of the
Northern Powerhouse.
Ikigai Capital Ltd. - Project Finance Partners to the OPEN:
Leveraging the most appropriate blend of development
finance, long-term debt and equity funding from investors
and financial institutions, to ensure the correct balance
between investor IRR and economy in end user energy
pricing.
OCTAGON ESTATES LIMITED - Property Developers and
Estate Managers The Octagon Project
Already home to the new Central Manchester NHS Renal
Dialysis Unit, the Octagon building is undergoing further
major refurbishment, to provide over 100,000 sq.ft. of
accommodation, for the healthcare and medical sectors,
including an Imaging & Diagnostic facility and a new Data
Centre, to be completed early next year.
Electricity North West
(Construction and Maintenance) Limited
ENW (C & M) Ltd (a 50% shareholder in MEPL),
represents the non-regulated interests of Electricity
North West. Working with Octagon Estates Ltd and
Sustainable Energy Solutions Ltd., ENW have
demonstrated their commitment to support
community driven, cost effective and efficient, local
electricity generation, to help improve demand
management and meet the expanding needs for
power in this area of the city. Their participation in
the OPEN, will improve performance, ensure
resilience, help off-takers achieve their carbon
reduction targets and thus reduce energy bills for
consumers.
Sustainable Energy Solutions Limited - Energy Partner
The driving force behind the OPEN, SES has resourced the
five year project to bring it to commercial reality. SES is a
specialist in bespoke retro-fit energy solutions for bulk users,
such as purpose built student accommodation operators.
Helping to improve their environment, assist with carbon
emission targets and create long term benefits, in the form
of lower energy bills and more efficient use of energy
resources for many years to come.

4. “Community Sustainability”, as opposed to “Insular Self-sufficiency”. Stakeholder Collaboration.
Enables resources (both energy and plant) to be used to maximum efficiency by all connected Stakeholders.
ETHOS OF THE OCTAGON PROJECT ENERGY NETWORK
“Community driven, locally generated, reduced carbon, heat and power, delivering maximum efficiency and economy to consumers, whilst
ensuring the highest levels of resilience, continuity of supply and sustainability, working in harmony with the local electricity Distribution Network
Operator (Electricity North West Ltd.)”.
Combining cooperative principles with cutting edge technology to improve energy efficiency and achieve the best possible use of all stakeholder
resources and derive economies of scale.
University of
Manchester
Grove Village Social
Housing
Manchester University
NHS Foundation Trust
Octagon House
Nick Everton House

5. The Octagon Project Energy Network
was conceived in 2014, following site
acquisitioning in 2013.
In 2015, THE OCTAGON site was
identified in a report, commissioned
by GMCA Low Carbon Unit
(undertaken by ARUP) to be the
perfect site for a decentralised
Generation Hub to service the heat
and electricity demands of a
substantial area, south of the city
centre; the Oxford Rd. Corridor.
The self-contained, fenced and gated
site is strategically located, one mile
south of Manchester City centre, close
to the city’s main hospitals,
universities and research institutions,
together with areas of social housing
and a number of purpose build
student accommodation
developments.
The site lies adjacent to ENW’s main
High Voltage distribution infrastructure
and primary sub-station. Providing
superb power resilience at the point
of connection.
OCTAGON PROJECT ENERGY NETWORK – NETWORK ROUTE DEVELOPMENT
Serving the Oxford Rd Corridor & Enterprise Zone
Ongoing Stakeholder Engagement
The Octagon Energy Centre is based on
modular, up-scalable, gas-fired CHP
units, located adjacent to the ENW
primary sub-station, together with PV
arrays and ASHP’s.
The CHP’s are designed so that the
primary energy source may be changed
to respond to advancements in
sustainable technologies. The
relationship with ENW enables both
heat and electricity, to be distributed via
a new system of pipework and cabling
to local Stakeholders, with resilience
maintained at the generation source.
The OPEN will Incorporate remote
monitoring of each individual off-takers
consumption (interfaced with their local
building management system). This
enables the network not only to monitor
each off-takers usage but also to
automatically detect any efficiency
issues; enabling the network to
intelligently respond, to balance and
demand match the heat and power
requirements of each Stakeholder
This will be combined with thermal and
battery storage to efficiently manage
peaks in demand.

