DOE's $1.7B Hanford cleanup task order awarded to Central Plateau Cleanup Company, focusing on end states and base operations

Contract Overview

Contract Amount: $1,701,793,005 ($1.7B)

Contractor: Central Plateau Cleanup Company, LLC

Awarding Agency: Department of Energy

Start Date: 2021-08-16

End Date: 2024-09-30

Contract Duration: 1,141 days

Daily Burn Rate: $1.5M/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST PLUS INCENTIVE FEE

Sector: Other

Official Description: HANFORD CENTRAL PLATEAU CLEANUP CONTRACT - TASK ORDER 4 - END STATES & BASE OPS. THIS TASK ORDER IS ISSUED AS AN UNDEFINITIZED TASK ORDER PURSUANT TO CLAUSE H.49, TASK ORDERING PROCEDURE. NOTICE-TO-PROCEED SHALL BE EFFECTIVE ON OCTOBER 1, 2021.

Place of Performance

Location: RICHLAND, BENTON County, WASHINGTON, 99352

State: Washington Government Spending

Plain-Language Summary

Department of Energy obligated $1.70 billion to CENTRAL PLATEAU CLEANUP COMPANY, LLC for work described as: HANFORD CENTRAL PLATEAU CLEANUP CONTRACT - TASK ORDER 4 - END STATES & BASE OPS. THIS TASK ORDER IS ISSUED AS AN UNDEFINITIZED TASK ORDER PURSUANT TO CLAUSE H.49, TASK ORDERING PROCEDURE. NOTICE-TO-PROCEED SHALL BE EFFECTIVE ON OCTOBER 1, 2021. Key points: 1. This task order represents a significant investment in the long-term environmental remediation of the Hanford site. 2. The contract type, Cost Plus Incentive Fee (CPIF), aims to incentivize cost savings and performance efficiencies. 3. Awarded under full and open competition, it suggests a robust market for specialized environmental remediation services. 4. The duration of over three years indicates a substantial and ongoing commitment to cleanup activities. 5. The geographic focus on Washington state highlights the localized impact of this federal spending. 6. The absence of small business set-aside flags suggests the primary contractor is a large entity or the scope requires specialized capabilities.

Value Assessment

Rating: good

The contract value of approximately $1.7 billion over three years for environmental remediation services at a complex site like Hanford appears reasonable, especially considering the CPIF structure which allows for shared savings. Benchmarking against similar large-scale environmental cleanup contracts is challenging due to the unique nature of the Hanford site, but the pricing mechanism suggests an effort to achieve value for money by aligning contractor incentives with government objectives. The contract's focus on specific end states and base operations indicates a defined scope, which aids in assessing value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple qualified bidders had the opportunity to compete for this significant task order. This competitive process is expected to foster price discovery and ensure that the Department of Energy receives competitive pricing for the complex remediation services required. The number of bidders is not specified, but the 'full and open' designation implies a substantial level of market engagement.

Taxpayer Impact: A full and open competition generally benefits taxpayers by driving down costs through market forces and ensuring that the most capable and cost-effective provider is selected, maximizing the efficient use of public funds for critical environmental cleanup.

Public Impact

The primary beneficiaries are the citizens of Washington state and the nation, through the cleanup of a major environmental hazard. The services delivered include critical environmental remediation, waste management, and operational support at the Hanford site. The geographic impact is concentrated in the Hanford area of Washington state, with potential ripple effects on the local economy and workforce. Workforce implications include the potential for job creation in specialized fields such as environmental engineering, hazardous waste handling, and project management.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns inherent in large, complex remediation projects, even with CPIF.
Long-term environmental risks associated with nuclear material handling and disposal require continuous vigilance.
Dependence on a single large contractor for a critical, long-duration mission could pose continuity risks if not managed proactively.

Positive Signals

The CPIF contract structure incentivizes cost efficiency and performance.
Awarded under full and open competition, suggesting a competitive market and potentially better value.
Clear focus on specific 'end states' and 'base operations' provides defined objectives for performance.
The Department of Energy's oversight is crucial for managing the complexities of this large-scale cleanup.

Sector Analysis

This contract falls within the Environmental Remediation and Waste Management sector, a critical area for government spending, particularly concerning legacy nuclear sites. The market for such specialized services is relatively concentrated, with a few large firms possessing the expertise and capacity to handle projects of this magnitude. The Hanford site is one of the most complex and expensive environmental cleanup projects in the world, making this contract a significant component of federal spending in this sector. Comparable spending benchmarks are difficult to establish due to the unique nature of nuclear site remediation, but the scale of this task order is substantial.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the primary contractor, Central Plateau Cleanup Company, LLC, is likely a large business, or the scope of work requires specialized capabilities typically found in larger firms. While there's no direct indication of subcontracting plans for small businesses within this specific task order data, large federal contracts often include subcontracting goals to engage small businesses. The impact on the small business ecosystem would depend on the extent to which Central Plateau Cleanup Company, LLC, fulfills any subcontracting requirements.

Oversight & Accountability

Oversight for this contract is primarily the responsibility of the Department of Energy (DOE). The CPIF contract type includes performance incentives that require monitoring and evaluation to ensure cost-effectiveness and successful achievement of objectives. Transparency is facilitated through federal contract databases and public reporting requirements. The Inspector General's office within the DOE would have jurisdiction to investigate any potential fraud, waste, or abuse related to this task order, ensuring accountability.

Related Government Programs

Hanford Site Cleanup
Department of Energy Environmental Management
Nuclear Waste Disposal
Environmental Remediation Services
Large Federal Contracts
Cost-Plus Incentive Fee Contracts

Risk Flags

Potential for cost overruns in complex environmental remediation.
Long-term nature of cleanup requires sustained funding and oversight.
Safety risks associated with handling hazardous and radioactive materials.
Dependence on contractor performance for critical environmental objectives.

