Opinion ID: 1822103
Heading Depth: 1
Heading Rank: 5

Heading: FPC's Bidding Process

Text: Finally, Panda asserts that the PSC's finding that FPC's bidding process complied with Florida Administrative Code Rule 25-22.082 is not supported by competent substantial evidence. We disagree. In its order, the PSC concluded that FPC's RFP complied with rule 25-22.082, which sets forth what must be included in a RFP. [11] The PSC found: FPC witness Crisp testified that on January 26, 2000, FPC issued an RFP to solicit proposals for alternatives to Hines 2. As contained in the Need Study, Exhibit 5, FPC met the requirements of Rule 25-22.082(3), Florida Administrative Code, by providing notice and disseminating the RFP to the electric industry at large. The RFP provided a detailed description of Hines 2, including the data and information required by Rule 25-22.082(4)(a), Florida Administrative Code. The RFP also included the schedule of critical dates for solicitation, evaluation, screening of proposals and any subsequent contract negotiations pursuant to Rule 25-22.082(4)(b), Florida Administrative Code. FPC's RFP also listed the price and non-price attributes that would be evaluated, and offered that other non-price attributes not listed were encouraged. The RFP also included a description of FPC's evaluation methodology for each proposal. Panda asserts that FPC's RFP was flawed in various ways. First, Panda contends that although the RFP listed price and non-price attributes to be considered in evaluating received bids, the RFP did not provide information regarding the weight to be given to either price or nonprice attributes. Second, Panda contends that the RFP was deficient because it did not specifically state what type of production costing models FPC would employ. Third, Panda maintains that FPC did not develop a short list after it conducted a screening, and instead unilaterally terminated discussions with both Panda and the other bidder on May 30, 2000. Panda asserts that had FPC developed a short list, FPC would have negotiated with the short list bidders, and this negotiation necessarily would have developed a final proposal different from that originally proposed. Finally, Panda claims that although FPC's rejection of Panda's bid was largely based upon the present worth revenue requirements (PWRR) analyses it performed, Hagler Bailly, Inc., the firm hired to perform an independent review, made no attempt to replicate the PROVIEW PWRR model runs. [12] Panda notes that the Hagler Bailly consultant did not testify to the correctness of any of the data associated with the Hines 2 Unit in the RFP, the data which provided the input into the PROVIEW PWRR model runs. Therefore, Panda argues that to the extent that the data actually entered by FPC in the computer models is incorrect, the results may be erroneous. As FPC explains, in every RFP there will be a trade-off between too much information and not enough information, and that if too much detail is included in an RFP, it may become too onerous or off-putting to potential bidders. Moreover, FPC claims that it patterned its RFP on the only available template actually approved by the PSC under its new bid rulean RFP developed by Gulf Power for its recent power plant proposal. With regard to the failure to assign specific weights to various factors, the undisputed testimony at the final hearing indicated that FPC did not assign weights to various factors in advance because FPC wanted to stimulate, rather than limit, creativity in the proposals in order to bring more value to [the] ratepayers. The unchallenged testimony also explained that in order to allow bidders to give the utility their best shot in their proposals, the utility had to retain discretion to exercise subjective judgment about all aspects of the proposals, once the utility had the benefit of evaluating the entire packages. Concerning the failure to specify the production costing model FPC would employ, the PSC found: Panda also contends in its brief that the RFP did not specifically state the models that would be used to evaluate proposals submitted. While Panda is correct, the universe of models used in the industry to evaluate production cost is small. We believe that omitting explicit reference to models in the RFP is not violative of the bid rule. Furthermore, the undisputed evidence at the final hearing was that the models FPC used were industry standards. Panda's assertion that FPC should have created a short list and then proceeded to enter into detailed contract negotiations with bidders on that list is without merit. The undisputed evidence shows that FPC received only two bids, and that it afforded both bidders full and fair consideration. Moreover, the undisputed evidence demonstrates that FPC did engage in some negotiations with both bidders, and that the pricing of Panda's proposal increased during the course of these discussions. Finally, we reject Panda's argument that there was no objective review of FPC's PWRR modeling results. First, Panda cites to no authority for the proposition that an objective review of FPC's modeling results must be conducted, and we have found no authority to support this assertion. Second, the consultant from Hagler Bailly did conduct an independent modeling and analysis, and testified at the final hearing that FPC's work was fair, reasonable, and appropriate. Therefore, we hold that the PSC's conclusion that the RFP was proper is supported by competent substantial evidence. In conclusion, we approve the PSC's order granting a determination of need to FPC to build a 530-megawatt electrical power plant. It is so ordered. WELLS, C.J., and SHAW, HARDING, ANSTEAD, PARIENTE, LEWIS, and QUINCE, JJ., concur.