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Louisiana utility regulators award long-awaited energy efficiency contract

Transmission towers carry electricity in LaPlace on Dec. 28, 2021.
Wesley Muller
/
Louisiana Illuminator
Transmission towers carry electricity in LaPlace on Dec. 28, 2021.

State utility regulators have awarded a contract to a local company to administer Louisiana’s new statewide energy efficiency program, meant to cut down on power waste and ultimately save customers money.

Even though it’s taken more than a decade for the Louisiana Public Service Commission to strike the deal, there was still debate about starting the bidding process over again.

LPSC members voted unanimously Tuesday to contract with APTIM, the lowest bidder, as administrator of its energy efficiency program through 2029 for $24.5 million. The Baton Rouge-based firm outbid two other competitors by significant margins.

TRC, a Connecticut company with offices in Baton Rouge, New Orleans and Alexandria, submitted a bid of $37.6 million. Frontier Energy of California bid $41.4 million.

The LPSC’s new energy efficiency program will establish certain statewide energy savings targets. Hitting those targets could require the administrator to implement things such as appliance upgrades for large commercial buildings or help low-income customers insulate their homes.

While the idea might seem like a straightforward solution to cut back on waste, the utility companies vehemently opposed the idea and successfully delayed its adoption for years. A consultant the commission hired to write the basic guidelines for the program spent 13 years and over $500,000 trying to appease utility companies with agreeable rules.

Fed up with the delays, Commissioner Craig Greene, R-Baton Rouge, ended the stalemate in January and joined with the two Democrats on the commission to adopt what they say is a more consumer-friendly program than what the utilities wanted.

Still, Commissioner Eric Skrmetta, R-Metairie, made a last-ditch attempt to stall the program ahead of Tuesday’s vote, moving to restart the bidding process because he felt the amounts were too high.

“I’m just overwhelmed by the bid amounts on this,” Skrmetta said. “They’re basically just monitoring a system. So I’d like to ask the commission to consider putting this back out for a re-bid.”

Skrmetta ultimately withdrew his motion and sided with the rest of his colleagues on the final vote to accept APTIM’s low bid.

Commissioners issued a request for proposals in May to build and oversee the state’s new energy efficiency program. Nine companies responded, and three ended up submitting formal proposals. APTIM was both the lowest bidder and the only company headquartered in Louisiana.

Pointing to the wide margins between the bids, Commissioner Foster Campbell, D-Bossier City, wanted assurances that APTIM wasn’t deliberately underbidding the contract with plans to later seek a larger payout.

“I want to be crystal clear here that you’re not lowballing this to come back and ask for more money later,” Campbell asked APTIM executive Joel Freehling, who assured him that $24.5 million is the company’s full five-year budget.

“We have bid this based on our experiences in Wisconsin and other states and believe this is the cost,” Freehling said.

APTIM has more than 475 employees in Louisiana and has worked in eight other states, including as the administrator for statewide energy efficiency programs in Vermont and Wisconsin.

Their work in Louisiana will begin in January with a one-year transition and an initial design phase. Eventually, APTIM is expected to monitor utility companies to make sure they are following through on any of the program’s requirements.

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