6. OCTAGON PROJECT ENERGY NETWORK
Headline Figures. Estimated Capital Cost of Construction circa £31m
4 km of heat transmission network. 3 km of power transmission
OPEN Phase 1 – (16 off-taker site connections)
Installed Generation Capacity -:
2 x 3.3MWe CHP units (each recovering 2.5MWth)
1MW of heat pump capacity (small units distributed across the network)
2 x 8MW gas fired boiler capacity
Augmented by 2MW solar array (across multiple sites)
Maximum Output from Phase 1:
Total thermal capacity = 22MWth
Maximum full-output potential annual thermal output 193 GWh.
Total electrical capacity = 8.6MWe
Maximum potential full output annual electrical output = 60 GWh
Current Demands:
Thermal demand of the Phase 1 network = 75 GWh (post de-steaming the hospital)
Electrical demand of the Phase 1 network = 84 GWh
Actual Thermal Balance:
Heat from CHP = 40 GWh
Heat from heat pumps = 7 GWh
Heat from gas fired boilers = 28 GWh
Total output = 75 GWh (matched with demand)
Actual Electrical Balance
Electricity from CHP = 54 GWh
Electricity from Solar PV = 2 GWh
Electricity from Grid = 28 GWh
Total output = 84 GWh (matched with demand)
OPEN Phase 2 - (9 additional off-taker site connections):
Installed Generation Capacity -:
3 x 3.3MWe CHP units (each recovering 2.5MWth)
1.5MW of heat pump capacity (small units distributed across the network)
3 x 8MW gas fired boiler capacity
Augmented by 3MW solar array (across multiple sites)
Maximum Output from Phase 2:
Total thermal capacity = 33MWth
Maximum potential full-output annual thermal output = 289 GWh.
Total electrical capacity = 12.9MWe
Maximum potential full-output annual electrical output = 89 GWh
Current Demands:
Thermal demand of the Phase 2 network = 98 GWh (post de-steaming the hospital)
Electrical demand of the Phase 2 network = 126 GWh
Actual Thermal Balance:
Heat from CHP = 55 GWh
Heat from heat pumps = 9 GWh
Heat from gas fired boilers = 34 GWh
Total output = 98 GWh (matched with demand)
Actual Electrical Balance
Electricity from CHP = 80 GWh
Electricity from Solar PV = 3 GWh
Electricity from Grid = 43 GWh
Total output = 126 GWh (matched with demand)

7. OPEN Energy Centre – Design Development
2 x 3.3MWe + 1 X3.3MWe
THE ENERGY CENTRE COMPRISES:-
• Phase 1 - 2 x 3.3MWe CHP units
(2.5MW of thermal each), with planned
expansion to 9.9Mw, to align with
stakeholder uptake.
• 3 acre site enables future plant
upscaling in response to increased
demand.

