DoD Awards $7.18M Energy Savings Contract to Honeywell for 25 Years
Contract Overview
Contract Amount: $7,177,470 ($7.2M)
Contractor: Honeywell International, Inc
Awarding Agency: Department of Defense
Start Date: 2016-12-13
End Date: 2041-12-12
Contract Duration: 9,130 days
Daily Burn Rate: $786/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: IGF::CT::IGF AWARD OF ENERGY SAVINGS PERFORMANCE CONTRACT
Place of Performance
Location: TINKER AFB, OKLAHOMA County, OKLAHOMA, 73145
State: Oklahoma Government Spending
Plain-Language Summary
Department of Defense obligated $7.2 million to HONEYWELL INTERNATIONAL, INC for work described as: IGF::CT::IGF AWARD OF ENERGY SAVINGS PERFORMANCE CONTRACT Key points: 1. Contract awarded to a single large business, Honeywell International, Inc. 2. Long duration of 25 years raises questions about long-term value and adaptability. 3. Engineering services sector, with a focus on energy savings, is a critical area for government efficiency. 4. The contract's fixed-price nature aims to control costs, but performance monitoring is key.
Value Assessment
Rating: fair
The contract value of $7.18M over 25 years averages to approximately $287,000 annually. Benchmarking this against similar long-term energy savings performance contracts is difficult without more specific service details, but the duration suggests a significant project scope.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating a competitive bidding process. However, the long duration and specialized nature of energy savings performance contracts might limit the number of truly competitive bids.
Taxpayer Impact: The long-term nature of the contract means taxpayer funds are committed for an extended period. The success of this contract hinges on achieving projected energy savings to justify the investment.
Public Impact
Potential for significant long-term energy cost reductions for the Department of Defense. Commitment of federal funds over 25 years requires ongoing scrutiny of performance and value. Impact on environmental sustainability goals through energy efficiency improvements. Opportunity for innovation in energy management technologies and practices.
Waste & Efficiency Indicators
Waste Risk Score: 78 / 10
Warning Flags
- Long contract duration (25 years) may not adapt to future technological changes.
- Sole awardee (Honeywell) limits immediate competitive pressure on pricing and innovation.
- Lack of specific performance metrics makes it hard to assess value upfront.
Positive Signals
- Awarded under full and open competition.
- Focus on energy savings aligns with government efficiency and sustainability goals.
- Firm fixed-price contract provides cost certainty.
Sector Analysis
This contract falls within the Engineering Services sector, specifically focusing on energy savings performance. Government spending in this area aims to reduce operational costs and meet sustainability mandates. Benchmarks for long-term ESPCs vary widely based on scope and technology.
Small Business Impact
The contract was awarded to Honeywell International, Inc., a large business. There is no indication of subcontracting opportunities for small businesses within the provided data, which is a missed opportunity for small business participation.
Oversight & Accountability
The long 25-year duration necessitates robust oversight from the Defense Logistics Agency to ensure Honeywell meets performance targets and delivers the promised energy savings. Regular performance reviews and audits will be crucial for accountability.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Logistics Agency Programs
Risk Flags
- Long contract duration (25 years)
- Potential for technological obsolescence
- Limited visibility into specific performance metrics
- Lack of small business participation noted
Tags
engineering-services, department-of-defense, ok, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $7.2 million to HONEYWELL INTERNATIONAL, INC. IGF::CT::IGF AWARD OF ENERGY SAVINGS PERFORMANCE CONTRACT
Who is the contractor on this award?
The obligated recipient is HONEYWELL INTERNATIONAL, INC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $7.2 million.
What is the period of performance?
Start: 2016-12-13. End: 2041-12-12.
How will the agency ensure the projected energy savings are realized and validated over the 25-year contract term?
The agency must establish clear, measurable performance metrics and a rigorous verification process. Regular audits and performance reviews, potentially involving third-party experts, will be essential to track actual energy savings against projections. The contract should include mechanisms for adjustments or penalties if savings targets are not met, ensuring accountability and taxpayer value.
What is the risk of technological obsolescence or the need for upgrades within a 25-year energy savings contract?
There is a significant risk of technological obsolescence over a 25-year period. The contract should ideally include provisions for periodic reviews and potential renegotiation for technology upgrades or incorporate performance-based incentives that encourage the adoption of newer, more efficient technologies as they emerge, mitigating the risk of outdated systems.
How does the fixed-price nature of this contract balance cost certainty with the potential for unforeseen challenges in energy savings projects?
A firm fixed-price contract offers cost certainty for the government, protecting against cost overruns. However, it places the risk of unforeseen challenges or lower-than-expected savings on the contractor. The agency must ensure the initial pricing accurately reflects the project's complexity and that the contractor has adequately factored in potential risks.
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: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Solicitation ID: SP060015R0413
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Honeywell Safety Products USA, Inc.
Address: 1985 DOUGLAS DRIVE, GOLDEN VALLEY, MN, 55422
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $649,506,913
Exercised Options: $649,506,913
Current Obligation: $7,177,470
Actual Outlays: $2,893,520
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DEAM3609GO29035
IDV Type: IDC
Timeline
Start Date: 2016-12-13
Current End Date: 2041-12-12
Potential End Date: 2041-12-12 00:00:00
Last Modified: 2026-01-23
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