PSE as a solid business partner

As a contracting authority, PSE conducts contract award procedures for public and non-public supplies, services and works pursuant to the Act of 29 January 2004 – Public Procurement Law (hereinafter: “PPL Act”) together with implementing measures and the PSE Contract Award Procedure (Procedure).

Contract award from PSE can be sought by contractors who:

• have formal qualifications to conduct of a specific business or activity, where required by law,
• possess the necessary knowledge and experience,
• have at their disposal the relevant technical potential and personnel capable of performing the contract,
• be in a financial and economic condition that ensures the performance of the contract,
• are not subject to exclusion from the contract award procedure.

A detailed method of procurement is defined by the provisions of the PPL Act and the PSE Contract Award Procedure.

In order to maintain the transparency of activities related to the award of contracts, we prepare and conduct public and non-public procurement procedures in compliance with the principles of:

• fair competition,
• impartiality and objectivity,
• equal treatment of contractors,
• transparency.

We comply with the above principles in all stages of the procedure; in its preparation phase (preparing the terms of reference and appointing the tender evaluation committee) and in the course of the contract award procedure. In addition, activities related to the preparation and conduct of the contract award procedure are performed by persons who ensure impartiality and objectivity of the whole procedure.

The principle of fair competition is the foremost principle in managing tendering procedures and awarding contracts. Its application allows equal access to information on contracts and to contracts themselves of all the parties concerned. The principle concerns, among other things, the method of delivery of statements, applications, notices and information. It should also be taken into consideration at the stage of describing the conditions for participation in the procedure and when preparing the description of the object of the contract. The object of the contract must not be described in a manner that hinders fair competition. It should be described in an unambiguous and exhaustive manner, by means of sufficiently precise and comprehensible statements, taking into account all requirements and circumstances that may affect the tender preparation process.

Tendering procedures sometimes impose a minimum number of potential contractors in order to ensure compliance with the fair competition principle.

The conduct of the procedure in a manner that guarantees fair competition requires compliance with the following rules:

• admission of multiple contractors to participate in the procedure,
• specification of requirements that guarantee access to a contract only for credible contractors,
• defining terms of the contract in a manner that enables contractors to prepare a competitive tender.

The fair competition principle applies also to contractors. Submission of a tender that constitutes an act of unfair competition is a basis for the rejection of the tender.

According to the equality principle, also referred to as the “principle of equal treatment of parties seeking contract award”, all contractors should be treated equally, based on identical criteria. The contracting authority may not apply requirements that give preference to a particular contractor. It should apply a single measure for all contractors, i.e. place the same requirements, verify compliance and enforce them in the same way.

According to the equality principle, also referred to as the “principle of equal treatment of parties seeking contract award”, all contractors should be treated equally, based on identical criteria. The contracting authority may not apply requirements that give preference to a particular contractor. It should apply a single measure for all contractors, i.e. place the same requirements, verify compliance and enforce them in the same way.

The conduct of the procedure in a manner that guarantees equal treatment of contractors requires:

• definition of requirements in the same manner for all contractors interested in being awarded a contract,
• definition of the same method of confirming compliance with the requirements for all,
• resolving – by comparing information and documents submitted by contractors with the requirements – whether contractors meet the requirements, and taking decisions specified in the terms of the contract according to the evaluation results.

The principle applies both at the stage of putting forth conditions for participation in the procedure or during the evaluation of tenders or selection of the most advantageous tender. The equality principle means a ban on the discrimination of individual contractors on grounds of their legal status, the contractor’s location or characteristics.

Transparency means clear and unambiguous rules of the game. The principle of transparency is furthered by the openness of the procedure, defined as access of all interested participants of the procedure to related information on equal terms, as well as ensuring maximum impartiality and objectivism in all actions undertaken.

Our organisation, as a socially responsible entity, cooperates with a large group of contractors and suppliers.

The main groups of PSE’s suppliers include contractors for new build, upgrade and repair projects performing work on grid assets, suppliers of equipment and instruments, and service providers.

In 2019, PSE’s counterparties (by contract value) came from:

• 97.5 percent – from Poland,
• 2.5 percent – from EU countries.

Our purchasing policy is pursued in compliance with the following provisions: the Act of 29 January 2004 – Public Procurement Law, together with implementing measures issued to the Act; Directive 2014/25/EU of the European Parliament and of the Council of 26 February 2014 on procurement by entities operating in the water, energy, transport and postal services sectors; Directive 2009/81/EC of the European Parliament and of the Council on the coordination of procedures for the award of certain works contracts, supply contracts and service contracts by contracting authorities or entities in the fields of defence and security; and Commission Interpretative Communication on the Community law applicable to contract awards not or not fully subject to the provisions of the Public Procurement Directives (2006/C 179/02).

All activities carried out by contractors are performed as PSE activities and affect our organisation's image as an investor. For this reason, it is particularly important to maintain high standards and coherent guidelines on the cooperation of contractors with local communities which we take care of every day.

