RFQ26006788 Solicitation Specifications.pdf

RFQ26006788

SOLICITATION SPECIFICATIONS

MPA 623 NATURAL GAS SUPPLY SERVICE, REQUEST FOR PRICING

SECTION 1. BACKGROUND

The State of Rhode Island’s Department of Administration (DOA), Division of Purchases (the “Division” or the “State”) on behalf of Executive and Judicial Branches of Rhode Island, Cities and Towns and other State entities is soliciting bids from qualified suppliers of natural gas supply service to provide firm supply of natural gas to the accounts presented in Exhibit 1 to this Request for Quote (RFQ). The Rhode Island Public Utilities Commission has approved Rhode Island Energy’s tariffs to allow accounts that qualify for medium and large rate schedule to transport their own gas through the Rhode Island Energy system. The State has the attached listing of meters/accounts that qualify for firm transportation under the revised tariff. The purpose of this pricing request is to solicit, evaluate, and select, through a competitive bidding process, a source of guaranteed, firm and reliable gas supply for the firm requirement accounts for purchases commencing on January 1, 2027 or as otherwise noted in Exhibit 1 (Master Account List) and/or Exhibit 2 (Pricing Table and Requirements).

List of Participating Entities included in RFQ Below is a listing of the Participating Entities in this RFQ process, along with an approximate number of natural gas accounts for each Participating Entity. Each Participating Entity is to be billed directly by the winning supplier.

Participating Entity Non-State Accounts

State-Billed Accounts Total

State of Rhode Island 136 136 Community College of Rhode Island 6 6 Judiciary 8 8 Rhode Island College 19 19

Chariho Schools 3 3 Narragansett Bay Commission 17 17 North Providence Schools 9 9 North Providence, Town of 16 16 Providence Schools 48 48

RIPTA 13 13

Town of Barrington 4 4 Town of North Kingstown 25 25 Town of South Kingstown 23 23 Town of South Kingstown, Schools Dept. 6 6 Town of Warren 15 15 Town of Westerly 22 22 University of Rhode Island 34 34 Grand Total 235 169 404

For reference, the total annual consumption for all accounts included in this solicitation is approximately 623,000 dekatherms (Dth). Respondents to this RFQ are expected to retrieve necessary data directly from Rhode Island Energy in order to confirm historical volumes and related usage requirements.

Note that the Narragansett Bay Commission (NBC) has seventeen (17) accounts included in this RFP. One (1) of these is an FT-1 account that has a dedicated line item for pricing; monthly contract volumes for this account are provided in Exhibit 1.

SECTION 2: ACQUISITION METHOD

The Pricing Form contained in Exhibit 2 is to be utilized for pricing. The State will be seeking all-inclusive, fixed rate pricing to the City Gate. Further details and pricing requirements are presented in Exhibit 2 to this solicitation.

All bids submitted on the day of the pricing event are considered binding. Bids will only be considered on the date that they are received. Once a price quote is accepted and awarded, no further quotes will be considered.

It is the intent of the State to award a contract to a single bidder on the basis of “best value” to the State. The State will consider items such as supply term and price when determining the “best value.” The State reserves the right to reject any and all quotes received if it is determined that it is in the best interest of the State.

The State will issue a Notice of Award by electronic mail to the selected bidder on behalf of all agencies listed herein. Notice of Award is official and binding, and the selected bidder will receive an emailed letter stating that the State has accepted its price no later than the time and date listed in the Procurement Schedule. The official documents (i.e., Purchase Order) will be issued and distributed a few days after the pricing event.

Alternate bids (bids based on terms or conditions different than those established by this Contract) are not permitted; all prices submitted shall be in accordance with the provisions of this Contract.

SECTION 3: SCOPE OF WORK AND REQUIREMENTS

Background on State/Local Accounts This solicitation is for the State’s firm gas requirements that qualify as transportation customers on the Rhode Island Energy system. The firm accounts have a maximum daily quantity represented in Dth/Day and typically serve the heating, hot water, and food service requirements of the many buildings that they represent. Each meter will be served by a separate transportation contract with Rhode Island Energy and the State. For State accounts, all invoices will be sent to a single location for payment. To support and facilitate billing and payment, the State requests the supplier to submit a single Summary invoice on a monthly basis (in addition to the monthly bill for each account). For all other Participating Entities in this process, the winning Supplier must invoice each of those Entities directly. Account numbers for each Entity are provided in Exhibit

1. Accounts not listed but qualifying may be added to these requirements with the consent and approval of the winning supplier and the State (see appropriate section of this solicitation for additional information regarding adding accounts).

