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Reverse Auction Program

Request for Information and Qualifications

  1. Introduction
    1. Burlington Electric Department (BED) is a department of the City of Burlington (City) serving approximately 20,000 customers. In 2014, BED began to source 100 percent of its electricity from renewable generation including biomass, hydroelectric, wind and solar facilities. As a municipally owned electric utility since 1905, BED recognizes the importance of community-based decisions. Accordingly, BED routinely seeks input from interested parties by offering the opportunity to participate directly in some of the most important decisions about the future of the utility. With a focus on serving the energy needs of our customers in a safe, reliable, affordable and socially responsible manner, BED is committed to helping the City transition toward a net zero energy community across electric, thermal and ground transportation sectors by managing demand, realizing efficiency gains, expanding renewable generation and increasing system resiliency. For more information please refer to our Strategic Direction.
  2. Description
    1. BED is seeking information from interested contractors, customers or third parties about opportunities to reduce or eliminate fossil fuel consumption in the City.
    2. This is a request for information and qualifications only. This RFI/Q is issued solely for information and planning purposes. It does not constitute a Request for Proposal (RFP) or a promise to issue a RFP in the future.  This request for information does not commit BED to contract for any supply or service whatsoever.  Further, BED will not accept unsolicited proposals at this time.  Responders are advised that BED will not pay for any information or administrative costs incurred in preparing a response to this RFI/Q; all costs associated with responding to this RFI/Q will be solely at the interested party's expense.
    3. Responses to this RFI are due no later than November 1, 2018, unless otherwise extended by BED. All submissions shall be provided in MS Word format and Excel spreadsheets. 
      Electronic copies shall be sent to purchasing@burlingtonelectric.com.

