NASA's $22.3M Electricity Contract for Wallops Facility Lacks Competition, Raises Cost Concerns
Contract Overview
Contract Amount: $22,296,748 ($22.3M)
Contractor: A & N Electric Cooperative
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2010-11-01
End Date: 2015-10-31
Contract Duration: 1,825 days
Daily Burn Rate: $12.2K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: ELECTRICITY DISTRIBUTION SERVICES AT THE WALLOPS FLIGHT FACILITY.
Place of Performance
Location: WALLOPS ISLAND, ACCOMACK County, VIRGINIA, 23337
State: Virginia Government Spending
Plain-Language Summary
National Aeronautics and Space Administration obligated $22.3 million to A & N ELECTRIC COOPERATIVE for work described as: ELECTRICITY DISTRIBUTION SERVICES AT THE WALLOPS FLIGHT FACILITY. Key points: 1. Significant spending on essential utility services. 2. Lack of competition suggests potential for inflated costs. 3. Long-term contract duration may limit market responsiveness. 4. Analysis focuses on cost-effectiveness and competitive sourcing.
Value Assessment
Rating: questionable
The contract's total value of $22.3 million over five years, with a benchmark of $12,217 per year, appears high for electricity distribution services, especially given the lack of competitive bidding. Without comparable contracts, it's difficult to definitively assess pricing, but the absence of competition is a red flag.
Cost Per Unit: $12,217
Competition Analysis
Competition Level: limited
The contract was not available for competition, likely due to the nature of utility services requiring a specific provider. This limited competition prevents price discovery through market forces, potentially leading to higher costs for the government.
Taxpayer Impact: Taxpayers may be overpaying for electricity distribution due to the lack of competitive pressure on the sole provider.
Public Impact
Essential services for a critical NASA facility. Potential for taxpayer funds to be used inefficiently. Highlights the challenges of procuring utilities in remote or specialized locations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Potentially high unit cost
- Long contract duration
Positive Signals
- Essential service provision
- Firm fixed price contract type
Sector Analysis
Electricity distribution is a regulated utility sector. Spending benchmarks vary widely based on location, demand, and infrastructure. This contract represents a significant expenditure for a specific government facility, where unique circumstances might influence pricing.
Small Business Impact
There is no indication that small businesses were involved in this contract, either as prime contractors or subcontractors. The sole awardee is an electric cooperative.
Oversight & Accountability
The contract was awarded by NASA, a federal agency with established oversight mechanisms. However, the lack of competition warrants scrutiny to ensure fair pricing and efficient use of funds.
Related Government Programs
- Electric Power Distribution
- National Aeronautics and Space Administration Contracting
- National Aeronautics and Space Administration Programs
Risk Flags
- Lack of competition
- Potential for overpricing
- Limited transparency in pricing
- Long contract duration may reduce flexibility
Tags
electric-power-distribution, national-aeronautics-and-space-administr, va, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $22.3 million to A & N ELECTRIC COOPERATIVE. ELECTRICITY DISTRIBUTION SERVICES AT THE WALLOPS FLIGHT FACILITY.
Who is the contractor on this award?
The obligated recipient is A & N ELECTRIC COOPERATIVE.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $22.3 million.
What is the period of performance?
Start: 2010-11-01. End: 2015-10-31.
How does the per-unit cost of electricity distribution services compare to similar government contracts in comparable geographic or operational areas?
Without access to a database of comparable contracts for electricity distribution services, a precise benchmark is difficult to establish. However, the reported benchmark of $12,217 per year for a five-year contract suggests a potential area for cost savings if competitive bidding were possible. Further analysis would require detailed cost breakdowns and comparisons with other utility contracts.
What specific factors justified the 'not available for competition' determination for this electricity distribution contract?
The justification for 'not available for competition' typically stems from the unique nature of utility services, where a single provider may hold a monopoly or exclusive franchise for a specific geographic area, such as the Wallops Flight Facility. This could be due to existing infrastructure, regulatory requirements, or the inability to physically connect to alternative providers without significant cost.
What measures are in place to ensure the effectiveness and efficiency of electricity distribution services under this sole-source contract?
While competition is absent, NASA likely has performance standards and service level agreements (SLAs) within the contract to ensure the effectiveness and efficiency of the electricity distribution. Regular performance reviews, monitoring of outages, and adherence to safety protocols would be key oversight mechanisms to hold the contractor accountable for service delivery.
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
Solicitation ID: NNG10318683R
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 21275 COOPERATIVE WAY, TASLEY, VA, 23441
Business Categories: Category Business, Nonprofit Organization, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $27,500,000
Exercised Options: $27,500,000
Current Obligation: $22,296,748
Contract Characteristics
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Timeline
Start Date: 2010-11-01
Current End Date: 2015-10-31
Potential End Date: 2015-10-31 00:00:00
Last Modified: 2018-01-17
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