Gas Supply Requirements This solicitation is being issued to solicit and procure an alternative gas supply to meet a portion of the State’s total firm requirements at its many Department of Administration buildings, Courts systems, and other State accounts. The State’s annual requirements for the firm sales accounts can be obtained through Rhode Island Energy and is also included as an attachment to this solicitation. In order to retrieve data from the utility, a Letter of Authorization (LOA) will be provided to bidders upon request. If there are any issues with securing necessary data from the utility, please contact the State immediately for support.

Gas requirements at the listed locations are temperature sensitive. Rhode Island Energy offers three services to these accounts: firm sales service, FT-1, and FT-2. Under FT-1 and FT-2 rates, Rhode Island Energy provides local transportation to gas suppliers who deliver gas to the City Gate. Under the terms of the Rhode Island Energy firm sales rate schedule, the State does not need to make daily nomination of its requirements and is not subject to any daily imbalance penalties or overrun penalties. However, under the Rhode Island Energy FT-1 transportation tariff, shippers are required to make daily nominations and are subject to daily imbalance penalties, monthly cashout provisions, and overrun charges. A supplemental balancing service is available to FT-1 customers who need more balancing tolerance levels than the standard 10% daily level built into the FT-1 tariff. With the supplemental balancing service, FT-1 customers may experience daily imbalance penalties. Rhode Island Energy FT-2 service does not require daily metering and imbalance service be built into the transportation rate schedule.

For existing FT-1 accounts, telemetry is currently in place and the required phone lines and associated costs have been borne by the customer. The winning supplier will not be responsible for these costs. If a supplier experiences any issues with the equipment and/or phone line, it is incumbent upon them to bring it to the attention of the State and/or participating entity. In addition, no switching of accounts from FT-2 to FT-1 is proposed in the solicitation and as such, no new telemetry or phone line costs will be incurred.

For all accounts designated as FT-1 transportation, be aware that your transportation price per Dekatherm needs to include the following:

• All balancing service charges imposed by Rhode Island Energy.

• Any and all imbalance penalties and cashouts imposed by Rhode Island Energy.

• Present capacity release charges and/or any increases in capacity release assignments or charges by Rhode Island Energy during the contract period.

For all accounts designated as FT-2 transportation, be aware that your transportation price per Dth needs to include the following:

• Present capacity release charges and/or any increases in capacity release assignments or charges by Rhode Island Energy during the contract.

• Present storage charges and/or increases in storage assignment or charges by Rhode Island Energy during the contract period.

• Present peaking capacity charge (Liquid Natural Gas) and/or any increase in peaking capacity release assignment or charges by Rhode Island Energy during the contract period.

The successful bidder will be required to provide administrative services, acting as an agent for the State, and provide services such as monitoring and managing the daily deliveries of gas for the system. This will include making all the necessary nominations on the respective interstate pipelines and on the Rhode Island Energy system, and daily monitoring of accounts, balancing, imbalance trading, and invoice consolidation. The bidder will be required to provide and/or pay for any fuel shrinkage, imbalance penalties, overrun charges, cashout charges, and other charges related to the delivery of gas to the State’s accounts. The State is subject to the State’s Gross Revenue Tax (GRT). The State expects to sign an agency agreement with the bidder to authorize the bidder to make nominations on behalf of the State. The bidder will be required to absorb any imbalance fees or penalties associated with their failure to deliver or manage the daily flow of gas.

Sample agreements must be included with bid response. The State of Rhode Island may prefer invoice consolidation to be provided by the transporter. Invoice consolidation would include the cost of transportation provided by our local distribution company (LDC) and any other incidental costs associated with transporting which would normally be included in billing by the LDC. A bidder must be able to provide invoice by meter or account number. A bidder must provide a sample invoice with bid response showing billing format.

Duration of Agreement The State is seeking price proposals for gas supply for multiple durations, ranging from 12-36 months. The Pricing Form contained in Exhibit 2 includes the terms being requested. Any awarded contract will include the potential for two (2) renewals each up to twelve (12) months in length.