Frequently Asked Questions

What is this federal contract paying for?

Department of Energy awarded $1.70 billion to CENTRAL PLATEAU CLEANUP COMPANY, LLC. HANFORD CENTRAL PLATEAU CLEANUP CONTRACT - TASK ORDER 4 - END STATES & BASE OPS. THIS TASK ORDER IS ISSUED AS AN UNDEFINITIZED TASK ORDER PURSUANT TO CLAUSE H.49, TASK ORDERING PROCEDURE. NOTICE-TO-PROCEED SHALL BE EFFECTIVE ON OCTOBER 1, 2021.

Who is the contractor on this award?

The obligated recipient is CENTRAL PLATEAU CLEANUP COMPANY, LLC.

Which agency awarded this contract?

Awarding agency: Department of Energy (Department of Energy).

What is the total obligated amount?

The obligated amount is $1.70 billion.

What is the period of performance?

Start: 2021-08-16. End: 2024-09-30.

What is the track record of Central Plateau Cleanup Company, LLC in managing large-scale environmental remediation projects?

Central Plateau Cleanup Company, LLC (CPCC) is a relatively new entity formed specifically to manage the Hanford Central Plateau Cleanup Contract. It is a limited liability company formed by a joint venture of Fluor Federal Services, Inc., Atkins Nuclear Secured, Inc., and CH2M Hill Constructors, Inc. These parent companies have extensive experience in managing complex environmental, nuclear, and infrastructure projects for government agencies, including the Department of Energy and the Department of Defense. While CPCC as a distinct entity is new to this specific contract, its member companies bring decades of collective experience and a proven history of performance in similar high-risk, large-scale remediation and operational environments. Their track record suggests a strong foundation for managing the technical and logistical challenges associated with the Hanford site.

How does the pricing structure (Cost Plus Incentive Fee) compare to other large federal environmental remediation contracts?

The Cost Plus Incentive Fee (CPIF) structure is a common and often preferred contract type for large, complex federal projects where the final costs are difficult to estimate precisely upfront, such as environmental remediation. In a CPIF contract, the contractor is reimbursed for allowable costs plus a fee that is adjusted based on performance against pre-determined targets (e.g., cost, schedule, technical performance). This differs from fixed-price contracts, which offer more cost certainty but can be risky for the contractor on complex projects, or Cost Plus Fixed Fee (CPFF), where the fee is fixed regardless of performance. Compared to other large federal environmental remediation contracts, CPIF is frequently utilized because it balances the government's need for cost control with the contractor's need for flexibility and incentive to perform efficiently. It aims to achieve better value by sharing the risks and rewards of cost management and performance.

What are the primary risks associated with this specific task order, and how are they being mitigated?

The primary risks associated with this task order, 'HANFORD CENTRAL PLATEAU CLEANUP CONTRACT - TASK ORDER 4 - END STATES & BASE OPS,' are inherent in the nature of nuclear site cleanup. These include potential cost overruns due to unforeseen site conditions or technical challenges, schedule delays, and safety incidents involving hazardous materials. Environmental risks, such as the containment and disposal of radioactive and chemical waste, are also significant. Mitigation strategies are embedded within the contract structure and management approach. The CPIF contract type incentivizes cost control and efficient performance. The Department of Energy's robust oversight, including regular reviews, performance monitoring, and adherence to strict safety protocols, is critical. Furthermore, the contractor's reliance on experienced personnel and established safety management systems from its parent companies helps address operational risks.

What is the historical spending pattern for the Hanford Central Plateau Cleanup Contract, and how does this task order fit within it?

The Hanford Central Plateau Cleanup Contract is a multi-billion dollar, long-term initiative managed by the Department of Energy to address legacy contamination at the Hanford site. Historical spending on this contract has been substantial, reflecting the immense scale and complexity of the cleanup mission, which spans decades. This specific task order, valued at approximately $1.7 billion, represents a significant portion of the overall contract's funding, focusing on critical 'end states' and 'base operations.' It signifies a continued, substantial investment in achieving specific cleanup milestones. Understanding historical spending patterns is crucial for assessing the efficiency and progress of the overall cleanup program and for forecasting future budgetary needs. This task order's value aligns with the high-cost nature of environmental remediation at such a large and contaminated site.

How does the 'full and open competition' award mechanism impact the overall value and efficiency of this contract?

Awarding this task order under 'full and open competition' is a key mechanism designed to maximize value and efficiency for taxpayers. This process ensures that a wide range of qualified contractors can submit proposals, fostering a competitive environment. Competition typically drives down prices as contractors vie for the award, and it encourages innovation in technical approaches and project management. For the government, it increases the likelihood of selecting the most capable and cost-effective provider. The 'full and open' designation suggests that the Department of Energy did not impose significant restrictions on potential bidders, thereby broadening the pool of competition. This competitive pressure, combined with the CPIF incentive structure, is intended to yield the best possible outcome in terms of both cost and performance for this critical environmental cleanup mission.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Remediation and Other Waste Management Services › Remediation Services

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR BUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 89303318REM000008

Pricing Type: COST PLUS INCENTIVE FEE (V)

Evaluated Preference: NONE

Contractor Details

Parent Company: Pae-Parsons Global Logistics Services, LLC

Address: 106 NEWBERRY ST SW, AIKEN, SC, 29801

Business Categories: Category Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $1,730,078,902

Exercised Options: $1,730,078,902

Current Obligation: $1,701,793,005

Actual Outlays: $1,626,635,563

Subaward Activity

Number of Subawards: 141

Total Subaward Amount: $45,146,574

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 89303320DEM000030

IDV Type: IDC

Timeline