Section one: Contracting authority
one.1) Name and addresses
Ofgem
10 South Colonnade, Canary Wharf
London
E14 4PU
Telephone
+44 2079017000
Country
United Kingdom
NUTS code
UKI - London
Internet address(es)
Main address
Buyer's address
https://www.mytenders.co.uk/search/Search_AuthProfile.aspx?ID=AA10021
one.2) Information about joint procurement
The contract is awarded by a central purchasing body
one.3) Communication
The procurement documents are available for unrestricted and full direct access, free of charge, at
Additional information can be obtained from the above-mentioned address
Tenders or requests to participate must be submitted electronically via
Electronic communication requires the use of tools and devices that are not generally available. Unrestricted and full direct access to these tools and devices is possible, free of charge, at
one.4) Type of the contracting authority
Body governed by public law
one.5) Main activity
General public services
Section two: Object
two.1) Scope of the procurement
two.1.1) Title
Design Options for Nodal Pricing in GB
Reference number
2021-153
two.1.2) Main CPV code
- 71314000 - Energy and related services
two.1.3) Type of contract
Services
two.1.4) Short description
This procurement is for a party to support and work alongside Ofgem in delivering a technical assessment of nodal pricing for GB.
Ofgem is keen to investigate further the potential of nodal pricing in enabling a cost-effective, secure pathway to Net Zero for the whole energy system. Greater locational and temporal market signals have the potential to drive more efficient use of system assets and lower total system costs by:
* incentivising optimal demand and supply responses (in the right place at the right time);
* stimulating innovation in storage and demand response in the places it is needed; and
* supporting competition between demand/storage solutions and new network capacity.
two.1.5) Estimated total value
Value excluding VAT: £350,000
two.1.6) Information about lots
This contract is divided into lots: No
two.2) Description
two.2.2) Additional CPV code(s)
- 09310000 - Electricity
- 71314000 - Energy and related services
- 71314300 - Energy-efficiency consultancy services
two.2.3) Place of performance
NUTS codes
- UKI - London
Main site or place of performance
London
two.2.4) Description of the procurement
Nodal pricing (also known as locational marginal pricing/LMP) is a form of market design used in more than 10 jurisdictions in various forms and is often considered best practice amongst electricity market designers worldwide.
Nodal pricing for GB has gained traction in recent years. A 2015 CMA investigation into the potential of locational marginal pricing in GB estimated potential benefits of up to 70 million GBP per year in England and Wales alone. In 2020, Aurora produced a report for the Policy Exchange estimating average system savings from nodal pricing to be 2.1bn GBP per year across GB in the period 2025 - 2050.
More recently, the Energy Systems Catapult (Oct 2021) concluded nodal pricing is the “first best approach to signalling locational value in a more deeply decarbonised, decentralised, and digitised electricity system”.
Ofgem is keen to investigate further the potential of nodal pricing in enabling a cost-effective, secure pathway to Net Zero for the whole energy system. Greater locational and temporal market signals have the potential to drive more efficient use of system assets and lower total system costs by:
* incentivising optimal demand and supply responses (in the right place at the right time);
* stimulating innovation in storage and demand response in the places it is needed; and
* supporting competition between demand/storage solutions and new network capacity.
Nodal pricing would, however, represent major and complex reform to the GB electricity market. To inform Ofgem’s position on future market design, Ofgem is keen to develop a robust understanding of:
* The technical models for LMP in GB
* The associated costs, benefits, and distributional impacts of said models
* The implementation requirements for a preferred model.
This will require an overarching assessment of the value of nodal pricing to GB consumers and in achieving the UK’s decarbonisation targets, with this to be modelled as part of this project.
"See attached 2021-153 Design Options for Nodal Pricing in GB ITT document for further detail"
two.2.5) Award criteria
Quality criterion - Name: Technical / Weighting: 75
Cost criterion - Name: Commercial / Weighting: 25
two.2.7) Duration of the contract, framework agreement or dynamic purchasing system
Duration in months
5
This contract is subject to renewal
Yes
Description of renewals
optional 2 months extension at the Authority’s discretion
two.2.10) Information about variants
Variants will be accepted: No
two.2.11) Information about options
Options: No
two.2.13) Information about European Union Funds
The procurement is related to a project and/or programme financed by European Union funds: No
Section three. Legal, economic, financial and technical information
three.1) Conditions for participation
three.1.2) Economic and financial standing
Selection criteria as stated in the procurement documents
three.1.3) Technical and professional ability
Selection criteria as stated in the procurement documents
three.2) Conditions related to the contract
three.2.3) Information about staff responsible for the performance of the contract
Obligation to indicate the names and professional qualifications of the staff assigned to performing the contract
Section four. Procedure
four.1) Description
four.1.1) Type of procedure
Open procedure
four.1.8) Information about the Government Procurement Agreement (GPA)
The procurement is covered by the Government Procurement Agreement: Yes
four.2) Administrative information
four.2.2) Time limit for receipt of tenders or requests to participate
Date
17 January 2022
Local time
12:00pm
four.2.4) Languages in which tenders or requests to participate may be submitted
English
four.2.6) Minimum time frame during which the tenderer must maintain the tender
Tender must be valid until: 18 April 2022
four.2.7) Conditions for opening of tenders
Date
17 January 2022
Local time
12:00pm
Section six. Complementary information
six.1) Information about recurrence
This is a recurrent procurement: No
six.2) Information about electronic workflows
Electronic invoicing will be accepted
Electronic payment will be used
six.3) Additional information
Please see the ITT document for further information.
NOTE: To register your interest in this notice and obtain any additional information please visit the myTenders Web Site at
https://www.mytenders.co.uk/authority/notice_UnpubView.aspx?ID=224687.
The buyer has indicated that it will accept electronic responses to this notice via the Postbox facility. A user guide is available at
https://www.mytenders.co.uk/sitehelp/help_guides.aspx.
Suppliers are advised to allow adequate time for uploading documents and to dispatch the electronic response well in advance of the
closing time to avoid any last minute problems.
(MT Ref:224867)
NOTE: To register your interest in this notice and obtain any additional information please visit the myTenders Web Site at https://www.mytenders.co.uk/Search/Search_Switch.aspx?ID=224687.
The buyer has indicated that it will accept electronic responses to this notice via the Postbox facility. A user guide is available at https://www.mytenders.co.uk/sitehelp/help_guides.aspx.
Suppliers are advised to allow adequate time for uploading documents and to dispatch the electronic response well in advance of the closing time to avoid any last minute problems.
(MT Ref:224687)
six.4) Procedures for review
six.4.1) Review body
Public Procurement Review Service
Cabinet Office
London
publicprocurementreview@cabinetoffice.gov.uk
Telephone
+44 3450103503
Country
United Kingdom
Internet address
https://www.gov.uk/government/publications/public-procurement-review-service-scope-and-remit