Proposed Quantity The quantity required for this solicitation is the full requirements of the accounts specified in this solicitation under Exhibit 1 plus any added accounts (see section below entitled Adding Accounts to this Contract).

Technical Proposal Requirements There is no Technical Proposal due as part of this solicitation. Technical Proposals have already been submitted. Only those suppliers of natural gas that have been approved as a qualified provider by the State of Rhode Island are eligible to participate in this solicitation. Only those companies that are State-qualified will receive this solicitation.

Rights of the Purchaser

The State reserves the right to reject all bids and to terminate the solicitation at its sole discretion.

The issuance of the solicitation in no way obligates the State to negotiate a contract with any bidder. The State reserves the right to negotiate provisions of the contract, which can provide benefits to the State. The State shall be under no obligation to accept the lowest cost or highest scoring proposal or to return any proposal or materials submitted in response to this solicitation.

Liquidated Damages Provision In order to ensure that the State’s firm gas supplier requirements are met for the duration of the contract term, bidders entering into a contract with the State as a result of this solicitation process will be required to warrant that they have or will acquire sufficient natural gas and transportation contracts to perform their firm obligations under this contract. Furthermore, the supplier must agree to pay all fees or penalties associated with their failure to deliver the proper quantities of gas on a daily basis. It should be assumed that any failure to deliver firm supplies would result in substantial penalties and very high replacement costs. The State will require a liquidated damages provision in the contract, which will require such bidders to pay for replacement gas costs and other damages including, without limitation, additional transportation charges in the event of a failure to deliver.

In the case of any Termination or Cancellation, the State or Participating Entity shall, within forty-five (45) days of the effective date of Termination or Cancellation, reimburse the Contractor for its Performance rendered and accepted by the State or Participating Entity, in addition to all actual and reasonable costs incurred after Termination or Cancellation in completing those portions of the Performance which the Contractor was required to complete by the notice. For instance, the damages a Contractor would incur due to loss in market value of locked-in future quantities would generally be considered a “reasonable cost.” However, the Contractor is not entitled to receive, and the State or Participating Entity is not obligated to tender to the Contractor, any payments for anticipated or lost profits or indirect damages.

SPECIFICATIONS

DELIVERY POINT

The “Delivery Point” shall be that point on the distribution system at which the LDC takes possession and ownership of the natural gas supply (City Gate).

RISK OF LOSS

Risk of loss of natural gas supplied under this contract shall remain with the selected bidder(s) until, and shall pass to the facility only upon, delivery of said natural gas to the Delivery Point for each facility account.

PROCUREMENT FEE

The selected bidder hereby agrees to the inclusion of a procurement fee on all accounts included in this contract that will be included in the selected bidder’s price offers. The fee for any contract award is $0.03 per DTH for all usage billed. This fee shall be paid directly to NORESCO LLC by the selected bidder.

NOMINATING AND BALANCING RESPONSIBILITIES

It is the selected bidder’s responsibility to conduct all required nominations on behalf of the facilities specified in Exhibit 1. The selected bidder shall be fully familiar with the imbalance, shrinkage/line loss, and policies of the LDC. Any costs and/or penalties associated with these items will be borne by the selected bidder.

LOAD REDUCTION

The State will not be penalized in any way for pursuing energy conservation projects or participating in programs that reduce load requirements.

Please note that the State is currently engaged in energy conservation/load reduction projects and anticipates that there will be more projects in the future. Exhibit 1 indicates the accounts that will be priced with unlimited swing. The State will attempt to notify the selected supplier if an energy conservation project could potentially and permanently impact future usage in a material fashion.

FORCE MAJEURE

Except for the State’s obligation to pay the winning supplier for natural gas delivered, if either party is rendered unable, wholly or in part, to perform its obligations under this Agreement due to Force Majeure, to the extent affected by the Force Majeure the obligations of each party will be suspended for the duration of such Force Majeure. A party claiming Force Majeure shall promptly notify the other party by telephone and confirm within a reasonable period of time by a written notice describing in reasonable detail the nature, and estimated duration, of such Force Majeure. The Force Majeure will, so far as possible, be remedied with all reasonable dispatch. If the duration of the Force Majeure event exceeds twenty (20) days, the party not claiming Force Majeure may terminate the affected portions of this Agreement with ten (10) days written notice to the other party.

