GSA awards $217M energy retrofit contract to Ameresco Inc. for 25 federal buildings across four Midwest states

Contract Overview

Contract Amount: $217,262,240 ($217.3M)

Contractor: Ameresco Inc

Awarding Agency: General Services Administration

Start Date: 2025-01-16

End Date: 2043-12-31

Contract Duration: 6,923 days

Daily Burn Rate: $31.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 13

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ENERGY SAVINGS PERFORMANCE CONTRACT, NATIONAL DEEP ENERGY RETROFIT PROGRAM ROUND 7, REGION 5 FOR IMPLEMENTATION OF ENERGY CONSERVATION MEASURES AT THE BEAN FEDERAL CENTER, INDIANAPOLIS AND 24 OTHER BUILDINGS INDIANA, ILLINOIS, MINNESOTA AND WISCONSIN

Place of Performance

Location: INDIANAPOLIS, MARION County, INDIANA, 46249

State: Indiana Government Spending

Plain-Language Summary

General Services Administration obligated $217.3 million to AMERESCO INC for work described as: ENERGY SAVINGS PERFORMANCE CONTRACT, NATIONAL DEEP ENERGY RETROFIT PROGRAM ROUND 7, REGION 5 FOR IMPLEMENTATION OF ENERGY CONSERVATION MEASURES AT THE BEAN FEDERAL CENTER, INDIANAPOLIS AND 24 OTHER BUILDINGS INDIANA, ILLINOIS, MINNESOTA AND WISCONSIN Key points: 1. Contract aims to achieve significant energy and water savings through deep energy retrofits. 2. Ameresco Inc. has a track record in energy performance contracting. 3. The contract duration of over 18 years suggests a long-term commitment to energy efficiency. 4. The firm-fixed-price structure shifts performance risk to the contractor. 5. This award is part of a larger federal initiative to modernize building infrastructure and reduce energy consumption. 6. The scope covers multiple states, indicating a regional approach to energy conservation.

Value Assessment

Rating: good

The total contract value of $217.26 million for a period of over 18 years represents a substantial investment in energy conservation measures. While specific performance metrics and achieved savings are not detailed here, the firm-fixed-price nature of the contract implies that the contractor, Ameresco Inc., is responsible for delivering the agreed-upon energy savings. Benchmarking against similar large-scale federal energy retrofit programs suggests this award is within a typical range for comprehensive building modernization projects. The General Services Administration (GSA) often leverages Energy Savings Performance Contracts (ESPCs) to achieve cost-effective energy upgrades.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified contractors had the opportunity to bid. The presence of 13 bids suggests a competitive marketplace for energy performance contracting services. A robust competition level generally benefits the government by fostering price discovery and encouraging contractors to offer competitive terms and innovative solutions to win the contract.

Taxpayer Impact: The full and open competition for this significant contract is beneficial for taxpayers as it likely resulted in a more favorable price and better terms compared to a sole-source or limited competition award.

Public Impact

Federal agencies occupying the Bean Federal Center and 24 other buildings will benefit from modernized infrastructure and potentially lower utility costs. The contract will deliver energy conservation measures, including upgrades to lighting, HVAC systems, and building envelopes, leading to reduced energy and water consumption. The geographic impact spans Indiana, Illinois, Minnesota, and Wisconsin, supporting federal sustainability goals across the Midwest region. The project is expected to create or sustain jobs in engineering, construction, and energy management services within the affected states.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration could lead to scope creep or unforeseen cost increases if not managed meticulously.
Reliance on a single contractor for a large-scale, multi-year project carries inherent execution risks.
The effectiveness of energy savings will depend on the accuracy of the baseline energy usage and the contractor's implementation capabilities.

Positive Signals

The firm-fixed-price contract shifts the financial risk of cost overruns to the contractor.
Awarding to an experienced ESPC provider like Ameresco Inc. suggests a higher likelihood of successful project delivery.
The contract is part of a structured federal program (National Deep Energy Retrofit Program Round 7), implying established processes and oversight.

Sector Analysis

This contract falls within the Engineering Services sector (NAICS 541330), specifically focusing on energy efficiency and building retrofits. The market for energy performance contracting is substantial, driven by government mandates and private sector sustainability initiatives. Federal agencies are significant consumers of energy, and programs like this are crucial for meeting energy reduction targets and modernizing aging infrastructure. Comparable spending benchmarks for large-scale federal ESPCs often range in the tens to hundreds of millions of dollars, depending on the scope and number of facilities involved.

Small Business Impact

This contract was awarded under full and open competition and does not indicate any specific small business set-aside. While the prime contractor, Ameresco Inc., is a large business, there may be opportunities for small businesses to participate as subcontractors in the implementation of the energy conservation measures, particularly in areas like construction, electrical work, and specialized equipment installation. The extent of small business subcontracting will depend on Ameresco's procurement strategy.

Oversight & Accountability

Oversight for this contract will primarily be managed by the General Services Administration (GSA), specifically its Public Buildings Service. As an Energy Savings Performance Contract (ESPC), the agreement likely includes detailed performance metrics, measurement, and verification (M&V) protocols to ensure that the guaranteed energy savings are achieved. The firm-fixed-price nature places the onus on the contractor to meet these targets. Transparency is generally maintained through contract reporting requirements and public contract databases.

