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FOR IMMEDIATE RELEASE

U.S. Grant Recipient Prepares to Name Vendors Hidden From Public View

Rockville, MD (April 6, 2012) -- Reliant Energy, a Houston-based retail-electricity provider that skirted a transparency requirement associated with its $19.8 million Smart Grid Investment Grant (SGIG), declared last night it would work with the U.S. Department of Energy (DOE) to publicly disclose the recipients of 53 contracts totaling nearly $3.7 million, Smart Grid Today reported today.

Reliant must first ask for permission from the vendors, each of which got more than $25,000, Bill Harmon, director of Reliant’s DOE smart grid program, said in an exclusive interview with subscription-based Smart Grid Today, adding that he did not anticipate any pushback.  Reliant plans to hand that for-publication list to DOE next week, he said.

“We [previously] informed the Department of Energy we would not be providing the specific vendor names and that we would behave as we had and provide the type of businesses,” Harmon said yesterday.  “We never had received feedback until today.”

Smart Grid Today last week asked DOE about Reliant’s SGIG reporting on Recovery.gov after the firm declined to name the vendors for an article Smart Grid Today published Monday. 

Of the 99 SGIG winners, Reliant was the only firm that awarded contracts for $25,000 or more and failed to publicly disclose which vendors landed those deals, according to a Smart Grid Today review of public documents this week.

Reliant’s actions violated American Recovery & Reinvestment Act (ARRA) and Office of Management and Budget (OMB) reporting guidelines, DOE’s public relations department told Smart Grid Today Wednesday. 

“Recipients are required to meet certain reporting requirements each quarter, including identifying vendors that have received payments of over $25,000,” DOE said.  “The Energy Department is aware that Reliant considers some of its vendor relationships to be proprietary.  Reliant's current quarterly report is not meeting the reporting requirement for identifying vendors, and the Department is working with Reliant to resolve the situation.”

Those discussions evolved yesterday and ended with Reliant agreeing to meet the federal reporting requirements.

Reliant expects a quick turnaround for posting on Recovery.gov the names of the vendors it paid nearly $3.7 million, Harmon told Smart Grid Today.

Exception made, Reliant says

Reliant accepted the SGIG on the condition that it could withhold the name of its vendor partners and signed an accord to that extent with DOE, Harmon said last night.  Since it operates in a competitive market with dozens of retail-electricity providers vying for customers, Reliant viewed its deals with vendors as proprietary information and made confidentiality agreements.

Early yesterday, Pat Hammond, a Reliant spokesperson, told Smart Grid Today such an agreement existed between the Houston-based retailer and DOE.  “We provide timely and accurate reporting to the DOE on a number of different reports that are required on our smart grid grants,” she said.  “The only place the information was not provided was on the public website.”

When Smart Grid Today relayed Hammond’s comment to DOE yesterday, the agency’s public relations staff responded, “Our previous statement stands on this.” 

When informed last night of DOE’s retort, Harmon said, “I can’t resolve for you them standing by those words.  That’s their comment and that’s fine, we understand that.  We’ve talked to them a number of times on the particular topic.”

Tendril given as example

Many of the partnerships in question were for “commercially sensitive materials” at the time DOE awarded the SGIG, Harmon said.  Most of the products and services Reliant was working on were not ready for the market and thus would have put it at a competitive disadvantage by revealing the prices it paid and the types of vendors with whom it was working, he added.

Now that those products and services are available for customer use, Reliant sees no harm in disclosing its vendors, Harmon said. 

For example, Reliant was working with Tendril soon after landing its SGIG, he said.  That was a secret then to the firm’s competitors, but now it is common knowledge considering Reliant customers can sign up for Tendril-backed home energy management systems, he noted.  

“Two years ago,” Harmon said, “I wouldn’t have wanted that public.”

ARRA outlined ‘remedial actions’

DOE, under Section 1512 of ARRA, could have taken punitive action against Reliant if it refused to reveal award winners.

“The awarding agency may use any customary remedial actions necessary to ensure compliance, including withholding funds, termination, or suspension and debarment, as appropriate,” according to OMB documents.  A September 2010 OMB memo stated that “no rate of non-compliance is acceptable and each case of non-compliance will be addressed.”

As of Dec 31, Reliant had invoiced for and spent about $11.5 million of its $19.8 million SGIG, according to Recovery.gov.

Reliant so far has enrolled more than 450,000 customers in smart grid programs, which puts the $63.7 million project “on track to significantly exceed the program goals, Reliant told the US government.

Rules require transparency

ARRA reporting requirements, as described in Section 1512 of ARRA, clearly state that grant recipients “must report” the vendor, the amount paid to the vendor and what was received for payment for all awards of at least $25,000.  

Section 1512 goes on to state that reporting of stimulus dollars is intended to answer the following questions: “Who is receiving Recovery Act dollars and in what amounts?  What projects or activities are being funded with Recovery Act dollars?  What is the completion status of such projects or activities and what impact have they had on job creation and retention?”

OMB allows extensions for meeting reporting deadlines for various reasons, such as natural disasters, but explicitly notes no recipient can get a waiver for such reporting.

About Smart Grid Today
Smart Grid Today's mission is to deliver daily, unbiased, comprehensive and original reporting on emerging trends, applications and policies driving the modern utility industry -- in a signature format that features highly concise and easy-to-understand news copy based on trusted reporting, exclusive interviews, informed analysis and strategic insights that our subscribers rely on to succeed every business day.  Smart Grid Today is published 247 times a year by Modern Markets Intelligence, Inc. (MMI), which specializes in independent trade news for the evolving energy industry of the 21st century.  MMI is located in Rockville, Md.  For more information, visit www.smartgridtoday.com.

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