Procurement not following regular playbook
CCENTRAL MAINE POWER sent out a press release and started running ads on Thursday questioning why Massachusetts electricity customers should pay an extra $2 billion over 20 years for clean energy.
The Maine utility’s eye-catching question is just one example of how a Massachusetts procurement process for billions of dollars worth of clean energy has taken on a life of its own as it winds down to a final award later this month.
Most government procurements are low-key affairs. An agency puts out a request for proposals, companies submit their bids, and, after a period of internal review, a winner is selected. Most of the process plays out privately behind the scenes.
But the state’s procurement for clean energy has diverged from that playbook. The private, behind-the-scenes bid evaluation process is still taking place, but it’s been accompanied by very public jockeying for position among many of the would-be contenders. Companies have hired publicists, mounted letter-writing campaigns, run advertisements, and tried to distinguish their project from the competition in any way possible.
Part of the reason for the new “outside” approach is the complexity of the procurement. It’s not just a case of opening the bids and selecting the lowest price. Many other factors are involved, including how fast the project can be built, whether it can acquire the necessary permits and regulatory approvals, and what economic benefits will flow to Massachusetts.
The public campaigns of the companies tend to focus on these broader themes. Company officials declined to comment on their strategies, but it appears their goal is to influence the evaluation team directly or indirectly by swaying public opinion – or at least the opinions of key, upper-level policymakers in the Baker administration.
Several company officials also said privately that their public campaigns are designed to raise the political stakes of the procurement, making it difficult, if not impossible, for the evaluation team to play favorites. The bid evaluation team includes representatives from Eversource Energy and National Grid, utilities that have submitted their own bids for the procurement.
Central Maine Power is playing up its low cost, which business groups in Massachusetts have identified as a primary concern with efforts to increase the use of renewable energy. Undoubtedly, Central Maine’s bid goes into great detail on its cost advantages. But the company’s public campaign takes it a step further, emphasizing that the tab for importing hydroelectricity from Quebec into Maine will be significantly less than what two rivals are saying it will cost them to deliver similar amounts of hydropower from Quebec into Vermont and New Hampshire.
“The cost differential includes $650 million in construction savings and hundreds of millions of dollars in subsidy savings-payments that provide no benefits to Bay State utility customers,” Central Maine Power said in its press release.