Honeywell Building Solutions awarded $17.8M for ESPC services at Naval Station Newport, Rhode Island

Contract Overview

Contract Amount: $17,880,615 ($17.9M)

Contractor: Honeywell Building Solutions SES Corp

Awarding Agency: Department of Defense

Start Date: 2008-07-10

End Date: 2027-10-31

Contract Duration: 7,052 days

Daily Burn Rate: $2.5K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 21

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ESPC SERVICES AT NAVAL STATION NEWPORT

Place of Performance

Location: ADAMSVILLE, NEWPORT County, RHODE ISLAND, 02801

State: Rhode Island Government Spending

Plain-Language Summary

Department of Defense obligated $17.9 million to HONEYWELL BUILDING SOLUTIONS SES CORP for work described as: ESPC SERVICES AT NAVAL STATION NEWPORT Key points: 1. Contract value represents a significant investment in energy efficiency and facility upgrades. 2. The contract was awarded under full and open competition, suggesting a competitive bidding process. 3. The long duration of the contract (over 18 years) indicates a long-term commitment to performance-based outcomes. 4. The fixed-price contract type shifts performance risk to the contractor. 5. The project is located in Rhode Island, potentially impacting the local economy and workforce. 6. The scope of work likely involves energy conservation measures and facility modernization.

Value Assessment

Rating: good

The contract value of $17.8 million for Energy Savings Performance Contract (ESPC) services appears reasonable given the extensive scope and long duration. ESPCs are designed to be cost-neutral or cost-saving, with savings generated from energy efficiency measures intended to cover the contract costs over time. Benchmarking against similar large-scale ESPC projects for federal facilities would provide a more precise value assessment, but the scale suggests a comprehensive upgrade program. The fixed-price nature of the contract also implies that the contractor has committed to delivering the specified outcomes within the awarded price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 21 bids suggests a robust competitive environment for this ESPC project. A high number of bidders generally leads to better price discovery and potentially more favorable terms for the government, as contractors vie to win the award. This level of competition is a positive indicator for achieving value for taxpayer money.

Taxpayer Impact: The extensive competition for this contract likely resulted in a more competitive price and a wider range of innovative solutions being offered, ultimately benefiting taxpayers through cost savings and improved energy performance.

Public Impact

Naval Station Newport benefits from modernized infrastructure and reduced energy operating costs. The project aims to improve energy efficiency and sustainability at a key military installation. The contract supports the Department of the Navy's broader energy resilience and conservation goals. Potential for local job creation in Rhode Island during the implementation and maintenance phases. Improved facility conditions can enhance the operational readiness and quality of life for service members and personnel.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (over 18 years) requires sustained performance monitoring to ensure ongoing value.
Reliance on energy savings to offset costs necessitates accurate baseline measurements and ongoing verification.
Potential for scope creep or unforeseen technical challenges in large-scale facility upgrades.
Ensuring the chosen energy conservation measures are the most cost-effective and technologically appropriate.
Contractor's ability to maintain performance and adapt to evolving energy technologies over the contract term.

Positive Signals

Awarded under full and open competition with 21 bids, indicating strong market interest and potential for competitive pricing.
Fixed-price contract type shifts performance risk to the contractor.
The project aligns with federal mandates for energy efficiency and sustainability.
The contractor, Honeywell Building Solutions, is a recognized leader in building automation and energy services.
The contract is structured as a delivery order under a larger IDIQ or similar vehicle, suggesting pre-qualification of the contractor.
The project is located in Rhode Island, potentially leveraging local expertise and contributing to the regional economy.

Sector Analysis

Energy Savings Performance Contracts (ESSPs) are a key mechanism for federal agencies to improve energy efficiency and reduce operating costs without upfront capital investment. These contracts leverage private sector expertise and financing to implement energy conservation measures (ECMs). The market for ESPCs is substantial, driven by federal mandates and the desire for operational cost savings. This contract fits within the broader energy services sector, specifically focusing on government facilities. Comparable spending benchmarks for ESPCs vary widely based on facility size, scope of work, and geographic location, but large naval installations often represent significant investments.

Small Business Impact

The data indicates that small business participation was not a primary focus for this specific contract, as the 'sb' (small business) flag is false. There is no explicit mention of small business set-asides or subcontracting requirements in the provided data. Therefore, the direct impact on the small business ecosystem for this particular award appears limited, although the prime contractor may engage small businesses for specific services or supplies as part of the project execution.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the agency's technical point of contact within the Department of the Navy. Performance monitoring, verification of energy savings, and financial accountability are key oversight functions. Given the long duration, regular reviews and audits are expected. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract. Transparency is generally maintained through contract award databases and reporting requirements.

Related Government Programs

Energy Savings Performance Contracts (ESPCs)
Department of Defense Facility Modernization
Naval Facilities Engineering Command (NAVFAC) Contracts
Federal Energy Management Program (FEMP)
Energy Conservation Measures (ECMs)
Base Realignment and Closure (BRAC) related projects

Risk Flags

Long-term contract performance risk
Accuracy of energy savings projections
Technological obsolescence of energy efficiency measures
Potential for cost overruns if scope changes
Dependence on fluctuating energy market prices

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $17.9 million to HONEYWELL BUILDING SOLUTIONS SES CORP. ESPC SERVICES AT NAVAL STATION NEWPORT

Who is the contractor on this award?