8. PROJECT AREA -HEAT & POWER NETWORK ROUTE DEVELOPMENT
SCOPE OF THE OPEN – SHOWING THE DIVERSE RANGE OF STAKEHOLDERS AND EXTENT OF THE GEOGRAPHIC AREA COVERED,
FROM THE 3-ACRE GENERATION & CONTROL HUB, LOCATED AT THE OCTAGON PROJECT SITE ON HATHERSAGE RD.
OPEN – Phase One
1. Octagon House Workspace; Imaging & Diagnostic Centre
2. Manchester University Foundation Trust
3. NHS National Blood and Transplant Unit.
4. Plymouth Grove Village (Your Housing/MCC – social and private).
5. Victoria Point – Empiric Student.
6. Brook Hall – Unite student accommodation.
7. Q3 - student accommodation.
8. Travel Lodge (hotel).
9. Nick Everton House (Sanctuary Students).
10. Sam Properties - student accommodation.
11. Manchester Gardens & Daisy Bank (IQ student accommodation)
12. Wilmslow Park (IQ Students)
13. City Labs Phases 1
14. Victoria Baths (swimming pools).
15. Coniston Hall, Whitworth Park & Dalton Ellis (University of Manchester
student accommodation).
OPEN - Phase 2
A. Octagon House Data Centre (2MWe).
B. St Chrysostom’s Primary school.
C. Heineken Brewery – Hulme
D. Sanctuary, Denmark Rd - student
E. Whitworth Gallery (Art Gallery)
F. Elizabeth Gaskell site (proposed commercial development)
G. City Labs Phases II ,III & IV
Ongoing Stakeholder Engagement
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5
6
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9
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14
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15B
15A
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9. Stakeholder Engagement Methodology
There are several steps required and obstacles to overcome, to fully engage with potential off-takers. Typically, following initial contact,
the process soon segues into an explanation to dispel the myths and misconceptions surrounding heat networks, the associated lack of
pricing control and the ability of the Network Operator to maintain resilience and guarantee continuity of supply.
Following an invitation to positively engage, the below process usually ensues:-
• In depth, physical site surveys, accompanied by historic data analysis and energy consumption profiling, for heat, electricity and cooling over the site/estate.
• Physical infrastructure audit, scheduling all existing plant and equipment, its location on site, age, capacity, interfaces and connections. The operating efficiencies, if available ,and
any “backlog maintenance schedule” , together with any planned equipment replacement strategies.
• Existing on-site renewable technologies and plans for such.
• Current heating fuel type, historic costs (for gas and electricity) and duration of supply contract for each.
• Resilience and back-up requirements (on site).
• Future energy strategy, consumption predictions (to accommodate potential increase in service demands).
• Examine future stakeholder options for “energy strategy” with Risk Assessment and benefit analysis. Sensitivity analysis of each option, in comparison to ”do-nothing”, compared
with connection to the OPEN.
Following completion of the above (which remains without obligation on the Stakeholder) MEPL submits a draft appraisal to each, broadly setting out a methodology to connect to the
OPEN, together with a set of achievable outputs/objectives that the Stakeholder it is capable of benefiting from, by it connecting to the OPEN. These are referred to as the
“Deliverables” and broadly cover : -
• Reduction in annual energy cost, combined with a guaranteed Energy Price Differential, compared to agreed reference benchmarks. For the life of the Supply Agreement.
• Carbon emission reduction targets.
• Reductions, both in Capex and on-site maintenance costs.
When the Stakeholder agrees, a Memorandum of Understanding (“MoU”) is be entered into between the parties. The purpose of the MoU is to detail the undertakings, obligations and
exchange of information, required between Stakeholders and MEPL to work together, within a strictly observed time-schedule, to enable the Stakeholder to consider a Detailed Proposal
from MEPL (including a Works Programme and Timeline, with a “go-live” date), and as appropriate, formally approve and commit to contractual obligations (a Supply Agreement) that
satisfy the agreed commercial objectives (within a tariff and pricing structure), with fully quantified Deliverables.
This enables MEPL (within the comfort of the MoU) to develop a bespoke physical engineering solution and long-term continuity
of supply strategy, together with an accompanying financial and pricing structure bespoke for each off-taker, which is then embodied
into a Detailed Proposal, capable of being incorporated in a Business Case and then into the Supply Agreement.

