The emails I’m getting tell me he didn’t. Yow!
Bartoletti’s aticle in this morning’s Pioneer Press, School energy pacts debated, missed some key problems with how District 211 administrators explained their decision to contract for electricity with the increasingly controversial Illinois Energy Consortium, according to emails I’m receiving today from concerned D211 parents.
One part of Bartoletti’s article that is raising eyebrows is his reference in two of the first three paragraphs to “for-profit” suppliers.
At issue is what Elementary School District 15 pays for its energy with a for-profit supplier compared to District 211.
A reader commented:
Bartoletti drank the 211 kool-aid. Why should we care if the suppliers make a profit or not, as long as we save the most money possible on electricity? The whole idea that there is something holy and glorious about the IEC being non-profit is a joke when you consider the millions of dollars in referral fees they pay to their sponsors.
Diane Rado’s March 5 article in the Chicago Tribune exposed, for the first time, that the IEC’s sponsoring organizations did receive millions of dollars in such fees.
This Bartoletti paragraph is also drawing scorn:
In comparing the rates and anticipated usage, District 211 officials say the district would save $59,000 through the consortium as compared to what they might pay under District 15′s contract.
A reader emailed:
What they MIGHT have paid? What they MIGHT have paid?? What’s that even supposed to mean? If they knew the real comparison they would have compared it to what District 15 WOULD have paid under its contract.
From the standpoint of someone who is trying to defend the fact that District 211 got into an electricity contract with the IEC, probably the strongest argument made in their defense in the article is the claim that it’s impossible to pin electricity costs down:
Mohsin Dada, Elementary School District 54 assistant superintendent of business services, said….”we have not seen any process where you could have a legal bid for (utilities) because pricing for electricity is usually good for about 24 hours,” Dada said. “So we did a (sealed) request for proposal.”
The point here, reinforced elsewhere in the article, is that the right way for a district to get the best prices for electricity is not through a fixed bid process but through a request for proposals. Bartoletti explains how other districts, like District 15, went through such a process, receiving a number of bids, ultimately choosing suppliers other than the IEC.
Whatever you want to call the right process for school districts to go through to get the best price for electricity, clearly the fact that pricing for electricity changes every 24 hours (if that is true) doesn’t change the fact that these school districts are obviously able to get bids from suppliers that make it perfectly easy to figure out which one is going to provide the lowest price for the period of time asked for by the school district.
The article doesn’t help in distinguishing two competely separate questions:
(1) Under the contract with the IEC, is D211 saving as much on electricity as it would have saved had it solicited and considered bids from a wider array of competitors?
(2) Did the process that D211 went through to get into a contract with the IEC violate state law?
Superintendent Roger Thornton and other D211 reps argue both that D211 is getting the best possible price from the IEC and that D211 did not break the law.
I don’t have the faintest idea whether it broke the law. However, I will note that Thornton’s defense:
…if we’ve broken the law, so have (all of the districts in Illinois.)”
is hardly very persuasive. By the way, it would only be the districts that entered into contracts with the IEC without getting bids or proposals from their competitors that might (as Mario Bartoletti would say) have broken the law. The other districts? The ones that sought and considered proposals from a variety of suppliers and then chose those other suppliers? They didn’t break any laws.
A District 211 representative also makes the case that D211 is savings tons of money because of its contract with the IEC:
“Over a five-month period, we have saved about $133,000,” Torres said. “We project to save $1.6 million by May 2008.” The savings are measured with rates from ComEd, the district’s previous energy supplier.
Are you starting to feel like you’re in an episode of The Twilight Zone? What about all the competitors whose rates are considerably lower than those ComEd rates?
District 211 officials…said the district has already saved money with the consortium, with additional savings coming to the school district because it was one of the first districts to join the consortium after electric deregulation.
What a joke. This makes it sound like D211 is paying less for its IEC electricity than districts that joined later. So? I feel bad for those school districts that are paying even more for electricity from the IEC than D211 is but the real question is how much D211 would have paid if it had asked for proposals from one of the IEC’s many real competitors…the ones who seem to easily be able to provide proposals to Districts like District 15 somehow, magically, in spite of the fact that electricity rates “change every 24 hours.”
District 211 Superintendent Roger Thornton said the selection process used by the district was as open as those in other districts.
“We did three requests for proposal,” he said. “Our Board of Education is the one that took the final action in public session.”
Really? They did three requests for proposal? Can I see the documentation on that? Did Mario Bartoletti ask for any documentation on that? If there really were three requests for proposal, wouldn’t the lawsuit have been tossed out by the judge?
I don’t know but based on how Tom Petersen, the community relations director for District 211, reacted the last time I asked him a basic question, he’d tell me to file an open records request if I want to know the answer.
Thornton said. “And when the lawsuit began, the indication was that we had exposed the taxpayers to egregious risk. In fact, we’ve saved a lot of money, so the basic context of the lawsuit is moot.”
Saved money? Compared to ComEd? What about compared to MidAmerican, or Sempra, or ConstellationNewEnergy?
Did Mario Bartoletti ask those questions?
Did he interview any energy industry insiders or someone who might be able to shed some light on how fixed bids work in industries with shifting markets?
From the article, it doesn’t appear so.
Someone should make him a t-shirt that says,
“Mmmm. This Kool-Aid is DEEEElicious.”