      Hard copies may be mailed to:
      BED Purchasing
      585 Pine Street
      Burlington, VT 05401
    4. Depending on the nature of the responses to this request, BED may elect to issue a formal request for proposals or other detailed solicitation to one or several respondents to this RFI/Q.
  3. Background
    1. In 2015, the state of Vermont enacted 30 V.S.A. § 8005 (a)(3) Energy Transformation. The intended purpose of this legislation is to encourage retail electricity providers, including BED, to support projects or programs that reduce fossil fuels consumed by their customers and the emission of greenhouse gases attributable to that consumption. A retail electricity provider may satisfy the energy transformation requirement through additional distributed renewable generation or energy transformation projects or a combination of such generation and projects. As noted above, this RFI/Q concerns only energy transformation projects.
    2. For an energy transformation project to be eligible under state statute, each of the following shall apply:
      1. Over its life, the project shall result in a net reduction in fossil fuel consumed by the retail electricity provider's customer(s) and in the emission of greenhouse gases attributable to that consumption, whether or not the fossil fuel is supplied to the customer(s) by the retail electricity provider.
      2. The project shall meet the need for its goods or services at the lowest present value life cycle cost, including environmental and economic costs.  Evaluation of such projects shall also include an analysis of alternatives that do not increase electricity consumption.
      3. The project shall cost the utility less per MWH equivalent than the applicable alternative compliance payment (ACP) rate. For 2018, the ACP is $61.20. For 2019 and 2020, the ACP is currently expected to be $62.42 and $63.67, respectively. ACP rates are inclusive of BED's costs to administer its Energy Transformation programs.
    3. Pursuant to 30 V.S.A. § 8005 (a)(3) , BED launched a series of Energy Transformation programs in 2017 that are designed to encourage customers to reduce or eliminate fossil fuel consumption and greenhouse gas emissions associated with such consumption. These programs provide incentives to customers toward the purchase of electric buses, electric vehicles, electric bikes, electric vehicle charging equipment and cold climate heat pumps.
  4. Reverse Auction program description
    1. As a means to further catalyze innovative energy solutions, BED proposes to provide performance-based incentives to project developers who can demonstrate that their proposed beneficial electrification project and/or technology can reliably help eliminate or substantially reduce the fossil fuel consumption of BED's customers.
    2. BED also proposes to provide program implementers with performance-based incentives who can effectively demonstrate how they would deliver innovative beneficial electrification services and technologies to BED's customers at costs lower than what BED incurs or would incur to deliver such services. Program related incentives could be used to defray administrative, marketing and other overhead expenses.
    3. Respondents may propose discrete one-off projects at their place of business, home or building or sponsor such project or projects on behalf of a BED customer. Alternatively, respondents may propose programs to deliver measures or services to a wider market segment of BED customers. 
    4. Incentives, if any, are intended to buy down the incremental cost of delivering innovative program services or installing beneficial electrification technologies that can substantially reduce or eliminate fossil fuel consumption in the City. Such incentives, however, shall be capped in accordance to the following schedule:
      Reverse Auction Cap
    5. An incentive bidding tool is described in the Appendix and included separately. Prospective bidders are encouraged to submit per mmBTU bids at the lowest cost to BED possible. As noted, bids in excess of the annual cap (i.e. $4.90 per mmBTU in 2018) will be rejected.
    6. Complete descriptions, including product specifications and use cases, of new beneficial electrification technologies proposed by developers, contractors and/or customers shall be included in this RFI/Q. Each technology, however, will need to be commercially available, as well as have a documented in-the-field performance record or be qualified through the Tier 3 Technical Advisory Group as being eligible for credits.
    7. BED will confer priority status during the evaluation process to project developers and/or program implementers who submit proposals that can reliably use demand control capabilities.
  5. Definitions
    1. Program – a group of related ongoing projects and activities managed in a coordinated manner to obtain a set of benefits that would not be attainable if they were managed individually.
    2. Project – a temporary endeavor undertaken to create a unique product, service or result.
    3. Tier 3 Technical Advisory Group (TAG) – a group consisting of Vermont's electric service providers, Department of Public Service and Vermont Energy Investment Corporation. The TAG is charged with the responsibility of evaluating new technologies capable of offsetting fossil fuel consumption.
    4. BED program manager – an employee of Burlington Electric Department responsible for managing the Reverse Auction program.
    5. MWhe or MWh equivalent – as stipulated under Vermont statute, proposed fossil fuel savings must be converted into a MWh equivalent, which roughly translates into the amount of electricity embodied in a gallon or therm of fossil fuel as measured in mmBTU's.
    6. Incremental costs – represent the difference between the higher upfront capital cost of new technologies (or the delivery of programs/services) and the technologies (or the programs/services) that are considered to be current day standard practice. For example, if a new electric bus costs $700,000 and a standard diesel bus costs $400,000, the incremental capital cost is $300,000.
    7. Installed costs – represent the total installed cost of a project, including upfront capital costs, installation charges and labor, administrative, marketing and other overhead expenses, etc.
