Finance and Performance Committee

Late Item























Susan Baty (Chairperson)

Jim Jefferies (Deputy Chairperson)

Grant Smith (The Mayor)

Brent Barrett

Lorna Johnson

Rachel Bowen

Duncan McCann

Adrian Broad

Karen Naylor

Gabrielle Bundy-Cooke

Bruno Petrenas

Vaughan Dennison

Aleisha Rutherford

Lew Findlay QSM

Tangi Utikere

Leonie Hapeta













Finance and Performance Committee MEETING


19 June 2017





Consideration of the items is subject to the provisions of the urgent item clause, pursuant to Section 46A(7) of the Local Government Official Information and Meetings Act 1987.

The Chairperson recommends that the item be considered as:

-          The item was not available at the time the Agenda was circulated; and

-          Consideration of the items is a matter of urgency, requiring a decision without delay to enable the Council to meet deadlines, finaslise decisions and receive information within agreed timeframes.

16.       Programme 1086 LED street light upgrade                                                       Page 5

Report, dated 1 June 2017 from the Road Planning Team Leader, David Lane.    








TO:                                Finance and Performance Committee

MEETING DATE:           19 June 2017

TITLE:                            Programme 1086 LED street light upgrade

DATE:                            1 June 2017

AUTHOR/S:                   David Lane, Road Planning Team Leader, City Networks




1.   That Council authorise continuation of compliant LED street light upgrades envisaged under Programme 1086 and approve conversion of street lights in the phase two part of the programme in compliant streets;

2.   That Council note that a further report will be presented discussing options for streets that are non-compliant, with recommendations for prioritised financial programmes to address that non-compliance.




Summary of options analysis for


Problem or Opportunity

Programme 1086 provides for conversion of existing sodium vapour street light luminaires to new LED technology. In response to submissions to the 2017/18 Annual Budget Council has requested further work to investigate the programme of upgrading street lights to LED where they do not meet current standards. Delaying of Programme 1086 has implications that might jeopardise approved funding or disadvantage Council in terms of securing a contractor to undertake the work. This report seeks approval to continue the tender process for upgrading compliant streets to LED while further investigation and prioritisation can be completed for sub-standard locations.


Council could approve tendering of compliant streets as originally planned.

Community Views

A number of complaints have been received and these are being investigated for a later report that will identify sub-standard parts of the network. No submissions appear to seek a delay to the installation programme on streets where standards are met or exceeded.


Improved prospect of delivering programme in timely manner that ensures available funding is fully utilised.


No significant risks


Installation of a substantial proportion of the network that is compliant will ensure 85% funding subsidy is accessed.


Council could decline tendering until it has a better understanding of the extent of non-compliance on the network.

Community Views

It is not yet clear whether submissions to Council are based on aesthetic considerations, environmental considerations such as proximity to trees or arise from other concerns about sub-standard or non-compliant installations.


No benefit if Council loses access to approved funding. 


Substantial risk that Council fails to secure a contractor as other Councils are now accelerating their programmes.


Approved NZTA funding could be lost – estimated remaining expenditure of $4.0-$4.2 million, of which NZTA share is $3.5 million. Refer clause 4.2 in report.

Contribution of Recommended Option to Council’s Strategic Direction

Street lights contribute to city goal to be a socially and environmentally sustainable city. Street lights provide a safer environment for people to go about their business and the LED upgrade programme has environmental benefits in terms of reduced energy use over many years.


Rationale for the recommendations

1.         Overview of the problem or opportunity

1.1       Council received submissions during the 2017/18 Annual Budget process which raised concerns over new LED street lights conversions. At the time of writing this report Programme 1086 is 90% complete for phase one installation, which involves installation in P-Category locations, mostly residential streets where pedestrian movement is the primary driver for street lighting. Phase two implementation targets V-Category locations, primarily vehicle movement streets such as arterial and collector road networks that experience the bulk of traffic movement.

1.2       In response to submissions Council has placed a hold on implementation of phase two contracts while further work on sub-standard or non-compliant locations is investigated and prioritised. The delay has potential to jeopardise delivery of the phase two programme and could result in loss of access to the enhanced 85% funding subsidy approved by NZTA. A substantial proportion of the phase two network is however compliant with standards (AS/NZS 1158) in terms of height and location of street light columns. Accordingly if the current luminaires are replaced with LED luminaires, the overall street lighting facilities at these locations will be compliant with the standard.

