The RFP (request for proposal) course of is a crucial mechanism for municipalities to undertake photo voltaic power and obtain their sustainability targets. It establishes undertaking parameters and creates competitors amongst photo voltaic builders to supply one of the best system design and pricing that checks all of the bins outlined within the RFP.
Since 2015, I’ve reviewed and responded to a whole lot of RFPs, and realized a number of issues about how they need to be structured to make sure that initiatives are developed to fulfill buyer targets. Here is what municipalities and builders ought to take into account in regards to the photo voltaic RFP course of.
Earlier than you start
Beginning with a transparent, well-defined goal is an important factor organizations can do to make sure that their RFP is well-structured and well-received. Greater than the rest, a well-constructed aim can affect the result of the shopping for course of.
Are you attempting to fulfill sustainability targets? Or is that this undertaking primarily about creating financial worth? Understanding undertaking targets helps builders decide one of the best design for the undertaking. Usually a selection have to be made between a design that gives most financial savings or one that gives most upkeep advantages.
Understanding the location
Past the essential goal, photo voltaic builders want to know the location and any constraints. The RFP ought to clearly outline the place the location is, what particular areas ought to host the photo voltaic array, and the specified dimension of the system, if identified. It is shocking what number of RFPs fail to outline the topic space.
Do not forget that most photo voltaic builders won’t be acquainted with your web site earlier than receiving the RFP. All RFPs should start with the location tackle or parcel quantity, together with satellite tv for pc photographs outlining the areas you want to host the set up. Additionally, notice if you’re searching for a rooftop, parking cover, or floor mount set up.
In case you are searching for a system that may offset the load of your facility, you will have to supply the annual electrical energy utilization for the location, whereas utility payments or interval knowledge are additionally good to incorporate. In order for you an power saving system, it’s essential pay your utility payments and utilization in 15-minute intervals a yr.
With a transparent definition of the location and the annual use, photo voltaic builders can perceive inside minutes if the location suits their enterprise mannequin and begin investing whereas evaluating the main points of undertaking. If an RFP fails to outline the undertaking, bidders might transfer on to different initiatives which are extra clearly inside their enterprise mannequin.
Past the essential particulars, it is best to embrace any further related data, resembling utility payments, interval knowledge, electrical plans for the location, meter areas, and roof data. For rooftop installations, it is best to take into account whether or not the roof is in good situation to accommodate photo voltaic for a time period of 15-25 years. The developer will lastly affirm this through the growth course of, but when the roof is 20 years previous with no plans to switch it, it’ll kill the undertaking, so it’s best to know it as early as doable.
Understanding economics and construction
To permit builders to reveal capabilities and get one of the best outcomes on your undertaking, RFPs ought to stage assumptions which are unknown or exterior of bidders’ management.
Most municipal photo voltaic RFPs search initiatives financed within the type of energy buy agreements (PPAs), with a hard and fast value per kilowatt-hour (kWh) generated, or within the type of a lease with the developer paying the municipality in a hard and fast annual cost to the host. the system. In both construction, many variables affect the ultimate value introduced to the client, however most variables, resembling system dimension, manufacturing and set up prices, are below the management of the developer.
Municipalities should stage assumptions which are out of the developer’s management, resembling who will obtain the renewable power certificates (RECs) generated by the undertaking, any assumed incentive charges, the price of interconnection improve, and if union work or the prevailing wage is required. . With regards to RECs, the municipality can select to just accept the credit and pay the next PPA value, or the developer can hold the REC and cost a cheaper price. If the undertaking receives state or native incentives, the municipality should decide an assumed incentive charge to forestall bidders from claiming a falsely optimistic consequence.
It’s also essential that the municipality specify any practical or aesthetic necessities for the undertaking. For instance, water, snow, and ice administration is a requirement for parking zone canopies in colder climates to forestall harmful icicles or ice sheets from forming in parking heaps. Many options to handle this threat exist, however they arrive at a premium and add further prices down the street if not clearly acknowledged within the RFP.
With these assumptions leveled, the municipality can consider the worth of the bidders on an apples-to-apples foundation and consider their talents to fulfill the particular necessities.
Understanding photo voltaic builders
The important thing function of an RFP is to solicit bids from as many certified bidders as doable, so it is essential to think about which builders will reply. Not each developer has the bandwidth to pursue each good alternative. Usually the primary RFPs bypassed are these with a excessive stage of complexity.
Each proposal author understands that cities have strict procurement necessities, typically together with varied certifications or bid types. Some RFPs can go on for a whole lot of pages and require a number of arduous copies to be despatched to the client. This size and format result in an especially time-intensive and costly course of. Municipalities ought to audit the necessities and decide which questions are repetitive or pointless. Trying to tighten the size of the RFP and the period of time required to finish a horny submission might end in a larger choice of high quality proposals.
A lot is at stake in municipalities
With the fast enlargement of the photo voltaic market the RFP house will proceed to be an essential discussion board for municipalities to search out photo voltaic initiatives that finest meet their wants. By creating an RFP that creates a transparent mutual understanding of the undertaking, municipalities can enhance their possibilities of choosing the proper accomplice and attaining one of the best outcomes for his or her group.
Dan Smith has greater than seven years of expertise in photo voltaic growth for industrial, industrial and municipal prospects. In his function as DSD’s RFP origination chief, Smith leads the RFP staff and all RFP origination efforts. He evaluates out there RFP alternatives and selects the place DSD can present a compelling answer. Previous to becoming a member of DSD in 2018, Smith created profitable RFP responses that resulted within the awarding of greater than 200MW of photo voltaic initiatives, together with initiatives for Wal‑Mart, Amazon and FedEx, in addition to additionally in lots of initiatives for municipalities, college districts and utilities. Smith has expertise creating initiatives in 11 states and the District of Columbia. He has in-depth data of all lively photo voltaic markets masking all main undertaking buildings and incentives, together with PPAs, direct purchases, leases, feed-in tariffs, group photo voltaic , contracts for variations and different new monetary fashions.