ENROLLMENT

The selected bidder will be responsible for switching accounts from the applicable LDC (or third-party contractor) to the selected bidder and fulfilling any obligations with the LDC to that end. If the selected bidder fails to switch accounts within the terms specified in this contract, penalties may be assessed based on the difference between the applicable LDC Basic Service Rate and the rate that would have been charged by the selected bidder (i.e. Basis plus Commodity) for the period of time the account remained on LDC service. Additionally, the selected bidder will be required to provide an enrollment report detailing the status of each account to be enrolled. The enrollment report is due by the time and date specified in the Procurement Schedule.

PAYMENT AND BILLING

For State accounts, the selected bidder will submit all monthly invoices to a single location for payment. To facilitate billing and payment, the State requests the supplier submit a single summary invoice. For any eligible entities participating in the procurement, the selected bidder will bill each meter or account monthly by participant. Payment terms are governed by the State of Rhode Island General Conditions of Purchase, which can be found at https://ridop.ri.gov/about-us/procurement-statutes-and-regulations The selected bidder shall provide the State with a Monthly Usage and Cost Summary which will accompany the summary invoice. The report will include a summary of usage and cost for each account awarded to the bidder.

DEFAULT AND CANCELLATION

Default and cancellation language is contained in the State Of Rhode Island General Conditions of Purchase, which can be found at https://ridop.ri.gov/about-us/procurement-statutes-and-regulations .

ADDING ACCOUNTS TO THIS CONTRACT

For a variety of reasons, it is possible that certain authorized facilities eligible to purchase natural gas under this contract will not be included in Exhibit 1. The State shall provide an estimate of the facility’s natural gas requirements and the selected bidder will be required to provide a price for the new account(s) under the same Terms and Conditions as this Contract. The State will provide this information at least thirty (30) days prior to the desired flow date. The selected bidder will have ten (10) days to provide a price for the new accounts. The State will have the ability to decline the price if it is not in the State’s best interest. Adding facilities shall be accomplished through a bilateral modification of the contract.

If the LDC deems appropriate to change an account number for a facility during the term of this Contract, this will not be considered an addition.

PRICING PRODUCTS

The State will consider the following pricing product:

Firm-Fixed Price with unlimited Swing: The supply of natural gas to be provided to each account under this pricing product shall be one hundred percent (100%) usage, full requirements, firm fixed price option with no guaranteed usage/volumes to the selected bidder and no usage restrictions to the State or any eligible entities participating in the procurement.

The State or any eligible entities shall be invoiced monthly on actual usage at the awarded contract price, with no restriction(s) on usage.

CHANGE IN LAW

If any Change in Law event is imposed after this Contract has been initiated, the selected bidder may pass through to the State any charges or discounts that are a result of the Change in Law so long as such charges/discounts are directly related to supplying natural gas under this Contract.

The selected bidder is required to submit a written notice of such regulatory change accompanied by an explanation and documentation of how the change is directly related to supplying electricity to the State. This notice must be provided to the State sixty (60) days prior to the implementation of the regulatory change. If the Supplier demonstrates that change in law was not reasonably foreseeable at the time of the execution of the Agreement, and that the change materially affects https://ridop.ri.gov/about-us/procurement-statutes-and-regulations https://ridop.ri.gov/about-us/procurement-statutes-and-regulations

Supplier’s ability to perform at the Contract Price, the State will not unreasonably withhold its acceptance of a reasonable incremental increase for the balance of the Term. Change in Law may be a new charge/discount or an increase/decrease in a current charge imposed by the relevant

LDC.

REPORTING REQUIREMENTS

The selected bidder is required to provide the following reports:

• Monthly Electronic Summary Report: The selected bidder shall provide the State and NORESCO with a monthly, digital natural gas consumption summary containing the following information by account number: service start date, service end date, total consumption, and total charges. The summary will be in Microsoft Excel spreadsheet template and accompany or precede payment of monthly fees.

• Enrollment Report: The selected bidder shall provide the State and NORESCO with an enrollment report detailing the status of each account to be enrolled. The enrollment report is due by the time and date specified in the Procurement Schedule.

• Monthly Usage and Cost Summary: The selected bidder shall provide the State with a report providing a summary of usage and cost for each awarded account.

