Municipality buys Local Energy
Buying close to home means that the local community profits. Funds don’t leak away to large power suppliers elsewhere and are available to invest in more sustainability measures in the region.
European procurement laws
However, buying local isn’t always easy, considering the European procurement laws. In Noordenveld the sizeable order of 3 million kilowatt/hour of electricity that was needed, meant that all suppliers - big and small – had to be offered the opportunity to submit a tender. Small-scale suppliers miss the capacity to deliver that amount of electricity and the administrative know-how for such a tendering process. Moreover, according to European regulations, electing local suppliers is discriminatory.
The package bid
Noordenveld found an innovative financing solution - the package bid!
The package-bid is a Dutch regulation (percelenregeling) that allows corporate organizations to split their procurement into different packages. By doing this, a maximum of 20% of the total bid can be left out of the European bidding procedure – up to €1,000,000 for services and €80,000 for products.
While not an obvious solution, adapting to the possibilities within this regulation allowed the Municipality of Noordenveld to favour a supplier of choice. The local energy cooperative’s offer was under the regulatory limit, the supplier didn’t have to submit a tender for the whole contract or satisfy all the extra administrative demands involved.
The package-bid regulation isn’t complicated and can be easily adopted by other municipalities in The Netherlands. This example of local empowerment from Noordenveld may also serve as an inspiration for other Stronghouse partners and stakeholders. By cooperating closely, thinking out of the box and using alternative approaches to financing green initiatives, the municipality supports the local economy, strengthens the community and raises more awareness amongst inhabitants about the use of sustainable energy.
Watch the explanatory film (with English subtitles)
Read about the package-bid (Dutch): De ruimte van de percelenregeling | PIANOo - Expertisecentrum Aanbesteden
With thanks to Marjolein Veenstra and Jaap Lobbezoo (Municipality of Noordenveld)