DOE awards $170.5M for Stirling Radioisotope Power System integration, with Lockheed Martin as prime
Contract Overview
Contract Amount: $170,568,000 ($170.6M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Energy
Start Date: 2000-08-14
End Date: 2015-08-30
Contract Duration: 5,494 days
Daily Burn Rate: $31.0K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: SYSTEM INTEFRATION OF A STIRLING RADIOISOTOPE POWER SYSTEM (SRPS)
Place of Performance
Location: KING OF PRUSSIA, MONTGOMERY County, PENNSYLVANIA, 19406
Plain-Language Summary
Department of Energy obligated $170.6 million to LOCKHEED MARTIN CORP for work described as: SYSTEM INTEFRATION OF A STIRLING RADIOISOTOPE POWER SYSTEM (SRPS) Key points: 1. Contract value of $170.5 million for a complex system integration. 2. Full and open competition suggests a potentially competitive bidding process. 3. Cost-plus-fixed-fee contract type may lead to cost overruns if not managed carefully. 4. The contract duration of over 5400 days indicates a long-term, high-stakes project. 5. Focus on a niche but critical technology for space and potentially other applications. 6. Prime contractor Lockheed Martin has extensive experience in aerospace and defense.
Value Assessment
Rating: good
The contract value of $170.5 million for the integration of a Stirling Radioisotope Power System (SRPS) appears reasonable given the complexity and specialized nature of the technology. While specific benchmarks for SRPS integration are scarce due to its niche application, the cost-plus-fixed-fee structure allows for flexibility in development but necessitates robust oversight to control costs. Comparing this to other large-scale, long-duration system integration projects in aerospace, the pricing seems within a plausible range, assuming the fixed fee is appropriately set relative to the estimated costs.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of two bids suggests a degree of competition, though the exact number of potential bidders for such a specialized system is likely limited. This competitive approach is generally favorable for price discovery and ensuring the government receives the best value, as contractors are incentivized to offer competitive terms.
Taxpayer Impact: Full and open competition helps ensure taxpayer dollars are used efficiently by fostering a competitive environment that drives down costs and encourages innovation.
Public Impact
This contract directly supports the development and integration of advanced power systems crucial for deep space missions and potentially other government applications requiring reliable, long-term power sources. The primary beneficiaries are likely the Department of Energy's research and development initiatives, as well as any future space exploration or national security programs that will utilize the SRPS. The geographic impact is primarily centered around the contractor's facilities in Pennsylvania, where the integration work will take place. The contract supports a highly specialized workforce within the aerospace and nuclear technology sectors, requiring advanced engineering and technical expertise.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts can incentivize contractors to increase costs to maximize their fee, requiring stringent oversight.
- The long duration of the contract (over 5400 days) increases the risk of scope creep and potential cost escalations over time.
- The highly specialized nature of the technology may limit the pool of qualified contractors, potentially impacting future competition.
- Reliance on radioisotope power sources involves unique safety and regulatory considerations that must be meticulously managed.
Positive Signals
- Awarded under full and open competition, suggesting a robust and fair bidding process.
- The prime contractor, Lockheed Martin, has a strong track record in complex system integration and aerospace projects.
- The contract addresses a critical need for advanced power systems in strategic government programs.
- The fixed fee component, while requiring oversight, provides a degree of cost certainty compared to pure cost-plus contracts.
Sector Analysis
The Stirling Radioisotope Power System (SRPS) falls within the advanced manufacturing and specialized aerospace sectors. This contract represents a significant investment in a niche but critical technology that enables long-duration power generation in environments where solar or other conventional power sources are not feasible, such as deep space missions. The market for such specialized power systems is limited, primarily driven by government agencies like NASA and the Department of Energy. Comparable spending benchmarks are difficult to establish due to the unique nature of SRPS, but the contract value aligns with other large-scale, multi-year system development and integration efforts in the aerospace industry.
Small Business Impact
The contract data indicates that small business participation was not a primary set-aside consideration for this specific award, as the prime contractor is Lockheed Martin, a large corporation. There is no explicit mention of small business subcontracting goals in the provided data. The nature of this highly specialized technology integration may limit opportunities for broad small business subcontracting, though specific components or services could potentially be sourced from smaller, specialized firms.
Oversight & Accountability
Oversight for this contract would primarily fall under the Department of Energy's contracting and program management offices. Given the cost-plus-fixed-fee structure and the long duration, regular audits, performance reviews, and milestone tracking would be essential to ensure accountability and transparency. The contract's complexity and strategic importance suggest that it would likely be subject to high-level program reviews and potentially oversight from relevant Inspector General offices to monitor financial and performance aspects.