10. ENERGY PRICE DIFFERENTIAL, GUARANTEE & BENCHMARKING
What MEPL will do
• Design a bespoke solution that delivers:
• The Deliverables and other project specific requirements
for incorporation into End-User Supply Agreement
• Provide all necessary information to allow the
development of an options analysis and onto a Business
Case.
• Engage with any third parties where such relationship
exists, for delivery of services, that incorporate electricity
and heating plan, in order to minimise the impact on
such arrangements
• Provide a schedule of connections interfaces required to
maximise the impact and efficiency of the OPEN
Requirements of the Stakeholder
• Work with MEPL within the scope of an MoU to jointly formulate a
Business Case
• Supply the required information and enable access to buildings,
plant, equipment and energy infrastructure.
• Agree the procurement process (with MEPL to support)
• Procure the requisite involvement from any third-party concession
partner
• Assist with the creation of the Detailed Proposal.
• Program the stakeholder internal governance to facilitate Board
approval in order to proceed with the project.
OPEN Stakeholders benefit from a contractual commitment and maintained, year on year
Energy Price Differential, of no less than 10% below an annually referenced Benchmark,
throughout the lifetime of the supply agreement. Individual sites, such as the hospital
campus, are already demonstrating savings as high as 21% on current tariffs.
Further benefits in energy cost reduction, above this will be incorporated on a
performance basis.
This annual Benchmark creates a reference point, to an agreed utility purchasing market
strategy.
• Market testing is undertaken on an open-book basis, comparing an agreed basket of
service providers (e.g. top 6)
• Incorporating Crown Commercial Services (CCS) and ONS historic price levels.
“Carbon reduction for one major off-taker are estimated at 22%, of
present levels.”

11. BENEFITS OF OPEN PARTICIPATION TO STAKEHOLDERS
ü Reduces cost in operation.
ü Mitigates capital expenditure substantially.
ü Externally financed capex and maintenance regime within the Supply Agreement.
ü Capital plant replacement opportunity with reduced or no Capex
ü Better Peak demand management across the Network and for all Stakeholders.
ü Improved resilience and continuity of supply.
ü Efficiency of resource use.
ü Better use of existing assets.
ü Potential to reduce on-site plant size and thus liberate space.
ü Improved monitoring, measurement and reporting function.
ü Reducing the organisation’s carbon footprint.
ü Contributing to carbon reduction targets of 50% by 2025.
ü Opportunity to participate in community-based sustainability project.
ü Visible expression of intent to achieve an organisation’s commitment to a sustainable culture.
ü Improved staff and service user relations, as well as public engagement and recognition.
ü Provides opportunity to participate in economic benefits of RHI’s.
ü Improved flexibility and risk management/allocation.
ü Mitigates risk associated with ageing plant and its replacement.
Manchester Energy Partnership can also offer wider benefits as a consequence of its relationship with ENW Ltd.
Infrastructure replacement at no cost. Improved efficiency and direct savings.

12. PROJECT UPDATE/STATUS - KEY DATES/ACTIVITIES
Completion of Techno-economic Commercialisation Qtr 3 2020
Planning Application for Energy Centre Qtr 3 2020
HNIP (BEIS) feedback end July 2020
MoU’s in place (MUFT and others) end July2020
Stage 3 design complete Early August 2020
Planning Approval for Energy Centre End September 2020
Project Funding Financial Close Qtr 4 2020
Phase 1 -End-user Agreements in place Qtr 4 2020/ Q1 2021
Planning/Consents – Development Framework On-going (with MCC strategic planning
department and highways)
Further Stakeholder engagement (Phase 2) April 2020 – December 2020
Construction Start (Energy Centre) Qtr 4 2020
Construction start (Network Development phase 1) Qtr 1 2021
Heat and Power ON (phase 1) Qtr 2/3 2021
Q3 2020
Completion of Techno-economic study
Q4 2020
Commercialisation of the Project
Q1 2021
Construction Start Date

13. Richard Everton
Chairman
Steve Willock
Managing
Director
Phil Mottershead
Account Director
Jay Patel Energy &
Commercial Analyst
John Runniff
Account Development
Manager
OPEN
MANCHESTER
Mark Williams
Energy Solutions Director
Mike Taylor
Head of Customer Engagement
Jim Hallas
Head of Business Development
CONTACT US ON
0161 282 4528