DOE awards $6.6B contract for Savannah River Site liquid waste management over 13 years
Contract Overview
Contract Amount: $6,626,030,703 ($6.6B)
Contractor: Savannah River Remediation LLC
Awarding Agency: Department of Energy
Start Date: 2009-03-30
End Date: 2022-02-26
Contract Duration: 4,716 days
Daily Burn Rate: $1.4M/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: COST PLUS AWARD FEE
Sector: Other
Official Description: NEW CONTRACT AWARD FOR MANAGEMENT OF THE LIQUID WASTE SYSTEM AT SRS
Place of Performance
Location: AIKEN, AIKEN County, SOUTH CAROLINA, 29802
Plain-Language Summary
Department of Energy obligated $6.63 billion to SAVANNAH RIVER REMEDIATION LLC for work described as: NEW CONTRACT AWARD FOR MANAGEMENT OF THE LIQUID WASTE SYSTEM AT SRS Key points: 1. Contract value represents significant long-term investment in hazardous waste treatment. 2. Full and open competition suggests a robust bidding process for this critical service. 3. Cost-plus award fee structure incentivizes performance while managing cost uncertainty. 4. Contract duration of nearly 13 years indicates a stable, long-term operational need. 5. The award to Savannah River Remediation LLC highlights a single entity responsible for a complex environmental task. 6. Focus on hazardous waste treatment and disposal points to significant environmental and safety considerations.
Value Assessment
Rating: good
The total award value of $6.6 billion over approximately 13 years suggests a substantial commitment to managing liquid waste at the Savannah River Site. Benchmarking this against similar large-scale environmental remediation contracts is challenging due to the unique nature of nuclear site waste. However, the cost-plus award fee structure implies that while costs are reimbursed, performance incentives are in place to drive efficiency and value. The contract's duration and scale indicate a significant, ongoing operational requirement.
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 bidders had the opportunity to compete for this significant service. The presence of two bidders, as suggested by the 'no' field, implies a competitive environment, which is generally favorable for price discovery and ensuring the government receives competitive offers. The specific details of the bidding process and the number of proposals received would provide further insight into the intensity of the competition.
Taxpayer Impact: Full and open competition typically leads to better pricing for taxpayers by encouraging multiple companies to offer their best terms. This process helps ensure that the selected contractor is both technically capable and cost-effective.
Public Impact
The primary beneficiaries are the Department of Energy and the public, through the safe and compliant management of hazardous liquid waste at the Savannah River Site. The contract delivers essential services for the treatment and disposal of hazardous waste, crucial for environmental protection and site cleanup. The geographic impact is concentrated at the Savannah River Site in South Carolina, a key federal facility. Workforce implications include the employment of numerous technical, operational, and administrative personnel required for complex waste management operations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long-term nature of hazardous waste management can present evolving technical challenges and potential cost overruns.
- Cost-plus award fee contracts require diligent oversight to ensure performance incentives are effectively managed and costs are controlled.
- The scale of the operation necessitates robust safety protocols and environmental monitoring to prevent incidents.
Positive Signals
- Awarded under full and open competition, suggesting a competitive process that should yield value.
- The contract structure includes award fees, incentivizing contractor performance and potentially leading to better outcomes.
- The long duration indicates a stable, ongoing need, allowing for specialized expertise development and long-term planning.
Sector Analysis
This contract falls within the environmental services sector, specifically focusing on hazardous waste treatment and disposal. The market for managing waste from federal facilities, particularly those with historical nuclear operations like the Savannah River Site, is specialized and often dominated by a few large, experienced contractors. The scale of this contract, exceeding $6 billion, places it among the largest in this niche, reflecting the complexity and volume of waste generated at the site.
Small Business Impact
The data indicates that small business participation was not a primary set-aside criterion for this contract (ss: false, sb: false). While the prime contractor, Savannah River Remediation LLC, is likely a large entity, there may be opportunities for small businesses to participate as subcontractors. The extent of small business subcontracting would need further investigation to assess its impact on the small business ecosystem.
Oversight & Accountability
Oversight for this contract is primarily the responsibility of the Department of Energy, which awarded and manages the contract. The cost-plus award fee structure necessitates close monitoring of performance metrics and cost expenditures. Transparency is generally maintained through federal contract databases and reporting requirements. Inspector General jurisdiction would likely apply to investigations of fraud, waste, or abuse related to the contract.
Related Government Programs
- Department of Energy Environmental Management
- Savannah River Site Operations
- Hazardous Waste Management Contracts
- Nuclear Site Remediation
- Federal Facility Cleanup
Risk Flags
- Long-term contract duration increases exposure to potential scope creep or unforeseen technical challenges.
- Cost-plus contract types require stringent oversight to prevent cost overruns.
- Management of hazardous and radioactive waste carries inherent safety and environmental risks.
