How it works
The route to working with the CEF is to seek membership, which then makes all the support of the CEF available to the New Member for the entire procurement, installation and savings monitoring period of the contract. The CEF Process provides a robust and unique methodology to procure projects.
STAGE 1: Membership (4 weeks)
Preparing a member to use the CEF OJEU compliant process
There is 1 to 2 months of preparatory work before proceeding to mini-competition. This period is used to gather data, obtain New Member approvals and to prepare for the release of the project to mini-competition, so that the bid process can start immediately.
The tasks that will need to be completed:
Trust Expresses Interest In CEF – The New Member should email the Fund at EOI@carbonandenergyfund.net and express an interest in joining the Fund.
Shared Scope Of Scheme With CEF – The New Member should then share the scope of its intentions with the CEF. Ideally this will be supported by some New Member documentation such as an estates strategy, business case or other similar document showing that the status of the project within the organisation.
Meeting with Estates, finance and procurement – The CEF will visit the site to meet the New Member team and see the existing and proposed installation. The CEF will meet the New Member estates team, who look after the existing energy installation, so as to know where to obtain technical information, and the level of estates support for the project.
The meeting should include the New Member’s finance team to discuss how the fund works, the three finance options available to the New Member, balance sheet treatment and VAT. It is helpful to include the New Member’s procurement team, to explain the framework and make sure that procurement are comfortable with the CEF process.
The CEF will assist the New Member with an outline feasibility to assure all parties that a self-funded solution repaid through guaranteed savings is possible. The feasibility is not intended to define the final scheme, because we seek real innovation from our bidders. Instead the feasibility is intended to determine the likely minimum capital investment, annual payment and annual guaranteed savings that are possible at the site
The CEF exists for the NHS and Public Sector, and our support lasts through project preparation, procurement, contract award, installation and annual monitoring for the entire life of the contract. It is important with cradle to grave support lasting 17 to 27 years, that the responsibilities of the parties are written down, and the membership agreement does this. Many New Members take the membership document to their board or capital investment committees for approval, and this stage needs to be complete before the mini-competition can start.
STAGE 2: Invitation to Mini-Competition (8 weeks)
Once a New Member is a Member, and the feasibility and data collection is done then the OJEU based mini- competition can start.
The Mini competition phase
The Framework procurement is a method of procurement where a number of companies are shortlisted under OJEU. The CEF procurement has tested the market and sixteen companies have been approved onto each of two frameworks. Click here to find out about the selected companies. (Link)
First stage selection process based on pre-agreed criteria
When a Member starts its mini-competition it will ask all bidders on the framework to express interest in the project. Those companies that express interest will be invited to an open day, and then interviews.
The open day is for the Member to explain their project to the market place, and to stimulate interest from the framework bidders. It is also the day when bidders start to formulate ideas about how they may best support the Member. After allowing circa 2 weeks for the formulation of ideas the Member then holds interviews for all the interested framework bidders.
At the interviews each bidder will get a time to give their initial ideas to the Member to show that they are the best company for the Member to work with. They will explain their record, their approach and their financial model established during the framework procurement, which will also explains their costs. The interviews are scored formally and the best scoring companies are selected.
The Member will select up to 4 bidders that it would like to work with. Those bidders will be invited to open days with the Member’s estates team and a set of one to one discussions over the period of about one month. In those meetings the Member will form a team with each bidder, so there are in effect four teams working together to come up with their best solution for the Member’s requirements. In the last meeting with each bidder, the team are expected to discuss the proposed bid and make sure its as good as it can be.
STAGE 3: ITT and Contract Close (20 weeks)
When ready the Member will release its Invitation to Tender to the four bidders. Each bidder will produce its best bid for the Member based on the information and advice given, and present this to the Member in the form of a business case. The Member and CEF will work together to evaluate the bids, choose the project that offers the best value for money add a recommendation sheet and send it to the Member’s board for approval. Should the board withhold approval the project will stop, at no cost to the Member.
Should the Member approve the business case, then that bidder will be given 3 months to complete its design and the contract technical schedules, ready for the Member to sign. Should the contract be for the same (or better) price and guaranteed savings, then the Member is expected to sign the contract. If it does not, then it will be expected to cover the bidder and fund costs associated with those 3 months.
STAGE 4: Construction (Project dependent)
The installation phase starts with contract award and typically lasts a year. The CEF will chair monthly technical and project board meetings to help the Member manage the installation, and the CEF will work closely with the Member to oversee the tests for practical completion. Only when the installation is proven to meet standards and to perform properly technically and financially will practical completion be approved. The project enters the operational phase.
STAGE 5: Performance Contract Management
When the installation has passed practical completion, then the Member starts it’s payments (the first it has made to anyone in this project ) and the guaranteed savings start. Every month the energy meter readings will be collected by the audit system, and the CEF will monitor performance. Every quarter this will be reviewed more thoroughly and action taken if the contract is under performing. At the end of the year the CEF will review the project over the whole year and certify the level of savings generated. If the savings equal, or exceed the guaranteed savings, then all is well. Should the savings be below the guaranteed level, then the contractor will write the Member a cheque for the shortfall.
Should there be any contractual or performance issues at any time with the contract, then the CEF will support the Member in dealing with them at no extra cost.
The CEF charges no fees. We supply project management, specialised technical, legal, procurement, financial and balance sheet support, our contract, our framework and cradle-to-grave project support to members for free. All that we ask is that Members only use us if they genuinely wish to upgrade their carbon and energy infrastructure at no net cost to themselves, and also ask that if they do so, that the contract includes within its costs a contribution to our legitimate costs. The CEF fees have been benchmarked at 50% of typical fees paid by the Public Sector for similar type projects provided by other suppliers.
This means that there is no commitment until the Member’s board agrees to appoint a preferred bidder. All project costs including those of the CEF, are included within the bid presented to the Member’s Board and covered by guaranteed savings. The Member needs pay for nothing (apart from a couple of days of legal due-diligence time) until the project is procured, installed, and proven to be generating the guaranteed savings.
No other procurement route for the Public Sector can make this offer.
Joining the Fund
New Members wishing to express interest in joining the fund, or be added to the fund update list should email EOI@carbonandenergyfund.net.
Who are the CEF?
Energy Infrastructure Upgrades
- Created by the NHS for the NHS and Public Sector
- Efficient and proven OJEU compliant procurement process
- Access to a £300m+ fund of capital funding
- The widest choice of ESCo contractors in the UK
- CEF provides all the specialist skills and resources
- No up front fees
- TDA approved procurement process
- A track record of 40+ successful UK projects to-date