Cost Formula Documentation for Electricity Purchase RFP – City of New Haven

This document is a technical guide explaining cost scoring methodologies used in the City of New Haven's electricity supply procurement. The RFP employs a "Reward Low Cost" evaluation method that allocates up to 30 points based on comparative cost analysis. Under this methodology, the lowest-cost proposal receives 100 percent of available points, while subsequent proposals receive points proportional to their cost relative to the lowest bid. For example, a proposal costing twice the lowest bid receives 50 percent of the available points (15 points), and a proposal costing five times the lowest bid receives 20 percent of available points (6 points). The formula—Lowest Overall Cost divided by Proposal Cost multiplied by available points—ensures that pricing competitiveness directly influences final evaluation scores. Phase 2 price proposals are evaluated using this cost formula following the Phase 1 prequalification process, with the contract structured as a 60-month firm service agreement commencing July 1, 2026, covering approximately 46,000 megawatt-hours of annual electricity consumption across City departments.

The electricity procurement covers block and index pricing for multi-year retail electric supply to municipal accounts throughout the City of New Haven, Connecticut, excluding private or residential service. No specific contract award value or budget range is disclosed in the procurement documentation; however, the estimated annual consumption volume of 46,000 megawatt-hours across the 60-month term provides the basis for cost evaluation. The cost scoring methodology rewards proposals offering the most competitive pricing while allowing flexibility through add/delete provisions permitting portfolio adjustments of up to 10 percent of initial contract volume without repricing or early termination penalties. Qualified suppliers must hold active Connecticut PURA retail supplier licenses, demonstrate experience managing at least 5 megawatts of aggregated municipal load, maintain credit ratings of BBB- or higher, and possess block and index settlement capabilities. All respondents must comply with Connecticut's foreign discriminatory boycott statute for contracts exceeding $100,000 and provide workforce demographic information with their proposals.