The Long Island Power Authority’s Board of Trustees in December approved a proposal for LIPA to execute a Power Supply Management and Fuel Supply Management Services Agreement with The Energy Authority Inc. for a five-year term.
PSEG Energy Resources & Trade LLC currently provides fuel management and power supply management services to LIPA under agreements that have been in effect since January 1, 2014 and are set to expire December 31, 2025.
The Power Supply Management and Fuel Supply Management Services Provider is responsible for:
- Procurement and supply of fuel for, and the scheduling, dispatch, purchase and sale of the electricity produced by, generating units that are under contract to LIPA;
- Scheduling of imports/exports over interties controlled by LIPA; and
- Managing LIPA’s wholesale power supply requirements in the NYISO, PJM and ISO NE markets.
In addition to handling day-to-day purchases and sales of power and power plant fuels, the Power Supply Management and Fuel Supply Management Services Provider also manages LIPA’s hedging program to address volatility in commodity costs.
Request for Proposals
To ensure that the vital Power Supply Management and Fuel Supply Management Services continue beyond the term of the expiring contracts, LIPA issued a Request for Proposals on May 30, 2024, seeking proposals from experienced firms to provide such services for a period of five years.
The RFP was distributed to more than 35 firms, advertised in the New York State Contract Reporter and posted on the LIPA web site.
In mid-August 2024, four firms responded to the RFP. The proposals were carefully evaluated by a selection committee consisting of an interdisciplinary group of LIPA staff and consultants.
All four respondents to the RFP passed the Phase 1 Threshold Evaluation. At the conclusion of the Phase 2 evaluation, the committee selected two firms for interviews and negotiations and organized a team consisting of LIPA executive management and external counsel that conducted negotiations with both firms from September to December 2024.
Based on the written submissions, oral presentations, negotiations, and the final evaluation carried out by the selection committee, it was determined that TEA provides the best value and is best suited to provide Power Supply Management and Fuel Supply Management Services to LIPA.
“TEA has established an exemplary track record providing the required services to similarly situated clients across the United States,” a Dec. 18 memorandum from John Rhodes, Acting CEO of LIPA, to the Board noted.
Gary Stephenson, LIPA's Senior Vice President of Power Supply, said, “Transitioning our power supply and fuel management services agreement to The Energy Authority reflects LIPA’s ongoing commitment to ensuring value and the best outcomes for our customers and electric system. We are confident this change will support LIPA’s mission to deliver clean, reliable, and affordable energy while maintaining the high standards our customers expect.”
“All of us at TEA are honored to be selected by LIPA as their future Power Supply and Fuel Management provider. As Public Power's energy trading and risk management company, TEA is excited to become LIPA's strategic partner for these services,” said Joanie Teofilo, CEO of TEA.
TEA notes that it provides the public power community “with access to advanced resources and technology for responding competitively in the ever-changing energy markets.”
As a national portfolio management and energy trading firm, TEA “not only provides public power entities with a strategic perspective on deriving maximum value from their assets, it also offers advisory services, advanced analytics, and renewable solutions.”
TEA is currently partnered with over 70 public power utilities nationwide.
