HomeMy WebLinkAboutFIN-20-050 - P20-092 Direct Purchase of Natural Gas Administration and Consulting
REPORT TO: Special Council
DATE OF MEETING: 2020-08-10
SUBMITTED BY: Ryan Scott, Manager of Procurement, 519-741-2200 ext. 7214
PREPARED BY: Adam Buchholtz, Associate Procurement Specialist, 519-741-2200 ext.
7217
WARD (S) INVOLVED: N/A
DATE OF REPORT: 2020-07-13
REPORT NO.: FIN-20-050
SUBJECT: P20-092 Direct Purchase of Natural Gas Administration and Consulting
__________________________________________________________________________________________
RECOMMENDATION:
That Proposal P20-092 Direct Purchase of Natural Gas Administration and Consulting, be
awarded to ECNG Energy Group, Burlington, Ontario, at their estimated fee of $91,000,
plus H.S.T. of $11,830, for a total of $102,830, for a one (1) year term with the option to
renew for an additional four (4) one year terms, provided a satisfactory contract is
executed.
BACKGROUND:
Kitchener Utilities (KU) purchase and manages the ~$28M annual natural gas portfolio to ensure
a continuous and economical supply on natural gas is provided to our customers. As the energy
market is continuously changing, having up to date market information is essential. An
experienced consultant is required to provide weather information, market pricing, trends and
forecast to be able to model various scenarios and make recommendations for short and long-
term natural gas supply and delivery options for up to 3-years in advance.
There are many tasks that are required to optimize the gas portfolio which require specialized
industry knowledge. KU requires a consultant to perform services that include planning, daily
operations and balancing, settlement of contracts and regulatory activities related to the
purchase delivery and supply of natural gas. The consultant will assist in the optimization of KU
storage and transportation contracts with Enbridge Gas Inc.
REPORT:
Proposals were advertised publicly on the City of Kitchener website. Documents were
downloaded by seven (7) interested parties and by the closing date of Thursday May 14, 2020,
six (6) proposals had been received.
*** This information is available in accessible formats upon request. ***
Please call 519-741-2345 or TTY 1-866-969-9994 for assistance.
A listing of the responding parties follows for your reference:
Ag Energy Co-operative Ltd. Guelph ON
Blackstone Energy Services Toronto ON
ECNG Energy Group Burlington ON *
Global Petroleum Marketing Inc. Calgary AB
Jupiter Energy Advisors Inc. Toronto ON *
Perimeter Energy Inc. Burlington ON
*Shortlisted candidates
The proposal submissions were reviewed and rated by the selection committee, G. St. Louis,
Director Gas & Water Utilities, L. Jones, Manager Gas Supply and Engineering, and J.
Chaterjee, Regulatory Analyst.
The review committee met on Monday June 8, 2020, and a shortlist of two (2) candidates * was
selected for further interviews.
The review committee met on Friday June 19, 2020, to interview and rate the shortlisted
candidates.
The committee recommends awarding the project to the highest rated proponent ECNG Energy
Group, Burlington, Ontario.
The selection committee rated the proposal submissions on the following criteria:
Experience of Proposed Team
Planning Services
Operating Services
Settlement Services
Regulatory Services
Effect of Interview
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
the delivery of core service.
FINANCIAL IMPLICATIONS:
The net cost for this proposal (A), is fair and reasonable for a project of this scope but the
upset limit exceeds the budget allowance (B) provided within the budget. Funding for this
project is included within the approved budget. The estimated deficit (D) will be funded by
other savings in the Gas Utility operating budget.
Proposal P20-092
Consultant Services - Advisory Services for the Procurement of Management of
Natural Gas Supply
Estimated Cost
Proposal P20-092 costs, including HST 102,830.00
less: HST rebate on proposal (11,830.00)
Net Cost Being Awarded 91,000.00 A
-
Estimated Cost 91,000.00 C
Funding Available
Professional Service Consultant 68,500.00
Total budget 68,500.00 B
Estimated Surplus/(Deficit) (B - C) (22,500.00) D
COMMUNITY ENGAGEMENT:
INFORM
council / committee meeting.
ACKNOWLEDGED BY: Jonathan Lautenbach, Chief Financial Officer, Financial Services
Department