DOE's $26.3B Savannah River Site Contract Awarded to Savannah River Nuclear Solutions LLC
Contract Overview
Contract Amount: $26,346,419,033 ($26.3B)
Contractor: Savannah River Nuclear Solutions LLC
Awarding Agency: Department of Energy
Start Date: 2008-01-10
End Date: 2026-09-30
Contract Duration: 6,838 days
Daily Burn Rate: $3.9M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: MANAGEMENT AND OPERATING CONTRACT FOR THE SAVANNAH RIVER SITE.
Place of Performance
Location: AIKEN, AIKEN County, SOUTH CAROLINA, 29803
Plain-Language Summary
Department of Energy obligated $26.35 billion to SAVANNAH RIVER NUCLEAR SOLUTIONS LLC for work described as: MANAGEMENT AND OPERATING CONTRACT FOR THE SAVANNAH RIVER SITE. Key points: 1. The contract value is substantial at $26.3 billion, indicating a significant long-term commitment. 2. The award was made through full and open competition, suggesting a robust price discovery process. 3. The contract type is Cost Plus Award Fee, which can incentivize performance but may also lead to cost overruns if not managed carefully. 4. The sector is Facilities Support Services, crucial for national security and environmental management at the Savannah River Site.
Value Assessment
Rating: good
The Cost Plus Award Fee structure allows for performance incentives. Benchmarking against similar large-scale, complex facility management contracts is difficult due to the unique nature of the Savannah River Site's operations.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, which typically fosters competitive pricing. The Cost Plus Award Fee structure, however, means the final price is influenced by performance metrics and potential award fees.
Taxpayer Impact: The competitive award process is intended to secure the best value for taxpayers. However, the Cost Plus Award Fee nature requires careful oversight to ensure costs remain reasonable and performance targets are met.
Public Impact
Ensures continued operation and management of a critical national security and environmental cleanup site. Supports jobs and economic activity in the South Carolina region. Maintains infrastructure for nuclear materials management and research.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Award Fee contracts can lead to higher costs if performance incentives are not well-defined or if oversight is insufficient.
- The long duration of the contract (through 2026) means potential for cost escalation over time.
- Lack of small business participation noted.
Positive Signals
- Awarded through full and open competition, indicating a potentially competitive pricing process.
- Contract aims to ensure continuity of critical national security operations.
- Significant investment in a key federal facility.
Sector Analysis
This contract falls under Facilities Support Services, a broad category encompassing the management and operation of complex government facilities. Spending in this sector is often driven by national security, research, and environmental mandates, making long-term contracts common.
Small Business Impact
The data indicates that small business participation was not a factor in this specific contract award (ss: false, sb: false). This suggests the prime contractor is responsible for managing any subcontracting, and there may be limited direct opportunities for small businesses at the prime contract level.
Oversight & Accountability
The Department of Energy is the contracting agency, responsible for oversight. The Cost Plus Award Fee structure necessitates robust performance monitoring and financial auditing to ensure accountability and prevent cost overruns.
Related Government Programs
- Facilities Support Services
- Department of Energy Contracting
- Department of Energy Programs
Risk Flags
- Cost Plus Award Fee structure carries inherent risk of cost overruns.
- Long contract duration may lead to cost escalation.
- Lack of explicit small business participation noted.
- Complexity of the Savannah River Site operations presents unique management challenges.
Tags
facilities-support-services, department-of-energy, sc, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $26.35 billion to SAVANNAH RIVER NUCLEAR SOLUTIONS LLC. MANAGEMENT AND OPERATING CONTRACT FOR THE SAVANNAH RIVER SITE.
Who is the contractor on this award?
The obligated recipient is SAVANNAH RIVER NUCLEAR SOLUTIONS LLC.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $26.35 billion.
What is the period of performance?
Start: 2008-01-10. End: 2026-09-30.
What is the projected cost efficiency of this Cost Plus Award Fee contract compared to alternative contract types for managing such a complex site?
Cost Plus Award Fee contracts aim to balance cost control with performance incentives. While they can drive efficiency through award fees tied to specific metrics, they also carry a risk of higher overall costs if not meticulously managed. Benchmarking against fixed-price or other cost-reimbursement types is challenging due to the unique, high-risk nature of the Savannah River Site's operations, but requires rigorous DOE oversight to ensure value.
What are the primary risks associated with the long-term nature and Cost Plus Award Fee structure of this contract?
The primary risks include potential cost escalation over the contract's extended duration (through 2026) and the possibility of contractor behavior prioritizing award fee achievement over strict cost containment. Inadequate performance metrics or insufficient government oversight could lead to inefficiencies and higher-than-necessary expenditures for taxpayers.
How effectively does this contract ensure the continuity of critical national security and environmental management functions at the Savannah River Site?
The contract's objective is precisely to ensure continuity. By awarding a large, long-term contract to a single entity, the Department of Energy aims for stable management of complex operations. The success hinges on the contractor's capabilities and the effectiveness of the award fee structure in incentivizing high performance in these critical areas.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Facilities Support Services › Facilities Support Services
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATE GOVT OWNED BUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 2
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Fluor Corporation
Address: 6150 WOODSIDE EXECUTIVE CT, AIKEN, SC, 29803
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $37,975,006,319
Exercised Options: $37,975,006,319
Current Obligation: $26,346,419,033
Actual Outlays: $10,201,083,208
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Timeline
Start Date: 2008-01-10
Current End Date: 2026-09-30
Potential End Date: 2026-09-30 00:00:00
Last Modified: 2026-03-31
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