GSA's $3.7M UESC Contract with PG&E Faces Scrutiny for Lack of Competition and Long Duration

Contract Overview

Contract Amount: $3,730,273 ($3.7M)

Contractor: Pacific GAS and Electric Company

Awarding Agency: General Services Administration

Start Date: 2017-05-19

End Date: 2036-12-01

Contract Duration: 7,136 days

Daily Burn Rate: $523/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: IGF::OT::IGF UESC SANSOME STREET

Place of Performance

Location: SAN FRANCISCO, SAN FRANCISCO County, CALIFORNIA, 94111

State: California Government Spending

Plain-Language Summary

General Services Administration obligated $3.7 million to PACIFIC GAS AND ELECTRIC COMPANY for work described as: IGF::OT::IGF UESC SANSOME STREET Key points: 1. The contract's value of $3.7 million is moderate, but the extended duration raises questions about long-term cost-effectiveness. 2. Lack of competition is a significant concern, potentially leading to inflated prices and reduced value for taxpayers. 3. The long contract duration (over 18 years) presents a risk of obsolescence and missed opportunities for better pricing. 4. This contract falls within the Energy sector, specifically focusing on electric power distribution.

Value Assessment

Rating: questionable

The contract's pricing is not explicitly detailed, but the lack of competition and long duration suggest potential overpayment. Without benchmark data, it's difficult to assess true value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was awarded as a delivery order under a UESC (Utility Energy Service Contract) which often have limited competition. This method may not have explored all available market options, potentially impacting price discovery.

Taxpayer Impact: The extended duration and limited competition raise concerns about whether taxpayers are receiving the best possible price for these essential energy services.

Public Impact

Taxpayers may be overpaying for electricity distribution services due to the absence of competitive bidding. The long-term commitment locks the government into a single provider for nearly two decades, limiting flexibility. Public funds are being allocated to a contract that could potentially be more cost-effective if competitively sourced.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition
Long contract duration
Potential for price escalation

Positive Signals

Provides essential utility services
Long-term service commitment

Sector Analysis

This contract is within the Energy sector, specifically electric power distribution. Utility Energy Service Contracts (UESCs) are common for government facilities, but their competitive nature can vary significantly.

Small Business Impact

There is no indication that small businesses were involved in this contract award. The focus appears to be on a large utility provider.

Oversight & Accountability

The long duration and limited competition warrant closer oversight to ensure continued value and accountability for taxpayer funds.

Related Government Programs

Electric Power Distribution
General Services Administration Contracting
Public Buildings Service Programs

Risk Flags

Lack of competitive bidding
Extended contract duration (over 18 years)
Potential for non-competitive pricing
Limited transparency in price determination

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $3.7 million to PACIFIC GAS AND ELECTRIC COMPANY. IGF::OT::IGF UESC SANSOME STREET

Who is the contractor on this award?

The obligated recipient is PACIFIC GAS AND ELECTRIC COMPANY.

Which agency awarded this contract?

Awarding agency: General Services Administration (Public Buildings Service).

What is the total obligated amount?

The obligated amount is $3.7 million.

What is the period of performance?

Start: 2017-05-19. End: 2036-12-01.

What was the justification for limiting competition on this UESC contract, and how was the pricing determined to be fair and reasonable?

The justification for limited competition on UESC contracts often stems from the nature of utility services, where a single provider may be the sole source for infrastructure within a specific area. However, agencies must still demonstrate that pricing was determined through a fair and reasonable process, often involving cost analysis and comparison to market rates, even if formal bidding is not conducted.

What are the risks associated with a contract duration of over 18 years for electric power distribution services?

A contract duration of over 18 years for electric power distribution poses risks such as technological obsolescence, changes in market pricing that could make the current rate unfavorable, and potential shifts in government energy needs or policy. It also limits the agency's ability to renegotiate terms or adopt newer, potentially more efficient technologies or service providers.

How does the lack of competition in this contract impact the overall effectiveness and value for taxpayer money?

The lack of competition significantly impacts effectiveness and value by removing the primary incentive for cost reduction and service improvement. Without competitive pressure, the awarded contractor may not feel compelled to offer the lowest possible price or the most innovative solutions, potentially leading to higher costs for taxpayers and less optimal service delivery over the contract's long lifespan.

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: 300 LAKESIDE DR, OAKLAND, CA, 94612

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $11,564,801

Exercised Options: $3,730,273

Current Obligation: $3,730,273

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $3,946,453

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P14BSD1137

IDV Type: IDC

Timeline