Decision details

Retendering of Heat Metering Contract

Decision Maker: Co-operative Executive

Decision status: Recommendations Approved

Is Key decision?: Yes

Purpose:

To gain endorsement on procurement plans for the new Heat Metering Contract (District Heating ) for the ongoing administrative/operational  arrangements.

 

Decision:

11.1

The Executive Director, Place, submitted a report seeking approval for Sheffield City Council to tender for, and award a new contract for the provision of Heat Metering Services for its District Heating network.  Existing contractual arrangements are due to end in September 2019 and it is intended to award a new contract from this date.

 

 

11.2

RESOLVED: That Cabinet:- 

 

 

 

(a)

approves the procurement of District Heating Metering Services via a Public Sector Framework Agreement, as detailed and outlined within the report; and

 

 

 

 

(b)

delegates authority to the Director of Finance and Commercial Services, in consultation with the Director of Housing and Neighbourhoods, following such procurement exercise to award such contract and take such other necessary steps not covered by existing delegations to achieve the outcomes outlined in the report.

 

 

 

11.3

Reasons for Decision

 

 

11.3.1

After considering the nature of this contract and taking on board the essential regulatory compliance/value for money requirements, the best option for the Council is to award via mini competition under a Public Sector Framework Agreement.

 

 

11.3.2

Out of the two available frameworks, the Yorkshire Procurement Organisation (YPO) is the favoured option.  Sheffield City Council has a long standing relationship with YPO and they have a proven and established track record in delivering frameworks for use by the public sector.

 

 

11.4

Alternatives Considered and Rejected

 

 

11.4.1

As part of an extensive appraisal of the potential procurement options available to the Council, the following options were considered:-

 

 

 

  • Option 1 > Above OJEU Invitation to Tender for services (Open procedure).

 

  • Option 2 > Call off via mini competition under a Public Sector Framework Agreement – options included YPO 642 Framework for Utilities Metering and Data Collection Services and Fife Council 10366 Framework for Heat Metering and Billing Services.

 

  • Option 3 > Renegotiate and extend the current contract through a waiver of Contracts Standing Orders.

 

 

11.4.2

It was concluded that Option 3, which would seek a further waiver of Contracts Standing Orders, would contravene PCR Regulations and present a serious risk of challenge from alternative suppliers in the market. This would also not provide the Council the opportunity to test the market through a competitive exercise and therefore may not achieve value for money.

 

 

11.4.3

Option 1 would require a significant length of time in completing a full above OJEU threshold procurement exercise and would likely exceed the expiry of the current contract ending September 2019. Furthermore, this option would require further resources in terms of time and people.

 

 

11.4.4

Having considered all options through the regular project group meetings (including advice from Commercial Services), Option 2 is recommended for the following reasons:- 

 

 

 

  • The framework agreements are compliant with EU/UK procurement.
  • Pre–agreed terms and conditions - all providers have signed and accepted this agreement and terms and conditions of call off.
  • Assured supplier standards - suppliers are pre-qualified as to their general suitability, giving customers confidence in the quality of service/products they can provide.
  • Use of framework agreements is recognised best practice for the procurement of goods and services in public sector.
  • Reduced timescales - with no need to publish requirements by OJEU or pre-qualify suppliers.
  • Immediate access/use of frameworks.
  • Ability to use our own detailed and tailored specification.
  • Can allow for direct call offs and also mini competitions.

 

 

11.4.5

Both frameworks offer a compliant, cost effective and straight forward/quicker route to market consisting of multiple suppliers who have been pre-qualified and deemed suitable to provide the requested services. Furthermore, the incumbent suppliers Switch 2 are a named supplier on both frameworks.  

 

 

11.5

Any Interest Declared or Dispensation Granted

 

 

 

None

 

 

11.6

Reason for Exemption if Public/Press Excluded During Consideration

 

 

 

None

 

 

11.7

Respective Director Responsible for Implementation

 

 

 

Laraine Manley, Executive Director, Place.

 

 

11.8

Relevant Scrutiny and Policy Development Committee If Decision Called In

 

 

 

Safer and Stronger Communities.

 

 

Report author: Stephen Parker

Publication date: 25/06/2019

Date of decision: 19/06/2019

Decided at meeting: 19/06/2019 - Co-operative Executive

Effective from: 02/07/2019

Accompanying Documents: