Maine State Electricity Procurement Program Criticized Over Transparency Concerns
January 12,2017
The Portland (ME) Press Herald published a two-part report (part 1)(part 2) from Maine Center for Public Interest Reporting which raises concerns with the Maine PowerOptions electricity procurement program, an opt-in aggregation for state, municipal, and other public agencies
The Maine Center for Public Interest Reporting report cites what the Center alleges is a lack of transparency in the program, lack of documented savings, and that the PowerOptions is not subject to the same disclosures as other state procurements. The Maine Center for Public Interest Reporting report notes that Constellation has been selected as the PowerOptions program supplier as a result of every bid in the program's history.
The Maine Center for Public Interest Reporting alleged that, "MPO’s 2008 agreement with the Maryland-based supplier — kept confidential but obtained by the center — reveals that the energy program’s staff have been prohibited from recommending any other supplier to members, regardless of potential cost-savings, calling into question whether the program is consistently working in its members’ best interests."
Constellation issued the following statement:
"MPO’s energy program is voluntary, and members are under no obligation to participate. The program gives members the option to shop for electricity supply and energy services from an endorsed supplier that has been selected through a competitive RFP process.
"As one of the nation’s largest retail energy suppliers, Constellation is proud to serve as the endorsed energy supplier for MPO. Our stability, backed by our parent company’s fleet of top-performing power plants and more than a decade of experience helping customers to manage price volatility risk, means that we can offer customers consistent value, high-quality service, and a variety of contract options to best meet their energy needs.
"Shopping for energy supply provides customers the flexibility to choose a supplier based on rate, fixed or flexible pricing, contract terms, and quality of customer service. Because prices vary considerably based on wholesale costs, sometimes the competitive supplier may have a lower rate than the utility’s standard offer. Other times, the utility may have a lower rate. We do our best to walk customers through all the options available to them. "
The Maine Center for Public Interest Reporting represented that, in response to certain bullet points about the forthcoming report, Michael Goodwin, executive director of the Maine Municipal Bond Bank and the Maine Health and Higher Educational Facilities Authority, which oversee the PowerOptions program, issued the following statements in an email to the Center:
• "The Maine PowerOptions program is a completely voluntary program run jointly by the Maine Municipal Bond Bank and the Maine Health and Higher Educational Facilities Authority. The authority to operate the program was granted by the legislature to provide an aggregation service to all non-profits in the state. We cannot stress enough the program is completely voluntary. Pricing is provided to members as requested with no risk to them. They are free to explore all other options available to them. We are but one of those options.
• "MPO provides a voluntary option for our members to utilize when analyzing who provides their power. We do not make those decisions for them. The savings associated with utilizing our program can come in many forms, from achieving a low rate for power to saving time and money by utilizing a uniform contract with favorable terms. We provide our members with a choice. We have hundreds of members, most of which have repeatedly utilized our program.
• "The electricity supplier for MPO is selected through an RFP process every 3-4 years.
• "The IAC [Institutional Advisory Council] is an advisory body. It has no decision making authority but can make recommendations. The program staff listens to the IAC as representative of its membership and makes its decisions accordingly. All decisions are made by the program staff. No decision made by the program is legally binding to any member. Members are free to participate or not."
See the reports as published by the Press Herald for more:
