Defense contract for energy services awarded to Energy Performance Services Inc. for over $175 million

Contract Overview

Contract Amount: $16,838,919 ($16.8M)

Contractor: Energy Performance Services Inc

Awarding Agency: Department of Defense

Start Date: 2004-10-01

End Date: 2021-03-31

Contract Duration: 6,025 days

Daily Burn Rate: $2.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 7

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: 200212!009600!97AS!0600 !DEFENSE ENERGY SUPPORT CENTER !DEAC0599OR22702!C!N! !Y!SP060002F8256 !20020711!20070630!175041961!175041961!175041961!N!ENERGY PERFORMANCE SERVICES, I!2003 RENAISSANCE BLVD !KING OF PRUSSI !PA!19406!11280!041!42!CARLISLE BARRACKS !CUMBERLAND !PENN !+000016349480!N!Y!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !4000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!S! ! !A!20031001!B! ! !A! !A! !J! !007!B! !C! ! ! ! ! !B!N!N! ! !Z!Z!A!A!000! !B!N! ! ! ! ! ! !0001!

Place of Performance

Location: CARLISLE, CUMBERLAND County, PENNSYLVANIA, 17013

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $16.8 million to ENERGY PERFORMANCE SERVICES INC for work described as: 200212!009600!97AS!0600 !DEFENSE ENERGY SUPPORT CENTER !DEAC0599OR22702!C!N! !Y!SP060002F8256 !20020711!20070630!175041961!175041961!175041961!N!ENERGY PERFORMANCE SERVICES, I!2003 RENAISSANCE BLVD !KING OF PRUSSI !PA!19406!11280!041!42!CARLISLE BARRACKS !CUMBE… Key points: 1. The contract value of over $175 million represents a significant investment in energy performance services for the Department of Defense. 2. Competition dynamics for this contract are assessed as 'full and open,' suggesting a potentially competitive bidding process. 3. The contract duration of approximately 16 years indicates a long-term commitment to energy efficiency initiatives. 4. The primary service category is Engineering Services, aligning with the need for specialized expertise in energy solutions. 5. The contract's geographic scope appears to be primarily within Pennsylvania, based on the contractor's address. 6. The absence of small business set-aside flags suggests this was not specifically targeted towards small business participation.

Value Assessment

Rating: fair

The total contract value of $175,041,961 over its extended period of performance (approximately 16 years) suggests a substantial investment. Benchmarking this against similar energy performance contracts is challenging without more specific details on the scope of services and the energy savings achieved. However, the sheer scale of the award indicates a significant project. The firm-fixed-price nature of the contract provides cost certainty for the government, but the long duration could introduce risks if market conditions or technological needs change significantly.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'full and open competition,' indicating that all responsible sources were permitted to submit a bid. The presence of 7 bids suggests a reasonably competitive environment, which is generally favorable for price discovery and achieving value for money. However, the specific number of bidders does not inherently guarantee the most competitive outcome without further analysis of bid prices and technical proposals.

Taxpayer Impact: A full and open competition, with multiple bidders, generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and better service offerings.

Public Impact

The Department of Defense is the primary beneficiary, receiving energy performance services aimed at improving efficiency and potentially reducing operational costs. Services delivered likely include energy audits, retrofitting, system upgrades, and ongoing energy management to enhance facility performance. The contract's impact is geographically concentrated in Pennsylvania, where Carlisle Barracks is located, suggesting localized improvements. The contract supports specialized jobs within the energy services and engineering sectors, contributing to the workforce in these fields.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (approx. 16 years) may lead to risks associated with technological obsolescence or changing energy market dynamics.
Limited public information on specific performance metrics and achieved energy savings makes it difficult to fully assess value for money.
The contract's focus on a single location (Carlisle Barracks) might limit broader applicability or scalability of the energy solutions.

Positive Signals

Awarded under full and open competition, indicating a potentially robust bidding process.
Firm-fixed-price contract type provides cost certainty for the government.
The contractor, Energy Performance Services Inc., has a substantial contract award, suggesting established capabilities in the field.

Sector Analysis

This contract falls within the Engineering Services sector, specifically focusing on energy performance. The market for energy efficiency services for government facilities is substantial, driven by mandates for sustainability and cost savings. This contract represents a significant portion of spending within this niche, likely involving complex projects to upgrade and manage energy systems in large federal installations. Comparable benchmarks would involve other large-scale energy savings performance contracts (ESPCs) awarded to federal agencies.

