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UMS Procurement Office Issues New Award to Negotiate Following ConEdison Solutions Withdrawal From UMaine Energy Strategic Sourcing Initiative

Citing uncertainty about its ability to lease assets in the former Expera Mill in Old Town, ConEdison Solutions informs University it cannot provide firm pricing offer or deliver a plan for securing control of power generating assets within the University’s prescribed timeframe

AUGUSTA, MAINE — Following its February 21, 2018 receipt of notice from ConEdison Solutions that it was withdrawing from negotiations, the University of Maine System Office of Strategic Procurement issued an award to negotiate today to Honeywell International, the respondent with the second highest score as determined by the core team established to manage the University of Maine Energy Solutions Solicitation (RFP #2016-43).  Subject to a new review period under University of Maine System procurement policy, the award grants Honeywell International the right to negotiate a long-term energy solution for the University that meets the institution’s objectives around cost minimization, cost predictability and stabilization, climate commitment, and improved reliability.  

The award letter was issued Thursday, February, 22, 2018, along with notification letters of the new award to the fourteen remaining respondents to the public solicitation for proposals.  The University of Maine negotiating team will engage with Honeywell International to assess intent and develop a plan for discussions while preserving the appeal rights of unsuccessful respondents, which is a requisite element of the University of Maine System’s procurement process.   

Honeywell International’s proposal received the second highest overall score from the core team’s 2017 evaluation of the four Phase II proposals received in the Energy Solutions Solicitation process. Throughout the solicitation and negotiation process the University of Maine System reserves the right to proceed with an award to negotiate toward a contract with the respondent whose proposal was deemed to be in the best interests of the University.  The University could also terminate or start the process over at any time based on a detailed analysis of economics, opportunities, and risk.  

Details on the solicitation, University objectives, core team membership, project concept highlights, and evaluations can be viewed in the RFP #43-16 Phase II Recommendation Presentation.  If the University negotiating team successfully reaches agreement with Honeywell International, the agreement would come before the University of Maine System Board of Trustees for public review and consideration.  

Mill Uncertainty Leads to Withdrawal

The University of Maine entered into negotiations with ConEdison Solutions immediately following the initial June 16, 2017 award to negotiate.  Discussions had advanced to the submission of a preliminary pricing proposal on January 17, 2018, followed in early February with a response from the University’s negotiating team.

A significant component of ConEdison Solutions’ proposal was the utilization of power generating assets at the former Expera Mill in Old Town.  OTM Holdings, LLC announced late last month it had acquired ownership of the mill.

As ConEdison Solutions General Manager Jack Bosch noted in his February 21, 2018 withdrawal letter, the new owner of the former Expera Mill is in the early stages of its planning process and has yet to determine if its plans for the site would accommodate ConEdison Solutions’ proposed lease of the power generating assets to serve the University.  

Noting this uncertainty, Mr. Bosch informed the University of Maine System Office of Strategic Procurement yesterday that ConEdison Solutions is unable to provide the University with a firm pricing offer or deliver a plan for securing control of the power generating assets within the University’s prescribed timeframe.  Because of the uncertainty, ConEdison Solutions stated in the letter its decision to withdraw from further negotiations with the University with respect to Phase II Energy Solutions RFP # 2016-43.  

“The University of Maine is seeking solutions to its long term energy needs and climate commitment through innovation and private sector partnership, an approach to sourcing that requires both adherence to objectives and responsiveness to changing market conditions,” said Dan Demeritt, Director of Public Relations for the University of Maine System.  “The University has now proceeded with an award to the next highest scoring respondent in keeping with a fair and transparent procurement process developed to safeguard the integrity of deliberations and to achieve the best possible outcome for our students and the taxpayers of Maine.

“The University appreciates ConEdison Solutions participation in this process and the professionalism of its team.”  

Process Note

The UMS Office of Strategic Procurement typically uses web postings, legal advertisements for solicitation, and proactive notification to potentially interested respondents to create awareness about procurement activities.  See slide 4 of the presentation linked above.  

Given the general public interest in the UMaine Energy Solutions Initiative and the importance of transparency the University of Maine System has taken the additional step of issuing a news release announcing the new award to negotiate.