With the aim of sharing our approach, which cuts across several of the procurement activities, we have focussed the case study specifically on the procurement for the Maintenance & Repair of 26-ton Hydrogen Fuel Cell Electric Refuse Collection Vehicles. Highlighting the key actions and decisions which influenced the route to market, evaluation criteria, commercial model and outcome focussed specification – all captured within the relevant sourcing strategies.
Details as follows:
Economical and Financial Standing
Due to the high value and innovative nature of the requirement and the prevailing economic conditions directly affected by the COVID-19 pandemic; the economic and financial standing of potential bidders was a significant potential risk factor for the Council. This coupled with market research indicated advance payment may be required to support suppliers cash flow and encourage collaboration and consortium bids within the supply chain.
Following further investigation, the Council was able to develop an approach that would still encourage consortium bids but mitigate against the need to include payment in advance whilst supporting the cash flow requirements of bidders. The solution required bidders to meet the Council’s Economic and Financial Standing requirements, which are identified on a risk-based project by project basis, and in addition required the bidder to submit a letter of comfort from the organisation’s bank stating its current business status.
Furthermore, to mitigate the financial pressure on the successful supplier which would likely be required to invest a significant value of money to purchase/build the refuse collection vehicles. The Council incorporated a phased approach delivery model to support full delivery of the RCVs to the Council by October 2022.
The above approach to financial standing supported market findings re capacity issues, product availability, cash flow issues and market /financial volatility whilst providing a relevant and proportionate and legally compliant procurement activity that adhered to the Council’s Standing Orders relating to Contracts 2017.
The commercial model was considered in great detail, with the aim for the Council to procure the highest volume of RCVs within the available revenue budget.
The CPU Category Manager considered whole life costs to ensure that best value for money was achieved. The following cost factors where identified: purchase; planned maintenance; unscheduled repairs and spares parts. In order to ascertain the best evaluation weightings for each cost factor, various scenarios were examined and tested utilising the CPU evaluation scoring calculator.
Furthermore, a decision was taken to implement a fixed price contract which required the Bidders to submit prices for years 1 to 3 of planned maintenance and then different rates for years 4 onwards. This allowed the Council to have visibility of all costs upfront and permitted bidders to consider an increase to their maintenance costs as vehicles get older.
The commodity team agreed that in relation to the scope and commercial model, no specific quantity of refuse collection vehicles would be referenced ONLY the available budget. The commercial model was structured to provide the Bidder, which submitted the most competitive RCV price, to obtain the full 40% score for this element of the 60% commercial evaluation criteria. The remaining 20% price weighting was allocated to maintenance, repair and spare parts cost that would address the whole life cost of the RCVs.
This commercial strategic approach enabled the largest total number of RCVs to be purchased for the available budget and at the best value rate.
Embedding sustainability requirements
As part of the mandatory CPU sourcing strategy development, the Scottish Government Sustainability Test was completed. This identified the following sustainable risks and opportunities relevant to this procurement: Carbon - Energy Consumption, Carbon – Production, Climate Change Adaption, Employment - Skills and Training, Fair Work Practices & Health & Safety.
The outcomes of the Sustainability Test were incorporated within the relevant stages of the procurement exercise of which the main emphasis was on the specification and quality evaluation award criteria. The specification stipulated “the purchase of 26 tonne hydrogen fuel cell electric refuse collection vehicles” and detailed technical aspects which were an important step for Glasgow City Council (GCC) in response to the impending climate emergency which will support the decarbonisation of the fleet and shall reduce the city's carbon emissions.
Furthermore, with regards to the quality evaluation award questions, these were scored at 40% of the 100% available marks. This criteria included various technical questions, details as follows:
In accordance with the specification the Bidder shall deliver zero-emission hydrogen fuel cell electric refuse collection vehicles with a minimum 30% greater fuel efficiency than that of an existing Euro VI Diesel refuse collection vehicle. GCC’s current refuse collection vehicle fleet operates at an existing average of 4mpg.
Please provide evidence as to how the fuel cell electric refuse collection vehicle being proposed meets this operational performance, inclusive of the technical specification.
Your response should include, but not be limited to,
Components such as fuel cell powertrain design/ specification, hydrogen fuel storage, and all duty cycle modelling undertaken to meet the criteria (RCV performance capacity etc) and how all components all combined meet the fuel efficiency.
This model shall demonstrate the relationship between mpg and kg/km and the increased fuel efficiency.
|Please describe how you will commit to Fair Work practices for workers (including any agency or sub-contractor workers) engaged in the delivery of this contract||5%|
|Community Benefits of which Bidders had to offer 110 points from the various themes available.||Mandatory Pass/ Fail|
|Health and Safety Questionnaire||Mandatory Pass/ Fail|
|Please provide evidence of how you will ensure that all vehicles used in the delivery of this project, including maintenance journeys, will meet the requirements of the City’s Low Emission Zone.||2%|
|What is your strategy for any safe disposal of waste produced through the vehicle production, maintenance and repair?||1%|
|Please detail how you will mitigate emissions whilst delivering maintenance for FCEV RCV.||1%|
The contract for Purchase, Maintenance & Repair of 26-ton Hydrogen Fuel Cell Electric Refuse Collection Vehicles was approved by the Council’s Contract and Property Committee at its meeting on the 16th June 2021.
The contract mobilisation is underway.