Related Government Programs

Energy Savings Performance Contracts (ESPCs)
National Deep Energy Retrofit Program
Federal Building Modernization Initiatives
GSA Public Buildings Service Programs
Energy Conservation Measures Implementation

Risk Flags

Contract Duration
Performance Risk
Scope Definition

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $217.3 million to AMERESCO INC. ENERGY SAVINGS PERFORMANCE CONTRACT, NATIONAL DEEP ENERGY RETROFIT PROGRAM ROUND 7, REGION 5 FOR IMPLEMENTATION OF ENERGY CONSERVATION MEASURES AT THE BEAN FEDERAL CENTER, INDIANAPOLIS AND 24 OTHER BUILDINGS INDIANA, ILLINOIS, MINNESOTA AND WISCONSIN

Who is the contractor on this award?

The obligated recipient is AMERESCO INC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $217.3 million.

What is the period of performance?

Start: 2025-01-16. End: 2043-12-31.

What is Ameresco Inc.'s track record with similar federal energy performance contracts?

Ameresco Inc. is a well-established energy service company with extensive experience in federal energy performance contracts. They have a history of working with various federal agencies, including the Department of Defense, Department of Energy, and GSA, on projects involving deep energy retrofits, renewable energy installations, and smart building technologies. Their portfolio includes numerous ESPCs that have successfully delivered guaranteed energy and operational savings. Publicly available data and past performance reviews often highlight their capabilities in project development, implementation, and long-term performance verification. However, like any large contractor, specific project outcomes can vary, and a detailed review of their past federal contracts would provide a more granular understanding of their performance across different project types and scales.

How does the $217 million contract value compare to other federal deep energy retrofit programs?

The $217.26 million contract value for this GSA National Deep Energy Retrofit Program award is substantial and aligns with the scale of comprehensive, multi-building energy modernization projects undertaken by the federal government. Large-scale ESPCs, especially those involving deep retrofits across numerous facilities and spanning over a decade, frequently fall within this range. For instance, similar programs managed by the Department of Energy or the Department of Defense for large campus environments or portfolios of buildings have seen contract values exceeding $100 million and sometimes reaching several hundred million dollars. The value is driven by the scope of work, the number and size of buildings, the complexity of the retrofits (e.g., HVAC, lighting, building envelope, controls), and the duration of the performance period. This award appears consistent with the federal government's commitment to significant investments in energy efficiency.

What are the primary risks associated with a firm-fixed-price contract of this duration?

The primary risks associated with a firm-fixed-price contract of this 18-year duration primarily lie with the contractor, Ameresco Inc., but can indirectly impact the government. For Ameresco, the risk includes accurately estimating all costs over such a long period, including potential inflation, technological obsolescence, and unforeseen site conditions. If their costs exceed the fixed price, their profit margin shrinks or they incur a loss. For the government, the risk is that the contractor might cut corners on quality or maintenance to protect their profit margin, especially in later years, potentially impacting long-term building performance or requiring future remedial work. Additionally, if the government's needs or building usage change significantly over 18 years, the contract's flexibility to adapt might be limited without costly change orders. Robust measurement and verification (M&V) protocols are crucial to mitigate these risks.

How effective are GSA's Energy Savings Performance Contracts in achieving stated energy reduction goals?

GSA's Energy Savings Performance Contracts (ESPCs) have generally been effective in achieving stated energy reduction goals, serving as a key mechanism for the agency to meet federal energy efficiency mandates. These contracts are designed with performance guarantees, meaning the contractor is only paid for the energy savings they deliver, as verified through rigorous measurement and verification (M&V) processes. GSA's extensive experience with ESPCs, often leveraging established programs like the one this contract falls under, contributes to their success. While specific savings percentages can vary based on building type, existing conditions, and the scope of retrofits, numerous GSA reports and independent analyses indicate that ESPCs consistently deliver significant energy and cost savings, often meeting or exceeding initial projections. The long-term nature of these contracts also supports sustained energy performance improvements.

What is the historical spending trend for energy conservation measures by the GSA?

The General Services Administration (GSA) has shown a consistent and increasing trend in spending on energy conservation measures over the past decade, driven by federal mandates such as the Energy Policy Act of 2005 and subsequent executive orders promoting sustainability and energy efficiency in federal buildings. GSA utilizes various contracting vehicles, including Energy Savings Performance Contracts (ESPCs) and Utility Energy Service Contracts (UESCs), to implement these measures. Annual spending figures can fluctuate based on program cycles, budget appropriations, and the availability of suitable projects. However, the overall trajectory indicates a sustained commitment to investing in energy efficiency upgrades across its vast portfolio of federal buildings. This $217 million award represents a significant single investment within this ongoing trend, reflecting the scale of GSA's efforts to modernize its facilities and reduce its environmental footprint.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Solicitation ID: 47PF0025F0227

Offers Received: 13

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 111 SPEEN ST STE 410, FRAMINGHAM, MA, 01701

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

Financial Breakdown

Contract Ceiling: $229,114,412

Exercised Options: $217,262,240

Current Obligation: $217,262,240

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DEEE0008027

IDV Type: IDC

Timeline