Small Business Impact

There is no indication of a small business set-aside for this contract, nor are there explicit mentions of subcontracting goals for small businesses. This suggests that the primary award was not structured to prioritize small business participation, and opportunities for small businesses would likely arise through direct subcontracting by the prime contractor, if pursued.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting agency (Department of Defense, specifically Defense Logistics Agency) through contract officers and technical representatives. Performance monitoring, invoicing review, and compliance checks are standard oversight mechanisms. Transparency is generally maintained through contract databases, though specific performance data might be less publicly accessible. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Energy Savings Performance Contracts (ESPCs)
Department of Defense Facilities Management
Federal Energy Management Program (FEMP)
Engineering and Technical Services
Government Building Modernization

Risk Flags

Long contract duration may increase risk of technological obsolescence.
Performance metrics and achieved savings are not readily available for public assessment.
Potential for cost overruns if energy market conditions change significantly.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $16.8 million to ENERGY PERFORMANCE SERVICES INC. 200212!009600!97AS!0600 !DEFENSE ENERGY SUPPORT CENTER !DEAC0599OR22702!C!N! !Y!SP060002F8256 !20020711!20070630!175041961!175041961!175041961!N!ENERGY PERFORMANCE SERVICES, I!2003 RENAISSANCE BLVD !KING OF PRUSSI !PA!19406!11280!041!42!CARLISLE BARRACKS !CUMBERLAND !PENN !+000016349480!N!Y!000000000000!R499!OTHER PROFESSIONAL SERVICES !S1 !SERVICES !4000!NOT DISCERNABLE OR CLASSIFIED !541330!E! !5!B!S! ! !A!20031001!B

Who is the contractor on this award?

The obligated recipient is ENERGY PERFORMANCE SERVICES INC.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Logistics Agency).

What is the total obligated amount?

The obligated amount is $16.8 million.

What is the period of performance?

Start: 2004-10-01. End: 2021-03-31.

What is the track record of Energy Performance Services Inc. on similar federal contracts?

Energy Performance Services Inc. (EPS) has a history of securing significant federal contracts, particularly in the realm of energy efficiency and facility modernization. Their awards often involve complex projects aimed at reducing energy consumption and operational costs for government installations. While this specific contract is substantial, EPS has likely managed other large-scale Energy Savings Performance Contracts (ESPCs) for various federal agencies. A deeper dive into their past performance, including project completion success, adherence to schedules and budgets, and client satisfaction feedback, would provide a more comprehensive understanding of their capabilities and reliability. Reviewing data on previous contract awards and their outcomes can help assess their experience in delivering promised energy savings and technical solutions.

How does the awarded amount compare to the typical cost of similar energy performance contracts?

The awarded amount of over $175 million for Energy Performance Services, Inc. is substantial and falls within the upper range for large-scale Energy Savings Performance Contracts (ESPCs). ESPCs can vary widely in cost depending on the size and complexity of the facility, the scope of the energy conservation measures (ECMs) to be implemented, and the duration of the contract. Contracts of this magnitude typically involve comprehensive upgrades to major building systems, such as HVAC, lighting, and building controls, across multiple facilities or a very large single installation. To benchmark effectively, one would need to compare it with other ESPCs awarded by the Department of Defense or other federal agencies for similar types of installations (e.g., military bases) and with comparable project scopes and performance periods. The long duration (approx. 16 years) also influences the total contract value.

What are the primary risks associated with a contract of this duration and scope?

A contract spanning approximately 16 years carries several inherent risks. Firstly, technological obsolescence is a significant concern; energy-efficient technologies evolve rapidly, and measures implemented early in the contract might become outdated before its completion. Secondly, market volatility in energy prices could impact the projected savings and the financial viability of the project if not adequately accounted for in the contract's baseline calculations. Thirdly, changes in federal energy policy or budget priorities could affect the project's continuation or scope. Finally, the long-term nature of the contract requires sustained government oversight and contractor performance management to ensure objectives are met and that the government continues to receive value throughout the contract's life.

What are the expected performance metrics and how is success measured?

For an Energy Savings Performance Contract (ESPC), success is typically measured by the actual energy and cost savings achieved by the implemented measures, compared to a pre-defined baseline. Key performance indicators (KPIs) often include reductions in kilowatt-hours (kWh) consumed, natural gas usage, water consumption, and associated utility costs. The contract likely specifies a Measurement and Verification (M&V) plan, detailing how savings will be tracked, calculated, and reported periodically (e.g., annually). The contractor is usually obligated to guarantee a certain level of savings, and failure to meet these guarantees may result in financial penalties or require corrective actions. The government's technical representatives would monitor these M&V reports and conduct site inspections to ensure compliance and validate savings.

How does this contract fit into the broader context of federal energy management initiatives?

This contract aligns directly with the federal government's long-standing commitment to improving energy efficiency and reducing its environmental footprint. Initiatives like the Energy Policy Act of 2005 and subsequent executive orders have mandated agencies to reduce energy consumption and increase the use of renewable energy. ESPCs are a primary tool used by agencies to achieve these goals without upfront capital investment, as the project costs are typically financed through the energy savings realized over time. This contract, by focusing on energy performance services for a Department of Defense facility, contributes to the agency's efforts to meet its sustainability targets, enhance energy security, and reduce operational expenditures, thereby supporting broader federal energy management objectives.

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

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 7

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 116 JOHN ST, LOWELL, MA, 01852

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business

Financial Breakdown

Contract Ceiling: $10,084,672

Exercised Options: $10,084,672

Current Obligation: $16,838,919

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DEAC0599OR22702

IDV Type: IDC

Timeline