NOTES AND INSTRUCTIONS TO BIDDERS REGARDING PRICING AND USAGE DATA

Any quantities in Exhibit 1 are based on historical usage obtained through the LDC at the time this solicitation was issued. The data provided is intended as an estimate of the magnitude and nature of the usage during a specified time period. Such estimates are being furnished for informational purposes. The State does not warrant the accuracy of the usage information provided and the selected bidder will be entitled to no additional compensation and no equitable adjustment of price if actual load requirements vary, except as provided in the Material Change definition. Since it is impossible to determine the precise quantities that will be needed during the contract term, each selected bidder shall be obligated to furnish the State’s natural gas requirements in full during the term of this contract.

Pricing and billing will be at the city gate.

Description of the Solicitation

In addition, the solicitation document will include several Exhibits. Exhibit 1 contains a list of included accounts; Exhibit 2 contains Pricing Requirements and Pricing Form.

Contract Award

The solicitation is issued for the State of Rhode Island by the Rhode Island Purchasing Agent, Division of Purchases that is under the jurisdiction of the Department of Administration for the State of Rhode Island. Neither the prior submission of a Technical Proposal nor approval to bid in the pricing event(s) by the State shall constitute a binding contract. All non-executive entities participating in this procurement have signed a binding Participation Agreement (Memorandum of Understanding (MOU)) committing themselves to any contract award by DOA. A Purchase Order will be issued for these requirements after a notice of award is sent by email to the winning bidder. The State will issue a notice of award by electronic mail to the selected bidder(s) on behalf of all agencies listed in Exhibit 1 no later than the date and time indicated in the Procurement Schedule. Notice of award is official and binding. The official award document (i.e., the Purchase Order) will be issued and distributed a few days after the pricing event. Other eligible entities participating in this procurement will issue a release (e.g., purchase order) to the winning bidder based on the State’s contract. Other eligible entities participating in this procurement are responsible for all costs associated with their accounts. A MPA is one form of a

State Purchasing Contract issued by the Division of Purchases. MPAs cover requirements for broad categories of items for a period of time on a State-wide basis - State and Quasi-Public Agencies order their requirements for these items individually, as the need arises. State law permits municipalities and school districts to "piggy-back" the state's pricing contracts, at the vendor's discretion. Please go to https://ridop.ri.gov/vendor-resources for additional information.

Bidders can review active MPAs at https://ridop.ri.gov/ocean-state-procures-osp/contract-board.

The purchase order for this procurement will only be issued after the pricing event.

The official contract consists of the Master Price Agreement, the Purchase Order awarded to the winning supplier(s), the requirements and specifications contained in this solicitation, which can be found at https://ridop.ri.gov/vendor-resources/all-solicitations, and the State’s General Conditions of Purchase, which can be found at https://ridop.ri.gov/about-us/procurement-statutes-and-regulations.

Procedures and Requirements Communications

Bidders are advised that once the solicitation has been issued, there shall be no contact with any governmental employees, except for the Official Contact, regarding issues pertaining to this solicitation. Instructions for participating in this bidding process, and information regarding this project, will be provided only through this solicitation and written addenda.

Communications Process

All inquiries and questions regarding this solicitation should be directed through email to Max Righter (Max.Righter@purchasing.ri.gov). No interpretations, revisions, or other communications regarding this solicitation are valid unless received in writing and signed by an authorized representative of the State.

Proposal Clarification The State at their sole discretion, may request additional information to verify the information contained in the proposal, or seek clarification of any item in the proposal.

SECTION 4: EVALUATION AND SELECTION

Those bidders that have been qualified will be invited to participate in the pricing event(s).

Bidders are not required to offer pricing for every tranche offered; however, pricing submitted for a tranche must apply to all accounts contained in that group. Bidders must hold the prices submitted in the pricing event firm until the time and date specified in the Pricing Event Schedule.

The solicitation does not commit the State to select any bidder, award any work, pay any costs in preparing a response or procure or contract for any services. The State reserves the right to accept or reject any or all submittals received and cancel or modify the solicitation in part or its entirety when it is in the State’s best interest to do so.

https://ridop.ri.gov/vendor-resources https://ridop.ri.gov/vendor-resources https://ridop.ri.gov/ocean-state-procures-osp/contract-board https://the/ https://the/ https://ridop.ri.gov/vendor-resources/all-solicitations https://ridop.ri.gov/vendor-resources/all-solicitations https://ridop.ri.gov/about-us/procurement-statutes-and-regulations