1.3       That being the case, it is recommended under this report that Council proceed with tendering for that part of the phase two locations which are compliant with current standards. 

2.         Background and previous council decisions

2.1       The Committee of Council meeting of 25th May 2017 considering submissions to the Annual Budget 2017/18 passed the following resolution 3(b):

2.1.1    That Programmes 1086 - Street Light Upgrade LEDs and 74 - Street Light Replacements allow staff to consider appropriate LED installation to mitigate issues raised during the submission process and to a report back to Council to ensure that all standards are met before lantern conversion.

2.2       Programme 1086 is an approved budget with an expected cost in excess of $6 million once fully implemented. It involves replacement of more than 5,000 street light luminaires and is a programme that is eligible for NZTA funding subsidy. In a General Circular dated 6th March 2017, NZTA announced change to funding rules for LED street light conversion programmes, increasing the subsidy rate from 51% to an enhanced funding rate of 85%. This rate applies to the end of the 2017/18 financial year and is not yet approved for subsequent financial years.

2.3       The enhanced funding contribution has increased demand for street light programmes and many Councils nationally are now seeking to expedite implementation. This has created a situation where supply contracts for LED luminaires are coming under increased pressure and availability of contracting staff is scarce.

2.4       Council’s programme for LED street light installation has two phases and the first phase, predominantly the residential streets, is almost complete. The first supply tranche of the second phase, the major roads, is at the stage where the design work is almost completed and contracts for supply of luminaires are ready to go out to the market. Council’s moratorium has created a significant risk for Council that a delay to award of supply contracts might affect both the availability of suitable luminaires and the ability to appoint a suitable contractor for installation work. Feedback from the contractor for the current contract, a local firm, is that there is considerable difficulty in attracting qualified staff for the work available. There is a risk that the contractor will seek other contract work from other Councils and this may impose a delay on physical works that threatens the funding deadline established by NZTA.

2.5       Submissions to the 2017/18 Annual Budget have raised concerns about the quality of light output from LED luminaires. These concerns are being investigated and will be the subject of a later report and recommendations to Council.

2.6       Issues of non-compliance in street lighting can arise from a number of circumstances. This can include the height of the pole mounting, the length of the outreach arms, the placement of the pole relative to other road features, including trees, or the angle at which the luminaire directs light at the road. In some cases there are too few poles and the spacing of poles needs to be addressed. In most cases the installation of new poles or additional poles addresses the problem. Delay of the LED luminaire conversion programme until after design and report to Council is completed, as envisaged in the Council’s resolution, carries significant risk given that about 80% of the network is expected to be compliant and can be converted and meet standards.

2.7       It should also be noted it is possible to fit a compliant luminaire in a non-compliant pole mounting. This provides future proofing and means that when the pole is eventually replaced the street light will be fully compliant.

2.8       It is suggested that supply and installation contracts for compliant streets can still be accommodated while the extent of non-compliance is investigated and prioritised. Addressing non-compliance will require additional design work not anticipated in the current funding programme and it will take time to complete the designs and prepare the necessary report to Council.

2.9       Enquiries with NZTA have confirmed that the current approved programme is limited to LED luminaire conversion only. It does not cover improvement activity such as replacement or additional poles to address existing sub-standard mounting height or spacing. This work needs separate programme approval and could then possibly be subject to a 51% funding subsidy. At this stage officers expect to present that report around October 2017.

2.10     In due course Council will receive a report with recommendations that address the non-compliant areas of the network. This report suggests proceeding with the first tranche of the phase two programme as planned where this can be achieved on roads that meet current standards. The later report will include a recommendation regarding Programme 74, which has an annual budget of $135k. It seems likely that a revised funding programme for an accelerated programme of street light upgrading will be needed and this could be included for consideration in the 2018-28 Ten Year Plan. 

3.         Description of options

3.1       Council could approve the continued implementation of Programme 1086 in order to ensure that as much conversion activity as possible is achieved before the expiration of the approved funding.

3.2       Council could decline to approve implementation of Programme 1086 until such time as it has a better understanding of non-compliance on the network.

