Procuring for a renewable energy future
ACCESS partner West Suffolk Council (WSC) carried out a procurement exercise at the end of last year. WSC's Peter Chisnall writes about the process and the methods they used.
Back in Autumn 2020, two years into the project we had carried out sufficient research into technologies and we needed to commission some specialist Technology Providers.
The West Suffolk Council (WSC) project involves innovative approaches to trading electricity between businesses, peer to peer trading, with energy and demand-side management. There are regulatory issues involved with the UK Regulator of the gas and electricity markets, OFGEM. We were only aware of one company that is currently doing some peer to peer trading between businesses in the UK, however, they didn’t have an energy and demand-side management capability in house. We have been speaking with this company and separate energy/demand-side management companies for over a year but wanted to engage with the wider market, to see what other companies are out there. We could have run a traditional tender exercise through Suffolk Sourcing (our standard procurement website) but we thought it might be a limited response and we weren’t confident that it would attract the innovative companies that we required.
In July 2020 we were made aware of the UK Knowledge Transfer Network (KTN). They are set up to bring technologies through from conception to market, funded by a Government Agency, Innovate UK. KTN have an Innovation Challenge (IX) process, where organisations are invited to submit against a specification. It is narrowed down to a few companies to attend a pitch session where eventually it is hoped that one organisation meets all the project objectives. We engaged with KTN who were happy to take on the exercise through their Challenge process.
Our procurement manager was made aware of this process and supported this route to market as opposed to our standard procurement tender exercise. So in October 2020, we provided a specification for the peer to peer energy trading and energy demand and management services we required to KTN for the challenge. They advertised it through their network of 60,000 organisations from industry and academia. We also advised the companies that we had been working with and others we thought may be interested to bid through the KTN IX process. We started receiving clarification questions and in October 2020 we held a webinar with KTN. Around 50 participants attended the webinar where they had the opportunity to ask questions and companies were encouraged to work together to submit a joint bid if it strengthened their offer.
As a result, we had 14 submissions. We scored these with KTN against our specification. Our scoring was based on quality, i.e. the ability to meet our challenge, everyone had been informed of the budget available so they had to offer something within that. We were able to narrow it down to four organisations and these organisations were invited to a pitch session in December 2020.
Following the pitch sessions, we carried out scoring against the themes and questions asked. From this, we were able to identify one submission that is a consortium of two organisation, Urban Chain offering a peer to peer energy trading platform and Grid Duck offering energy demand management equipment. The joint submission met all of our project objectives. Ironically they were the two organisations we had researched and were aware of early in our project
We have run this process through our procurement manager and Lees Chartered Accountants, the First Level Controller for the WSC ACCESS project. They are both satisfied that we have carried out a compliant supplier selection exercise equivalent to our standard tender procedure. It has taken us four months to agree on the procurement documents with our legal department who had never had to work with services such as this before. By the end of April, the formal order will be agreed upon.
So that is the journey through our Technology Provider Market Engagement process. We are satisfied that we have been thorough in our search and selection of organisations and this has given us confidence that we have made the correct choice. Now to the implementation phase but that will be the subject of a future article!
Be sure to follow the ACCESS project on social media below to not miss any project updates!