IAEA Activities Related to Bidding and Bid Evaluation John H. Moore Nuclear Power Engineering Section j.h.moore@iaea.org VIE2012/9002/01 Meeting March 23-26, 2015 Hanoi, Vietnam

It’s great to be back in Hanoi!

Topics to be covered Publications Bid evaluation assistance, including: New BIDEVAL toolkit (in progress)

Publications

Recall issued publications

Update since December 2014 workshop Procurement Engineering and Supply Chain Guidelines (new NP-T-3.21) has been approved for publishing; Includes: Typical procurement processes; Considerations of special importance and lessons learned; Procurement of services; Procurement of software; Counterfeit and fraudulent items; Proactive methods for new NPPs. More related to O&M purchasing, not new NPPs, but many similarities exist.

NP-T-3.21 Procurement Model

Bid evaluation assistance

General principle of bidding process; Bid invitation specifications; Invitation and Evaluation of Bids for Nuclear Power Plants (NG-T-3.9, 2011) General principle of bidding process; Bid invitation specifications; Bid evaluation process; Technical bid evaluation; Economic bid evaluation; Contracting.

Basic bidding process (from NG-T-3.9)

BIDEVAL Toolkit BIDEVAL 3 software prepared in 1990’s to assist Member States in comparing and evaluation bids; Platform has become outdated and difficult/impossible to update; Decision made to initiate new project on Bid Evaluation starting in 2015; Project will produce a web-based “toolkit” of easy to use model forms/spreadsheets to assist in various aspects of the bid process.

Potential model – Scottish Government Procurement site http://www.gov.scot/Topics/Government/Procurement/buyer-information/spdlowlevel/routetwotoolkit

New toolkit status First consultancy meeting held February 2015; Representatives from Canada, Lithuania, South Africa,, Switzerland, USA and Vietnam (Mr. Viet Dinh Ninh); Preliminary process draft for toolkit developed.

New toolkit process Prerequisite activities Procurement governance framework Preliminary business case Decide on contracting approach Develop & authorize procurement strategy Customize procurement processes Identify key stakeholders Develop process evaluation criteria Develop and approve bid invitation specification Handover BIS to procurement agency Supplier selection Invitation to tender Evaluate bids Bid clarifications Rank bidders and identify preferred bidder Independent review Issue tender Hold open vendor meeting Vendor enquiries Receive and open bids Initiate negotiations with preferred bidder Update business case Make final investment decision Award contract Post award meeting Contract management and oversight Lessons learned documentation Preparing for commissioning and operation

Next steps Further refine process steps; Add and develop available assistance tools, including: Samples of evaluation criteria and weightings used on various projects. Develop web site ‘look and feel’; Expected availability – 2016.

Evaluation criteria examples Country 1 Country 2 Country 3 Design maturity Payment offer for site (credit for % of consortium) Technical factors (20%) -safety -construction risk -passive safety features -etc. Regulatory complexity / regulatory risk Equity offering Industrial development (30%) -jobs -investment Evaluated capacity factor Commitment on any project cost overrun Financial (30%) -LUEC -Tariff LUEC (Levelized Unit Energy Cost) Ability to meet schedule Financing support (10%) Local content Technical due diligence Equity investment (10%) Grid integration Compliance with draft model agreement Decommissioning and waste management

ISO 10845-1 Table 3 Methods Financial offer Financial offer and quality Financial offer and preferences Financial offer, quality, and preferences

Other potential expert missions IAEA cannot participate in evaluation of specific bids, but can: Provide experts to comment on completeness of a BIS, evaluation criteria, or other topics in advance of a tender being issued; Note: expert views from such missions are their own opinions based on their expertise, not official IAEA recommendations, policy or standards.

Notable references from draft toolkit IAEA NG-G-3.1 Milestones in the Development of a National Infrastructure for Nuclear Power IAEA NG-T-1.4 Stakeholder Involvement Throughout the Life Cycle of Nuclear Facilities IAEA NG-T-3.1 Initiating Nuclear Power Programmes: Responsibilities and Capabilities of Owners and Operators IAEA NG-T-3.3 Preparation of a Feasibility Study for New Nuclear Power Projects IAEA NG-T-3.7 Managing Siting Activities for Nuclear Power Plants IAEA NG-T-3.9 Invitation and Evaluation of Bids for Nuclear Power Plants NP-T-3.21 Procurement Engineering and Supply Chain Guidelines in Support of Operation and Maintenance of Nuclear Facilities IAEA INSAG-20 Stakeholder Involvement in Nuclear Issues IAEA TRS-275 Bid Invitation Specifications for Nuclear Power Plants, A Guidebook IAEA TRS-204 Technical Evaluation of Bids for Nuclear Power Plants, A Guidebook IAEA TRS-396 Economic Evaluation of Bids for Nuclear Power Plants, A Guidebook ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD) Anti-Corruption Ethics and Compliance Handbook for Business (2013) ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT (OECD) OECD Guidelines for Multinational Enterprises (2011)

Notable references (cont.’d) THE INSTITUTE FOR PUBLIC PROCUREMENT (NIGP) and THE CHARTERED INSTITUTE FOR PURCHASING AND SUPPLY (CIPS), Ethical Procurement (2012); BRITISH STANDARDS INSTITUTE, BS 8903:2010 Principles and framework for procuring sustainably. Guide WORLD BANK INTERNATIONAL FINANCE CORPORATION (IFC), Performance Standards on Environmental and Social Sustainability (2012) CONSTRUCTION INDUSTRY INSTITUTE (CII), IR 304-2 A Framework for Sustainability during Construction (2014) ISO 10845-1 Construction procurement – Part 1: Processes, methods, and procedures ISO 31000 Risk Management IEC 31010 Risk management -- Risk assessment techniques EPRI guide Advanced Nuclear Technology: Supplier Quality Management for New Nuclear Plant Construction Projects, Report 3002000521 Construction Industry Institute: IR 181-2 IPRA International Project Risk Assessment, Austin: CII, 2003. Construction Industry Institute: IR 280-2 Applying Probabilistic Risk Management in Design and Construction Projects, Austin: CII, 2013. Construction Industry Institute: IR 210-2–Equitable Risk Allocation: Two-Party Risk Assessment and Allocation Model

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