NASA Awards $2.42 Billion Electric Power Distribution Contract to El Paso Electric Company in New Mexico
Contract Overview
Contract Amount: $2,421,000 ($2.4M)
Contractor: EL Paso Electric Company
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2023-09-01
End Date: 2033-08-31
Contract Duration: 3,652 days
Daily Burn Rate: $663/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: ELECTRIC UTILITIES
Place of Performance
Location: LAS CRUCES, DONA ANA County, NEW MEXICO, 88012
Plain-Language Summary
National Aeronautics and Space Administration obligated $2.4 million to EL PASO ELECTRIC COMPANY for work described as: ELECTRIC UTILITIES Key points: 1. Significant long-term contract value of $2.42 billion over 10 years. 2. Sole-source award indicates limited competition, potentially impacting price discovery. 3. High contract value presents a substantial taxpayer investment. 4. Focus on electric power distribution for NASA operations in New Mexico.
Value Assessment
Rating: fair
The contract is a delivery order under an existing agreement. Specific pricing details and benchmarks are not available in the provided data, making a direct comparison difficult. The firm fixed price structure aims to control costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, meaning there was no open competition. This limits the government's ability to leverage market forces to achieve the best possible price.
Taxpayer Impact: The substantial value of this contract represents a significant allocation of taxpayer funds for essential utility services over a decade.
Public Impact
Ensures reliable electricity for critical NASA facilities in New Mexico. Supports long-term operational stability for space exploration and research. Potential for economic impact within the New Mexico region through utility services.
Waste & Efficiency Indicators
Waste Risk Score: 60 / 10
Warning Flags
- Lack of competition may lead to suboptimal pricing.
- Long contract duration (10 years) could expose NASA to market fluctuations.
- Sole-source nature requires strong justification for fairness.
Positive Signals
- Provides essential, long-term utility services for NASA.
- Firm fixed price contract offers cost predictability.
- Supports critical infrastructure in New Mexico.
Sector Analysis
The electric utilities sector is crucial for powering government operations. This contract represents a significant portion of spending within this sector for NASA, ensuring consistent energy supply for its New Mexico installations.
Small Business Impact
The provided data does not indicate any specific provisions or participation by small businesses in this contract. Further investigation would be needed to determine small business involvement.
Oversight & Accountability
Given the sole-source nature and long duration, robust oversight will be necessary to ensure fair pricing and performance throughout the contract term. NASA's contracting office is responsible for monitoring this delivery order.
Related Government Programs
- Electric Power Distribution
- National Aeronautics and Space Administration Contracting
- National Aeronautics and Space Administration Programs
Risk Flags
- Sole-source award
- Long contract duration
- Lack of competitive pricing data
- Potential for price escalation over 10 years
Tags
electric-power-distribution, national-aeronautics-and-space-administr, nm, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $2.4 million to EL PASO ELECTRIC COMPANY. ELECTRIC UTILITIES
Who is the contractor on this award?
The obligated recipient is EL PASO ELECTRIC COMPANY.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $2.4 million.
What is the period of performance?
Start: 2023-09-01. End: 2033-08-31.
What is the justification for the sole-source award, and how was the price determined to be fair and reasonable without competition?
The justification for a sole-source award typically involves unique capabilities or circumstances where only one source can meet the requirement. For this contract, NASA would need to demonstrate why El Paso Electric Company is the only viable option. The determination of a fair and reasonable price without competition often relies on historical pricing, independent government cost estimates, or certified cost or pricing data from the contractor.
What are the potential risks associated with a 10-year firm fixed-price contract for electric utilities in a single state?
A 10-year firm fixed-price contract for utilities carries risks such as potential underestimation of future market price increases, leading to the government paying above market rates over time. Conversely, if market prices fall significantly, the government is locked into the higher price. Regulatory changes or unforeseen infrastructure costs could also impact the contractor's ability to maintain service at the fixed price without adjustments.
How does this contract ensure the effectiveness of NASA's operations in New Mexico, and what are the contingency plans if service is disrupted?
The effectiveness is ensured by providing a stable and reliable source of electricity, which is fundamental for NASA's research, testing, and operational facilities. Contingency plans would likely be detailed within the contract's service level agreements and could include backup power provisions, penalties for service disruptions, and defined communication protocols for emergencies. NASA would also have internal continuity of operations plans.
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
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 100 N STANTON ST, EL PASO, TX, 79901
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $17,000,000
Exercised Options: $17,000,000
Current Obligation: $2,421,000
Actual Outlays: $2,166,904
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 47PA0420D0013
IDV Type: IDC
Timeline
Start Date: 2023-09-01
Current End Date: 2033-08-31
Potential End Date: 2033-08-31 00:00:00
Last Modified: 2026-01-08
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