The performance of investment projects involving the construction, expansion and upgrading of network assets is the responsibility of a specialised unit established within our organisation, performing tasks within the framework of the project structure called Central Investment Unit (CJI). It is responsible for the management of investment projects throughout the project life – from the moment the project is included in the Investment Portfolio, through the contract award procedure, to its completion. The CJI purchasing processes are the responsibility of the Public and Non-public Procurement Division (WZ).

The PD plays a leading role in managing and awarding contracts for CIU projects. It also provides advisory and supporting functions to internal customers in all issues related to the management of both non-public and public procurement procedures.

In order to acquire extensive knowledge and to monitor technical solutions appearing in the market, in justified cases the CJI conducts technical dialogues with potential contractors. The technical dialogue (as distinguished from the competitive dialogue) is not a separate procedure, but it is a stage in preparing the contract award procedure.

The benefits arising from the technical dialogue are as follows:

• expanding competition by identifying barriers which could restrict contractors’ access to public contracts,
• defining the best and latest technical, organisational and economic solutions in the field relevant to the object of the contract,
• innovation promotion through the public procurement system, supporting environmentally sustainable, modern and technologically advanced solutions,
• confronting the contracting authority’s needs with the ability of entities providing specific supplies, services or works in the particular market to satisfy those needs,
• preparedness to the performance of the contract, in particular with regard to the detailed definition of its subject-matter, and consequently also ensuring purposeful, rational and economical disbursement of funds,
• identification of the factors determining the technical quality or economic value of a public contract; definition of optimal criteria for the evaluation of bids for the object of the contract required by the contracting authority, and the most suitable legal arrangements relating to the prospective future public procurement agreement to which the technical dialogue applies,
• detailed identification of the costs of public contract award, definition of possible contract risks, their optimal distribution between the contracting parties and an analysis of possible ways of mitigating them.

In order to refine the needs and requirements under the investment projects pursued, the CIU has adopted the competitive dialogue procedure. The competitive dialogue is a contract award procedure in which, after the contract notice, contracting authority conducts a dialogue with selected contractors, and then invites them to submit bids.

The competitive dialogue is a procedure applicable mainly in a situation where procuring entities are able to define their needs and requirements, but are unable to specify how they should be satisfied, and additionally are not able to assess what technical, financial or legal solutions the market can offer them in this regard.

The competitive dialogue can also be useful in the case of works involving the construction of non-standard buildings or in situations where works include design work or innovative solutions and services or supplies which require adaptation or design work.

In order to optimise and standardise, as far as possible, procurement documentation and to increase the contractor market, the Procurement Department prepares standard terms and conditions for participation in investment procedures which, on the one hand, do not constrain the market of potential contractors and, on the other hand, will ensure the secure implementation of investment projects.

Defined this way, the conditions for participation in the procedure will make it possible to prepare procurement documentation faster and more efficiently, and to eliminate significant differences between different contract award procedures.

Standardisation and repeatability of the conditions for participation in the procedure significantly increases the probability of the contracting authority selecting contractors who will guarantee the correct performance (i.e. in accordance with the contracting authority’s expectations) of the object of the contract. It is the contracting authority’s obligation to ensure that the participant eligibility conditions make it possible to select a contractor who gives assurance of the proper performance of the contract, without breaching the principles of equal treatment of contractors and fair competition.

The CIU has introduced additional solutions aimed to guarantee the security of project implementation and cooperation with contractors by applying non-price criteria for the evaluation of bids, making it possible to select the most advantageous instead of the cheapest bid.

1. The criteria applied include the organisation, professional qualifications and experience of the individuals appointed by the contractor to perform the contract if these characteristics significantly affect the quality of the contract performed. The CIU evaluates the qualifications and experience e.g. of the site manager, designers, etc.
   
   The ability to perform a contract may largely depend on the professional value of persons obliged to perform it, and the value also takes into account the professional experience and education of those persons. Thus if a contract is to be performed by a crew, the competence and experience of its members determine the evaluation of capability.
2. 2. Within the framework of non-public procurement procedures conducted in accordance with the PSE Contract Award Procedure it is possible to apply a non-price criterion – the BVP (Best Value Procurement) methodology.
   
   In procedures conducted with the use of the BVP model, the contracting authority evaluates bids in accordance with non-price criteria concerning:
   • the contractor’s effectiveness based on the experience of its personnel defined as organisation, professional qualifications and experience of the persons designated to perform the contract concerned – owing to the fact that personnel characteristics have a significant impact on contract performance quality, and consequently on the economic value of the bid.
   • a description of identified project risks prepared by contractors and a plan for mitigating them,
   • description of the opportunities and value added which the contractor can provide to the contracting authority,
   • a meeting with the contractor, which allows the motivation of the project team to be evaluated, as well as their knowledge of the project, the ability to assess and manage risks related to the project and the value added they can provide.

Each of the above criteria is assigned a weighting and each of them is described on a point-based scale, which makes it easier to arrive at the total score for each contractor. The criteria must be connected with the object of the contract, mainly described in an objective, non-discriminatory and verifiable manner – so that the contracting authority does not have unlimited freedom of their interpretation and evaluation, which would distort the transparency of the process.