4.         Analysis of options

4.1       Design work for V-Category is well advanced and supply contracts can be issued in the near future. While the work is not yet completed the 5 zones that are designed (out of a total 12) have shown non-compliance rates ranging from 10% to 19% with an average of 14% non-compliance. Two other zones that are well progressed in design have higher rates of non-compliance, in older, more established locations. In some cases the streets in the zones have only one or two non-compliant poles, while in some other locations longer stretches of road with multiple non-compliant poles exist. It is expected that a significant proportion of the roads in the zones will be compliant. It is possible to apply construction contracts selectively to ensure that non-compliant locations are deferred until there is a better understanding of the problem and the matter reported back to Council as per resolution 3(b) – reference clause 2.1.1 in this report.

4.2       The principal risk to Council if work on Programme 1086 is delayed is financial. The P-category lights in phase one is almost completed at a cost of $2.1 million. The remaining work (V-Category) is estimated to cost between $4.0 and $4.2 million. NZTA has approved a provisional budget for the total programme of $6.027 million, of which $5.123 million is the total subsidy. Final costs will not be known until supply and install contracts are in place. The primary financial risk is to the remaining $4 million of work, for which the NZTA share is $3.4 million.

4.3       This approved funding is available to 30 June 2018 with an extension available to the end of 2018 for committed contracts. NZTA has given no commitment to funding at that level beyond 30th June 2018. NZTA’s 6 March 2017 policy change has had the immediate impact of inducing demand from other Councils and decisions to accelerate conversion programmes are ramping up. This Council’s programme is well advanced compared to many other Councils and there is potential to lose that advantage.

4.4       If 80% of the V-Category network is compliant as expected and able to be converted, it would reduce the risk to Council significantly. Installation of the compliant part of the network would see approximately $3.2 million of the programme delivered and $2.72 million of subsidy received. It may also still be possible to achieve delivery of the remaining 20% of the network before the NZTA imposed deadline, but that will depend on a further report to Council and what decisions are taken at a later date regarding non-compliant infrastructure.

4.5       Other risks relate to securing a supply of luminaires and engagement of a suitable contractor. The phase one installation contract received only one contract bid, from a local supplier. It is expected that contractor will also bid for the phase two work, but there is a risk emerging that other Councils will seek to accelerate LED installation work and contractor availability will change. This suggests that it is prudent to tender as much work as possible as soon as possible, as the NZTA funding increase will stimulate additional local demand for work to be completed.

4.6       For these reasons the preferred option is for Council to authorise supply and installation contracts for LED conversions on compliant infrastructure. The issues relating to non-compliant infrastructure will be investigated and costs estimated to enable decisions on funding an accelerated pole renewal programme.

5.         Conclusion

5.1       Council has committed through its annual plan to an ambitious programme of upgrading its street lights to more cost effective LED technology. Plans for implementation of the LED luminaire conversion programme are well advanced and NZTA funding is approved for the full cost of the programme. Some concerns have been expressed through submissions that appear to relate to non-compliant infrastructure and these issues are being investigated so that better informed decisions can be made on a programme for upgrading non-compliant infrastructure.

5.2       This report recognises the significant concerns of the community about sub-standard infrastructure. The majority of the city’s infrastructure is, however, fully compliant and it does not appear prudent to forgo the generous 85% financial subsidy that is available for upgrading this infrastructure. This report accordingly recommends that Council authorise issue of supply and installation contracts for compliant infrastructure.


6.         Next actions

6.1       If approved Council staff will complete supply contracts and tender installation contracts allowing the first tranche of the phase two LED conversion programme to continue on compliant streets.

6.2       A report will be presented to Council by October 2017 that deals with non-compliant streets with a prioritised list of proposed physical works. Adjustments to financial programmes should be anticipated if an accelerated upgrading programme is envisaged.

7.         Outline of community engagement process

7.1       Engagement has been completed during the Annual Budget process.

Compliance and administration



Does the Committee have delegated authority to decide?

If Yes quote relevant clause(s) from Delegations Manual


Are the decisions significant?


If they are significant do they affect land or a body of water?


Can this decision only be made through a 10 Year Plan?


Does this decision require consultation through the Special Consultative procedure?


Is there funding in the current Annual Plan for these actions?


Are the recommendations inconsistent with any of Council’s policies or plans?







David Lane

Road Planning Team Leader