VA awards $228.5M contract for Natural Gas Distribution in Kentucky to Constellation NewEnergy

Contract Overview

Contract Amount: $228,528 ($228.5K)

Contractor: Constellation Newenergy - GAS Division, LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-10-01

End Date: 2025-09-30

Contract Duration: 364 days

Daily Burn Rate: $628/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: UTILITIES - NATURAL GAS

Place of Performance

Location: LEXINGTON, FAYETTE County, KENTUCKY, 40502

State: Kentucky Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $228,527.68 to CONSTELLATION NEWENERGY - GAS DIVISION, LLC for work described as: UTILITIES - NATURAL GAS Key points: 1. Significant contract value for natural gas supply. 2. Full and open competition indicates potential for competitive pricing. 3. Firm Fixed Price contract offers cost certainty. 4. Contract duration of 364 days aligns with annual utility needs.

Value Assessment

Rating: good

The contract is a delivery order under a larger agreement, suggesting it's part of an established procurement vehicle. Pricing is likely competitive due to full and open competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The use of full and open competition is a positive sign for price discovery, allowing multiple vendors to bid. This method generally leads to more favorable pricing for the government.

Taxpayer Impact: The competitive nature of the award is expected to yield cost savings for taxpayers compared to non-competitive methods.

Public Impact

Ensures reliable energy supply for VA facilities in Kentucky. Supports energy market competition and potentially local economic activity. Provides stable energy costs for a critical government service.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price volatility if market conditions change significantly despite fixed price.
Dependence on a single supplier for a critical utility.

Positive Signals

Firm Fixed Price contract provides budget certainty.
Full and open competition suggests a well-vetted procurement process.

Sector Analysis

This contract falls within the Utilities sector, specifically natural gas distribution. Spending benchmarks for such services can vary widely based on location, volume, and market conditions.

Small Business Impact

No specific indication of small business participation is provided in the data. Further analysis would be needed to determine if small businesses were involved or could have been.

Oversight & Accountability

The contract is a delivery order under a larger agreement, implying existing oversight mechanisms. The Department of Veterans Affairs is responsible for ensuring contract performance and value.

Related Government Programs

Natural Gas Distribution
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Market price volatility risk
Supply chain disruption risk
Contract performance monitoring
Dependence on a single vendor

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $228,527.68 to CONSTELLATION NEWENERGY - GAS DIVISION, LLC. UTILITIES - NATURAL GAS

Who is the contractor on this award?

The obligated recipient is CONSTELLATION NEWENERGY - GAS DIVISION, LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $228,527.68.

What is the period of performance?

Start: 2024-10-01. End: 2025-09-30.

What is the historical pricing trend for natural gas in Kentucky over the contract period?

Analyzing historical natural gas prices in Kentucky for the period leading up to and during the contract term would provide context for the firm fixed price. Understanding market volatility and trends helps assess if the fixed price is advantageous or potentially disadvantageous given future market expectations.

What is the potential impact of supply chain disruptions on natural gas delivery to VA facilities?

While natural gas is generally reliable, significant disruptions (e.g., extreme weather, infrastructure failures) could impact delivery. The contract's terms regarding force majeure and alternative supply options would be crucial in assessing this risk and its potential impact on VA operations.

How does the awarded price compare to benchmark pricing for similar natural gas contracts in the region?

Benchmarking the awarded price against similar contracts for natural gas in Kentucky or the surrounding region is essential. Comparing the per-unit cost, volume, and service level to industry averages or government databases would reveal if the VA secured a competitive rate and good value for taxpayer money.

Industry Classification

NAICS: Utilities › Natural Gas Distribution › Natural Gas Distribution

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Exelon Corporation

Address: 9400 BUNSEN PKWY STE 100, LOUISVILLE, KY, 40220

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $228,528

Exercised Options: $228,528

Current Obligation: $228,528

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PA0421D0037

IDV Type: IDC

Timeline