Summary#
Montréal city council unanimously adopted a position on a proposed framework agreement (a standing supply contract) with Produits Suncor Énergie, s.e.n.c. The agreement would supply clear diesel and diesel containing renewable fuel for 36 months, with two 12-month extension options; the agglomeration council makes the final decision at a later meeting. City staff say the goal is to meet fuel needs for city operations and participating linked municipalities.
- Suncor would supply fuel to the City of Montréal on demand, for a maximum of 41 944 604,63 $, taxes included.
- The decision also authorizes 6 291 690,69 $, taxes included, for contingencies. The estimated total is 48 236 295,32 $, taxes included.
- The fuel would be available to city departments, boroughs and the 12 linked municipalities that joined the purchase group.
- The city must evaluate Suncor’s performance under the contract.
- The contract was awarded through a public call for tenders. Three bids were received; Suncor was the lowest compliant bidder.
What it means for you#
- City departments, boroughs and participating linked municipalities: They would be able to order the fuels as needed. Their budgets would pay for the fuel as needs arise. The listed quantities are estimates, not a commitment to buy a set amount.
- Suncor: If the agglomeration council approves the agreement, the company would supply the fuels on demand under the tender terms.
- Residents and other businesses: The decision does not directly change household fuel rules, taxes or services.
Money#
The estimated total is 48 236 295,32 $, taxes included, including a 6 291 690,69 $ contingency budget.
- The agreement amount for fuel is capped at 41 944 604,63 $, taxes included.
- Prices would be adjusted each week using a published Québec energy price index. Transport and delivery costs are firm for the first year; later increases may be limited by Montréal’s consumer price index and must be justified to the buyer’s satisfaction.
- Any change in federal or provincial fuel taxes would apply when it takes effect.
- The decision does not give a final cost: actual spending depends on orders, fuel prices and whether extension options are used.
What is unclear#
- The exact quantities to be purchased are not set. The tender quantities are estimates and do not bind the city to buy them.
- The materials do not state what share of the diesel must be renewable fuel.
- The materials do not say how the estimated cost would be divided among the participating budgets.
- The final cost could change with weekly fuel prices, taxes, actual demand and any extensions.
Case for#
- City staff say the agreement would help keep fuel supplies consistent and make purchasing easier.
- Staff say returning to tender produced prices 10% lower. In the comparison provided, Suncor’s bid was 7.09% below the city’s latest estimate and 7.33% below the other compliant bid.
- Buying together may let participating city units and linked municipalities use one supply agreement.
Case against#
- Only three of the nine organizations that obtained the tender documents submitted bids. The staff summary lists barriers cited by some non-bidders, including required guarantees and the pricing index.
- The total is an estimate, not a fixed final bill: quantities are not guaranteed, and fuel prices and taxes can change.
- The materials do not specify the renewable-fuel share, making it hard to judge how much of the supply would contain renewable fuel.