Britain's publicly owned energy system operator has awarded Palantir a £21.2 million contract without competition, extending a relationship that began under private ownership three years earlier.

The National Energy System Operator (NESO) handed the US spy-tech firm the £17.7 million contract – £21.2 million including VAT – to continue licensing and supporting two "critical business processes," Connections and Skip Rates, running on its Foundry platform.

NESO said it was preparing a competitive procurement for a replacement platform but needed to continue working with Palantir in the meantime to avoid disruption to customer-facing services and regulatory obligations.

"A contract will be put in place to enable continuity of the existing critical platform services whilst a competitive procurement is undertaken," a tender notice said.

The organization has already begun sounding out potential suppliers.

"Palantir possesses the specialist knowledge, technical expertise and the system knowledge required to maintain and support the solution effectively," the notice said.

The Financial Times reported that the original contract began in March 2023 but was not publicly disclosed. NESO said it was not required to publish the award because it was still part of privately owned National Grid at the time. The Register offered both organizations the opportunity to comment.

The new contract is due to run from September 8, 2026, until July 31, 2027, with six-month extensions available until July 31, 2028.

"Due to the complexity of legacy data structures and potential security, data quality, or regulatory compliance issues, the data modelling process may encounter unforeseen challenges. Should these risks materialize and impact data integrity, security, regulatory compliance and/or the successful transition of services, the contract may be modified, including to extend the transition timeline," the notice said.

NESO was established under the Energy Act 2023 as an operationally independent public corporation responsible for coordinating and planning Great Britain's electricity and gas systems. It is wholly owned by the government but funded through regulated industry charges.

According to a "preliminary market engagement notice," it has begun discussions with suppliers about a new Strategic Enterprise Modelling Capability.

The proposed platform would provide enterprise-wide modeling, decision support, audit trails showing how source data informed decisions, and tools for comparing scenarios. The notice, published last month, also mentions "AI-enabled innovation."

The resulting contract is expected to begin on July 31, 2027, and run until July 2032, with a possible two-year extension.

Palantir told The Reg: “We’re proud to be supporting Neso’s efforts to improve energy efficiency, drive down costs and transition to net zero.”

The procurement path has echoes of Palantir's route to the NHS Federated Data Platform (FDP). Following a competitive process, the company won the principal contract, worth up to £330 million ($412 million), while several consultancies secured related awards. That award followed £60 million in contracts handed to the US company during and after the pandemic, some without competition.

Critics argued that Palantir's incumbency allowed it to influence the later procurement and gave it an unfair advantage. The NHS maintained that the FDP competition was fair and open. ®