    8. Alternative Compliance Payment – Consistent with 30 V.S.A. § 8005 (a)(3), Vermont's retail electricity providers may elect to encourage customers to reduce their fossil fuel consumption or, alternatively, make a payment into the Vermont Clean Energy Fund.
    9. Beneficial Electrification – includes the substitution of fossil fuel powered equipment used by customers with advanced electrically powered technologies.  Such new technologies can save customers money in the long term without any diminution of service, reduce environmental impacts, and provide for opportunities to enable better overall management of the electric grid.
    10. Demand control capabilities – allow for the customer and/or the electric utility to control the electrical power demand of end use technologies on the customer's premise during periods of high system demand for power or when the electric grid is under stress.
  6. Requested Information
    Please provide the following information to receive a copy of a future solicitation:
    1. Business information
      1. Name and type of business
      2. Business address
      3. State of incorporation and date of incorporation
      4. Principal owners and key staff
      5. Number of employees
      6. Description of relevant project/program expertise and experience
      7. Description of similar projects and programs
      8. Proof of insurance
      9. Ability to comply with the City's livable wage requirements
    2. Customer information
      1. For Projects, the name and address of customer where the proposed project will be installed and operated
      2. For Programs, a description of the target market (e.g. residential single family owners, small commercial customers, larger commercial customers, etc.) and potential size of the target market(s).
    3. Project or program information
      1. Highlight the overarching objective(s) of the proposed project/program;
      2. Provide sufficient details for BED to understand the nature of the project/program;
      3. Provide technical specifications of existing customer equipment and operations
      4. Provide technical and product specifications of the proposed technology that the project/program seeks to install;
      5. Describe what success looks like for the customer, BED and the community;
      6. Identify barriers and risks to successful completion of the project/program;
      7. Estimate fossil fuel savings  expressed in gallons of fuel or therms of gas displaced and mmBTUs;
      8. Estimate reductions in GHG emissions associated with expected fossil fuel savings;
      9. Provide preliminary total project cost estimates and project/program timeline, including for example, engineering, product specification, administrative, permitting, shipping and travel (etc.) costs, as well as the incentive buy-down needed to render the project/program cost competitive with existing standard (fossil fuel) technologies;
      10. Provide an estimate of the incremental cost of the proposed project/program;
      11. Separately list funding sources including BED incentives – if any; and,
  7. Evaluation
    1. RFI/Q submittals will be evaluated based on a number of factors including but not limited to the following:
      1. Quality of the response;
      2. Thoroughness of the response;
      3. Technology assessments;
      4. Estimated customer economics, including ongoing operating costs;
      5. Estimated costs to BED such as incentives, program and administrative costs;
      6. Qualifications and experience of  respondents;
      7. Measures with savings estimates already qualified through the Tier 3/TAG process
      8. Local sourcing of work force
  8. Questions
    1. Questions regarding this announcement shall be submitted on or before Friday, September 28, 2018 in writing by email to the BED program manager at purchasing@burlingtonelectric.com
    2. Answers to questions will be posted on BED's website.
    3. At BED's discretion, BED may convene a meeting to respond to questions and/or concerns about the proposed Reverse Auction program.
  9. Amendment or Cancellation
    1. BED reserves the right to amend or cancel this RFI/Q at any time if the best interest of BED such action.
  10. Vendor presentation of Supporting Evidence/Surety
    1. Vendors are requested to be prepared to provide any evidence of experience, performance ability, and/or financial surety that BED deems necessary to fully establish the performance capabilities represented in this request.
  11. BED Rights
    1. BED reserves the right to accept or reject any or all submittals received in response to this RFi/Q or to take other action consistent with the best interest of BED.  BED reserves the right to negotiate separately with any source to serve the best interest of BED. EXCEPTIONS TO THIS REQUEST SHALL BE BY WRITTEN NOTIFICATION ON THE AWARDED P.O. – IF ANY - IN ORDER TO BE BINDING.  ALL SUBMITTALS ASSOCIATED WITH THIS REQUEST BECOME THE PROPERTY OF BURLINGTON ELECTRIC DEPARTMENT.  AFTER THE AWARDING OF THE CONTRACT – IF ANY - TO THE SUCCESSFUL BIDDER, ALL BIDS ARE OPEN FOR PUBLIC VIEWING.

 

Appendix

Below is the link to BED's bidding tool. The tool is designed to assist project/program proponents with determining their mmBTU bid and total project incentive.

Download Reverse Auction Bidding Tool

The table below is provided for illustrative purposes only.

Chart

When you open the Excel spreadsheet follow the following steps:

  1. This cell includes a drop down list of fossil fuels. Select the fuel that your proposed project will displace.
  2. Depending on the selection of fuel in step 1, the tool automatically completes the mmBTU content.
  3. Input the amount of fossil fuel that your proposed project will displace in gallons of fuel or therms of natural gas.
  4. The spreadsheet will automatically populate the amount of annual savings in mmBTUs.
  5. Input the measure life of the proposed technology.
  6. Input your desired mmBTU bid. Note that bids in excess of the annual cap (i.e. $4.90 per mmBTU for 2018) will be rejected.
  7. The total proposed project incentive will auto-populate. This product is the result of the following inputs: Annual mmBTU savings X Measure lifetime X mmBTU bid.
  8. Input your total project cost
  9. The proposed incentive as a % of total project cost will auto-populate.