DOJ's $65.6M Electric Power Contract Awarded to ALLETE, INC. for Federal Prison System
Contract Overview
Contract Amount: $65,597 ($65.6K)
Contractor: Allete, Inc.
Awarding Agency: Department of Justice
Start Date: 2026-04-01
End Date: 2026-06-30
Contract Duration: 90 days
Daily Burn Rate: $729/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: SST-P4/P6-MN POWER-Q3-FY26 APRIL 1, 2026, THROUGH JUNE 30, 2026 AMOUNT EST/METERED INV QUANTITIES
Place of Performance
Location: DULUTH, SAINT LOUIS County, MINNESOTA, 55802
Plain-Language Summary
Department of Justice obligated $65,597.4 to ALLETE, INC. for work described as: SST-P4/P6-MN POWER-Q3-FY26 APRIL 1, 2026, THROUGH JUNE 30, 2026 AMOUNT EST/METERED INV QUANTITIES Key points: 1. ALLETE, INC. secured a $65.6 million contract for electric power distribution. 2. The contract is for the Federal Prison System / Bureau of Prisons in Minnesota. 3. This is a firm-fixed-price purchase order with a 90-day duration. 4. The award was not available for competition, raising potential value concerns.
Value Assessment
Rating: questionable
The contract amount is $65,597.40 for a 90-day period. Without specific unit quantities or a clear benchmark for electric power distribution in a correctional facility setting, assessing value is difficult. The 'EST/METERED INV QUANTITIES' notation suggests potential variability.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract states 'NOT AVAILABLE FOR COMPETITION,' indicating a limited competition approach. This lack of open bidding may hinder price discovery and potentially lead to higher costs for taxpayers.
Taxpayer Impact: The limited competition raises concerns about whether the government secured the best possible price for essential utility services.
Public Impact
Ensures continuous power supply to federal correctional facilities, critical for operations and safety. Impacts inmates and staff by maintaining essential services like lighting, heating, and security systems. Supports the operational needs of the Bureau of Prisons in Minnesota.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potential for overpayment due to limited price discovery
- Short contract duration may not reflect long-term needs
Positive Signals
- Ensures essential service delivery
- Firm fixed price provides cost certainty for the period
Sector Analysis
The energy sector, specifically electric power distribution, is crucial for government operations. Utility contracts can vary significantly in price based on location, demand, and competitive landscape. This contract falls within the typical range for essential utility services for a facility of this nature.
Small Business Impact
The data does not indicate any specific provisions or considerations for small businesses in this contract award.
Oversight & Accountability
The 'NOT AVAILABLE FOR COMPETITION' status warrants further review to ensure proper justification and adherence to procurement regulations. Oversight should confirm the necessity of this limitation.
Related Government Programs
- Electric Power Distribution
- Department of Justice Contracting
- Federal Prison System / Bureau of Prisons Programs
Risk Flags
- Limited competition
- Lack of clear unit pricing
- Potential for cost overruns if usage is high
- Short contract duration may lead to frequent re-procurement costs
Tags
electric-power-distribution, department-of-justice, mn, purchase-order, under-100k
Frequently Asked Questions
What is this federal contract paying for?
Department of Justice awarded $65,597.4 to ALLETE, INC.. SST-P4/P6-MN POWER-Q3-FY26 APRIL 1, 2026, THROUGH JUNE 30, 2026 AMOUNT EST/METERED INV QUANTITIES
Who is the contractor on this award?
The obligated recipient is ALLETE, INC..
Which agency awarded this contract?
Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).
What is the total obligated amount?
The obligated amount is $65,597.4.
What is the period of performance?
Start: 2026-04-01. End: 2026-06-30.
What is the justification for the contract not being available for competition, and what steps were taken to ensure fair pricing?
The justification for 'NOT AVAILABLE FOR COMPETITION' is critical. Agencies must demonstrate that only one source can fulfill the requirement due to unique capabilities, urgent needs, or specific circumstances. Without this information, it's difficult to assess if fair and reasonable pricing was achieved through alternative means, such as historical data or market research.
How does the 'EST/METERED INV QUANTITIES' impact the final cost and taxpayer exposure?
The 'EST/METERED INV QUANTITIES' suggests that the final invoiced amount will be based on actual metered usage, with an initial estimate. This introduces variability in the total cost. While it can prevent overpayment if usage is lower than estimated, it also means the final cost is not fixed, and taxpayers are exposed to the actual consumption levels.
What is the benchmark for electric power distribution costs for similar federal facilities in Minnesota?
Benchmarking electric power distribution costs for similar federal facilities in Minnesota is essential for evaluating the reasonableness of ALLETE, INC.'s contract. Without access to comparative data on price per kilowatt-hour or total cost per facility size and occupancy, it is challenging to determine if this $65.6 million contract represents a good value or if potential cost savings were missed.
Industry Classification
NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 30 W SUPERIOR ST, DULUTH, MN, 55802
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $65,597
Exercised Options: $65,597
Current Obligation: $65,597
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Timeline
Start Date: 2026-04-01
Current End Date: 2026-06-30
Potential End Date: 2026-06-30 00:00:00
Last Modified: 2026-04-02
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