Related Government Programs
- NASA Space Exploration Programs
- Department of Energy Nuclear Technologies
- Advanced Power Systems Development
- Radioisotope Thermoelectric Generators (RTGs)
- Aerospace System Integration Contracts
Risk Flags
- Long contract duration increases risk of cost escalation and scope creep.
- Cost-plus-fixed-fee contract type requires diligent oversight to manage costs.
- Niche technology may limit competition and increase reliance on specific expertise.
- Safety and regulatory considerations for radioisotope power sources.
Tags
energy, department-of-energy, lockheed-martin-corp, definitive-contract, cost-plus-fixed-fee, full-and-open-competition, aerospace, research-and-development, power-systems, space-vehicles, pennsylvania, large-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $170.6 million to LOCKHEED MARTIN CORP. SYSTEM INTEFRATION OF A STIRLING RADIOISOTOPE POWER SYSTEM (SRPS)
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $170.6 million.
What is the period of performance?
Start: 2000-08-14. End: 2015-08-30.
What is the historical spending trend for Stirling Radioisotope Power Systems (SRPS) by the Department of Energy?
Historical spending data specifically for Stirling Radioisotope Power Systems (SRPS) by the Department of Energy is not readily available in public databases. SRPS technology is a specialized area, and its development and integration often occur within broader research and development programs or specific mission-focused contracts. While the Department of Energy has a long history with radioisotope power sources, including RTGs, detailed expenditure figures for SRPS development and integration are typically embedded within larger program budgets or classified as proprietary research. This $170.5 million contract appears to be a significant, dedicated investment in the SRPS technology, suggesting a potential ramp-up in its application or a critical phase of development.
How does the cost-plus-fixed-fee (CPFF) contract type impact the value for money in this SRPS integration project?
The Cost-Plus-Fixed-Fee (CPFF) contract type for this SRPS integration project presents a mixed bag for value for money. On one hand, it allows for flexibility and adaptation during the complex integration process, which is beneficial for novel or evolving technologies where exact costs are hard to predict. The fixed fee provides the contractor with a defined profit margin, incentivizing them to complete the work. However, CPFF contracts can also lead to higher overall costs for the government if the contractor's actual costs exceed initial estimates, as the government bears the risk of cost overruns while the contractor's fee remains fixed. Effective oversight, stringent cost controls, and clear performance metrics are crucial to ensure value for money under this contract type.
What are the primary risks associated with the long duration (5494 days) of this SRPS integration contract?
The extended duration of 5494 days (approximately 15 years) for this SRPS integration contract introduces several significant risks. Firstly, there is a heightened risk of scope creep, where project requirements may evolve or expand over such a long period, potentially leading to cost overruns and schedule delays. Secondly, technological obsolescence is a concern; advancements in power systems could emerge during the contract's life, potentially making the SRPS technology less competitive or requiring costly upgrades. Thirdly, contractor performance and key personnel stability can be challenging to maintain over such an extended timeframe. Finally, economic fluctuations and changes in government priorities could impact funding and project continuation, necessitating robust risk management and contingency planning throughout the contract's lifecycle.
What is Lockheed Martin's track record with similar large-scale, specialized system integration projects?
Lockheed Martin Corporation has an extensive and well-established track record in managing and executing large-scale, complex system integration projects, particularly within the aerospace, defense, and space sectors. They have been prime contractors for numerous high-profile government programs, including satellite development, missile systems, and advanced aircraft. Their experience encompasses managing intricate supply chains, integrating diverse technological components, ensuring stringent quality control, and adhering to demanding performance specifications. While specific details on SRPS integration might be proprietary, Lockheed Martin's broad expertise in handling technically challenging, long-duration, and high-value contracts suggests a strong capability to manage the complexities of this particular project.
How does the 'Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing' NAICS code relate to the Stirling Radioisotope Power System (SRPS)?
The NAICS code 336415, 'Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing,' is relevant to the Stirling Radioisotope Power System (SRPS) integration contract because SRPS are advanced power sources designed for applications in space vehicles, including those used for propulsion or long-duration power in space missions. While SRPS are primarily power generation systems rather than propulsion units themselves, their development and integration are closely tied to the aerospace industry's needs for reliable energy in space. The manufacturing and integration of such specialized components fall under the broader umbrella of aerospace propulsion and power systems, making this NAICS code an appropriate classification for the contractor's activities.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Propulsion Unit and Propulsion Unit Parts Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › Space R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: COST PLUS FIXED FEE (U)
Contractor Details
Address: 230 MALL BLVD, KING OF PRUSSIA, PA, 19406
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $227,204,548
Exercised Options: $226,766,695
Current Obligation: $170,568,000
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Timeline
Start Date: 2000-08-14
Current End Date: 2015-08-30
Potential End Date: 2016-02-26 00:00:00
Last Modified: 2020-09-29
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