The energy sector regulator Ofgem has gone out tender with a contract worth up to £100 million for consultancy services on a wide range of issues and sectors, including energy, water, competition and market behaviour, on behalf of a number of other Government organisations.

Ofgem is purchasing on behalf of a number of other Government organisations, including Water Services Regulation Authority OFWAT. the Competition and Markets Authority (CMA), Utility Regulator for Northern Ireland (NIAUR) and the Environment Agency.

Ofgem is looking to appoint up to 150 suppliers to the wide-ranging collaborative framework agreement which has an estimated value of between £50 million to £100 million.

The framework is required for the provision of specialist consultancy advice relating to economic, financial and related consultancy services and has been divided into 7 broad Lots as follows:

Lot 1 — Energy Advice Relating to Economic and Environmental Areas.

Lot 2 — Transport Advice Covering Economic and Related Areas.

Lot 3 — General Advice Relating to Economic and Environmental Areas.

Lot 4 — Corporate Finance and Accountancy.

Lot 5 — Policy Development and Implementation.

Lot 6 — Project Management.

Lot 7 — Specialist Advice Relating to Energy and Water.

The Framework Agreement will provide the Authority, other regulatory bodies and any other public authority with economic, finance and related consultancy services. Suppliers are being invited to bid for one, some or all the Sub-Lots. The Agreement is expected to run for an initial period of three years with a further one year extension option.

The advice being sought includes consultancy on all aspects of specialised economic and environmental advice on both a cross-sectoral and industry-specific basis. Much of the advice will be highly relevant to the UK water sector, particularly in the run-up to the opening of the business sector to domestic retail competition in 2017.

For advice on Competition and Market Behaviour, the regulators are looking for suppliers with a skill set which includes a thorough understanding of competition law and policy at both national and EU level, awareness of regulated markets both in the UK and outside of the UK, together with an understanding of the policy implications for future or related projects and of corporate behaviour in monopolistic, oligopolistic and competitive market environments.

A separate lot on cost assessment is seeking advice from suppliers with an understanding of the business, financial and economic drivers underpinning cost estimates by regulated and non-regulated upstream and downstream suppliers.

One of the sub-Lots is seeking advice and consultancy services on Market Design (UK and International) from organisations with:

• Thorough understanding of the history of market reform in regulated sectors in Great Britain since privatisation, and key lessons learned from the reform process.
• Thorough understanding how the current market arrangements in Great Britain function, including good understanding of role of the system operator, understanding of licence agreements, understanding of how industry codes work in practice, relevant legislative framework (across a range of different sectors).
• Thorough understanding of the processes that support competition at the retail level (e.g. the change of supplier process), vertical separation between train companies and the network operator) and elsewhere in the value chain.
• Understanding and experience of other markets in the EU and worldwide, and ability to translate key lessons learned in a GB perspective.
• Thorough understanding of the key challenges facing the GB markets over the next 10-20 years, and ability to examine these issues holistically taking into account multiple objectives related to environment, security of supply, affordability and growth.

Other Sub-Lots include the Cost of Capital and Financeability, Capital Structure and PFI/PPP and Regulatory Accounting (including accounting for separated businesses).

Lot 7, which is divided into sub-lots, is specifically seeking specialist advice relating to energy and water to provide Ofgem, Ofwat and potentially other contracting bodies with specialist advice and services on a range of issues. Key areas of work include the development of strategy and policy and the provision of a different/independent perspective to assist policy development or generate new ideas on policy. One of the sub-lots covers issues relating to the development of best practice in customer engagement and stakeholder management in the water sector.

Deadline for receipt of tenders or requests to participate is 31^st March 2015. Click here to access the tender documentation online.