Controversy with a major procurement contract at state-owned power company Electrica. Meters imported from China not in conformity/Husband of Electrica CEO works at company that won the contract

contoare Electrica SA

A contract signed in 2020 by a branch of the state-owned company Electrica SA for the purchase of smart meters has reached a stalemate. The framework agreement worth almost 40 million lei is blocked due to compliance problems for the meters imported from China, with payments on hold, according to the response from Electrica SA.

The contract raised questions about compliance with the integrity rules from the beginning, as the husband of the general manager of Electrica SA is the director for industrial clients services at the supplier company that won the contract to supply the meters to Electrica.

Based on the information available on the public procurement system SICAP, the framework agreement estimated in 2020 at 39.9 m lei to 51.8 m lei was awarded to Cluj-Napoca company Energobit. Based on the framework agreement, a subsequent contract is signed for the supply of single-phase and three-phase power meters.

The first problem surrounding the contract 

The first controversy arose shortly after signing the contract. Some of the meters provided under the contract, respectively 794 three-phase power meters are not compliant with the initial bidding proposal. More exactly, the Chiese meters are class C precision according to EU-type certificate, but the requested in the tender in the procurement documentation, and technical offer, specifically requires Class-B precision.

The Romanian Bureau of Legal Metrology, notified by the Transilvania Nord Electricity Distribution Company, confirmed the compliance issue, showing that “placing on the market is not in accordance with the legal provisions”.

In a request for comment, the stated-owned Electrica SA told Economedia that there is no risk of erroneous measurement of electricity by these meters, as the accuracy class certified by the accredited body and specified in the EU Type Certificate is higher than that specified in the Declaration of Conformity in the tender process.

In short, Electrica SA claims that the equipment provided is better than that in the tender specifications. On the other hand, the Romanian Bureau of Legal Metrology shows that the equipment delivered is different from that one requested in the tender which required a certain type of equipment.

In fact, the problem with this delivery of this equipment with different specifications from that initially required, even if, in theory, it’s better, is that the bidding process has been potentially distorted: if the other participants in the bidding process could have delivered different equipment than that specified in the requirements, then the result of the bidding process could also have been a different one, with a different bidder winning the bid.

At this moment, the installation of the equipment is completely blocked until the situation is resolved, according to Electrica SA.

Moreover, Electrica SA shows that “the commissioning process for these meters was suspended until the clarification of the issues related to the introduction of this type of meter on the market and no payments were made”, adding that “the works will be completed and formally accepted only after the complete remediation by the manufacturer/supplier of the mentioned aspects and the written confirmation from the Romanian Bureau of Legal Metrology ”.

The second problem with the contract: the husband of Electrica director works for the company that won the tender

The general manager of Electrica SA, the parent company of the Transilvania Nord Electricity Distribution Company, is Corina Popescu. At the time of the conclusion of the contract, she was also a member of the Board of Directors of Electricity Distribution Transilvania Nord, according to her public asset declaration. Information in the same declaration shows that Corina Popescu’s husband is an employee of Energobit SA, the company that won the contract to supply the electric meters. According to information provided by Electrica, he is the director of services for industrial customers.

According to the internal regulations within the Transilvania Nord Electricity Distribution Company, the policy of delegating the attributions stipulates that any contract with a value of more than 3 million euros must be approved by the Board of Directors, of which Corina Popescu was part of at that time, according to her the public asset declaration.

Asked by if the awarding of the electricity meter contract raises integrity issues, Electrica SA says that the name of Mrs. Corina Popescu is not found among the signatories of the contract. In addition, Electrica SA shows that the company Energobit, which won the bidding and the award of the framework agreement, “is not legally represented” by Corina Popescu’s husband.

Context. Electrica SA is the largest player in the electricity distribution and supply market in Romania. The Romanian state holds 48.7% of the shares, through the Ministry of Energy. The European Bank for Reconstruction and Development EBRD holds 5% of the shares, the rest of the shares being held by private investors. The company is listed on the Bucharest and London stock exchanges.

Translated from Romanian by Service for Life SRL

Foto: Contoarele inteligente ale sucursalei Electrica SA

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