Tags
department-of-energy, savannah-river-site, hazardous-waste-treatment, liquid-waste-management, definitive-contract, cost-plus-award-fee, full-and-open-competition, environmental-services, south-carolina, large-contract, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Energy awarded $6.63 billion to SAVANNAH RIVER REMEDIATION LLC. NEW CONTRACT AWARD FOR MANAGEMENT OF THE LIQUID WASTE SYSTEM AT SRS
Who is the contractor on this award?
The obligated recipient is SAVANNAH RIVER REMEDIATION LLC.
Which agency awarded this contract?
Awarding agency: Department of Energy (Department of Energy).
What is the total obligated amount?
The obligated amount is $6.63 billion.
What is the period of performance?
Start: 2009-03-30. End: 2022-02-26.
What is the historical spending trend for liquid waste management at the Savannah River Site prior to this contract?
Detailed historical spending data specifically for liquid waste management at the Savannah River Site prior to this contract award is not directly available in the provided data. However, the initiation of a large, long-term contract valued at $6.6 billion suggests a sustained and significant operational requirement for these services. Federal spending on environmental management and site cleanup, particularly at legacy nuclear facilities, has historically been substantial and spans decades. Analyzing past appropriations for the Department of Energy's Environmental Management program and specific site budgets would be necessary to establish a comprehensive spending trend. The sheer size of this award indicates that previous expenditures, whether through multiple smaller contracts or prior large-scale efforts, were also considerable, reflecting the ongoing challenge of managing complex waste streams.
How does the per-unit cost of waste treatment under this contract compare to industry benchmarks?
Determining a precise per-unit cost for waste treatment under this contract is complex due to the 'Cost Plus Award Fee' (CPAF) structure and the diverse nature of 'liquid waste' which can encompass various hazardous and radioactive components. The CPAF model means that actual costs are reimbursed plus a fee that is tied to performance, making a fixed per-unit cost difficult to establish and compare directly. Benchmarking would require detailed knowledge of the specific waste streams treated, the technologies employed, and the associated operational overhead. Without granular data on the volume and type of waste processed and the specific cost drivers, a direct comparison to industry benchmarks for hazardous waste treatment or disposal is not feasible from the provided summary data. Such analysis would typically involve comparing cost per ton, cost per gallon, or cost per cubic meter for similar waste types and treatment processes.
What are the key performance indicators (KPIs) used to determine the award fee for Savannah River Remediation LLC?
The provided data does not specify the key performance indicators (KPIs) used to determine the award fee for Savannah River Remediation LLC. However, in Cost Plus Award Fee (CPAF) contracts, KPIs are typically established in the contract's Performance Work Statement (PWS) and are designed to measure the contractor's success in meeting critical objectives. For a contract managing liquid waste at a site like SRS, these KPIs would likely include metrics related to environmental compliance (e.g., meeting discharge limits, regulatory adherence), operational efficiency (e.g., waste processing rates, system uptime), safety performance (e.g., incident rates, adherence to safety protocols), project milestones, and potentially cost control measures. The Department of Energy would monitor these KPIs and use them to assess the contractor's performance, influencing the amount of award fee granted.
What is the track record of Savannah River Remediation LLC in managing similar environmental contracts?
Savannah River Remediation LLC (SRR) was formed specifically to manage the liquid waste operations at the Savannah River Site. Its track record is therefore intrinsically linked to its performance on this very contract, which began in March 2009. SRR is a team led by AECOM, with Fluor and Honeywell as major partners. These parent companies have extensive experience in managing large, complex environmental, engineering, and construction projects for government and industrial clients worldwide. While SRR as a specific entity's 'track record' is tied to this SRS contract, the collective experience of its leadership and member companies in areas such as nuclear operations, waste management, and environmental remediation is substantial and forms the basis of their capability to undertake such a significant federal contract.
What are the potential risks associated with the 'Cost Plus Award Fee' contract type for this service?
The primary risk associated with a 'Cost Plus Award Fee' (CPAF) contract type, especially for a long-term, complex service like liquid waste management, is the potential for cost growth if not managed diligently. While the 'cost plus' aspect means the government reimburses the contractor's allowable costs, the 'award fee' component is intended to incentivize performance and control costs. However, if the government's oversight is insufficient or the performance metrics are not well-defined, there's a risk that costs could escalate beyond initial projections. The contractor may also focus on achieving award fee targets that might not align perfectly with the most critical long-term value for the government. Effective management requires robust government oversight, clear performance standards, and a well-structured fee determination process to mitigate these risks and ensure value for taxpayer money.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Waste Treatment and Disposal › Hazardous Waste Treatment and Disposal
Product/Service Code: OPERATION OF GOVT OWNED FACILITY › OPERATION OF SHIPS, SMALL CRAFTS, PONTOONS AND FLOATING DOCKS
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: PAE Government Services Inc.
Address: 106 NEWBERRY ST SW, AIKEN, SC, 29801
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $7,530,058,267
Exercised Options: $6,804,591,092
Current Obligation: $6,626,030,703
Actual Outlays: $908,371,484
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Timeline
Start Date: 2009-03-30
Current End Date: 2022-02-26
Potential End Date: 2022-02-26 00:00:00
Last Modified: 2025-12-01
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