PGE to competitors: Heads I win, tails you lose

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By: SGN Staff

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Quick Take: In decades past, few people took notice of electric power utilities. That has changed now, especially in the East and Midwest, where utilities such as ConEd, Long Island Power Authority and ComEd are under intense scrutiny to become more resilient against storms. New York Governor Andrew Cuomo has even asked for the power to shut down under-performing utilities.  Will PGE soon find itself under a similar spotlight? If so, it may have been self-imposed.

- By Jesse Berst

 

Portland General Electric competitors are up in arms. PGE just completed a two-year bidding process to choose vendors for new transmission and new generation. Dozens of companies offered bids on three major projects. PGE set up the requirements, developed the scoring, reviewed the bids and chose the winners. And when the final results were unveiled on June 3, the winning bidder for all three was... PGE (or a contractor acting in its behalf).

 

The other bidders were "left agape" according to a story from the Associated Press. "People are uniformly upset," said Robert Kahn, executive director of the Northwest & Intermountain Power Producers Coalition. "They sincerely believe that they were offering projects at a fraction of the cost. There was a lot of money left on the table."

 

According to the AP story, years will pass before review of PGE's choices. Review won't take place until power plants are complete and the utility seeks recovery of the costs in rates years later. Yet other bidders believe an after-the-fact review may not be effective. The investments are so large they could tie commissioners' hands, giving PGE too-big-to-fail protection from disallowances.