The obligated recipient is HONEYWELL BUILDING SOLUTIONS SES CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $17.9 million.

What is the period of performance?

Start: 2008-07-10. End: 2027-10-31.

What specific energy conservation measures (ECMs) are included in this contract, and what are their projected savings?

The provided data does not detail the specific energy conservation measures (ECMs) included in this ESPC. Typically, ESPCs involve a range of upgrades such as lighting retrofits, HVAC system modernization, building envelope improvements, renewable energy installations, and water conservation measures. The projected savings are calculated based on the implementation of these ECMs and are crucial for determining the contract's financial viability. The Department of the Navy and Honeywell Building Solutions would have detailed this in the contract's technical exhibits and savings calculation methodologies. These savings are essential for the contract to be cost-neutral or cost-saving over its lifespan, as the energy cost reductions are used to repay the investment.

How does the $17.8 million contract value compare to other ESPC projects at similar federal facilities?

The $17.8 million contract value for ESPC services at Naval Station Newport is substantial, reflecting the scale of a major naval installation. Comparing this value requires context regarding the facility's size, age, existing infrastructure, and the scope of energy conservation measures implemented. Large ESPCs for federal facilities can range from a few million to tens or even hundreds of millions of dollars. For instance, similar ESPCs at other large military bases or federal agency campuses often involve comprehensive overhauls of building systems, energy generation, and water management. Without specific details on the ECMs and the facility's baseline energy consumption, a direct comparison is difficult, but the awarded amount suggests a significant, multi-faceted energy efficiency and infrastructure upgrade project.

What is Honeywell Building Solutions' track record with federal ESPC contracts, particularly with the Department of Defense?

Honeywell Building Solutions (HBS) is a major player in the energy services sector and has a significant track record of executing ESPC contracts for federal agencies, including the Department of Defense. They are known for providing a wide range of building automation, energy management, and facility solutions. HBS has been involved in numerous large-scale projects aimed at improving energy efficiency, reducing operational costs, and enhancing facility performance across various government installations. Their experience typically includes managing complex projects, securing financing, implementing diverse ECMs, and ensuring guaranteed energy savings. Past performance evaluations and contract databases would provide more specific details on their success rates, project completions, and client satisfaction with DoD ESPC awards.

What are the primary risks associated with a long-term contract like this (over 18 years), and how are they mitigated?

The primary risks associated with a long-term ESPC contract include technological obsolescence, changes in energy prices or regulations, contractor performance degradation, and the accuracy of energy savings projections over an extended period. Technological obsolescence is mitigated by selecting adaptable technologies and potentially including provisions for upgrades. Fluctuations in energy prices and regulations are managed through contract clauses that may allow for adjustments or by focusing on measures less sensitive to market volatility. Contractor performance is monitored through regular reporting, site visits, and savings verification processes, with remedies for non-performance. The accuracy of savings projections is addressed by using established measurement and verification (M&V) protocols, often adhering to standards like the International Performance Measurement and Verification Protocol (IPMVP), and by having performance guarantees tied to the contractor's payment.

How does the 'Full and Open Competition' award mechanism impact the overall value and efficiency of this contract for taxpayers?

Awarding this contract under 'Full and Open Competition' is highly beneficial for taxpayers. It ensures that a wide range of qualified contractors have the opportunity to bid, fostering a competitive environment. This competition typically drives down prices, encourages innovation in proposed solutions, and allows the government to select the offer that provides the best overall value, considering factors beyond just cost, such as technical approach and past performance. With 21 bids received, the government had a strong basis for comparison, increasing the likelihood of securing favorable terms and maximizing the return on investment for the $17.8 million expenditure. This process helps prevent complacency and ensures that public funds are used efficiently.

What is the significance of the 'Delivery Order' award type in the context of this contract?

The 'Delivery Order' award type suggests that this contract is likely a task order issued under a larger indefinite-delivery, indefinite-quantity (IDIQ) contract or a similar pre-negotiated agreement. This means that the basic terms, conditions, pricing structure, and contractor qualifications have already been established. Issuing a delivery order allows the agency to procure specific goods or services (in this case, ESPC services for Naval Station Newport) efficiently without needing to conduct a full, separate procurement process for each individual requirement. This streamlines the acquisition process, reduces administrative burden, and can lead to faster project execution, while still leveraging the competitive nature of the underlying IDIQ contract.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 21

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Parent Company: Honeywell Safety Products USA, Inc.

Address: 1250 W SAM HOUSTON PKWY S, HOUSTON, TX, 77042

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

Financial Breakdown

Contract Ceiling: $19,172,871

Exercised Options: $19,172,871

Current Obligation: $17,880,615

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Parent Contract

Parent Award PIID: DEAM3699EE73584

IDV Type: IDC

Timeline