Treasury's $5.89M energy savings contract with NORESCO, LLC, awarded in 2017, aims for long-term efficiency
Contract Overview
Contract Amount: $5,888,848 ($5.9M)
Contractor: Noresco, LLC
Awarding Agency: Department of the Treasury
Start Date: 2017-09-29
End Date: 2042-01-31
Contract Duration: 8,890 days
Daily Burn Rate: $662/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 5
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: ENERGEY SAVINGS PERFORMANCE CONTRACT - ESCO SERVICES
Place of Performance
Location: DENVER, DENVER County, COLORADO, 80204
State: Colorado Government Spending
Plain-Language Summary
Department of the Treasury obligated $5.9 million to NORESCO, LLC for work described as: ENERGEY SAVINGS PERFORMANCE CONTRACT - ESCO SERVICES Key points: 1. The contract leverages private sector expertise for energy efficiency upgrades, potentially reducing operational costs. 2. Full and open competition suggests a competitive bidding process, which can lead to better pricing. 3. The long duration (over 17 years) indicates a focus on sustained performance and long-term savings. 4. Performance is tied to energy savings, aligning contractor incentives with government objectives. 5. The contract falls under engineering services, supporting infrastructure modernization. 6. The absence of small business set-asides may limit direct participation for smaller firms in this specific award.
Value Assessment
Rating: good
Benchmarking energy savings performance contracts (ESPCs) is complex due to varying project scopes and energy markets. However, the fixed-price nature of this delivery order suggests a defined cost for the services. The long-term savings potential, if realized, would indicate good value. Without specific performance data or a detailed breakdown of the energy conservation measures, a precise value-for-money assessment is challenging, but the structure is designed to deliver savings.
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. This typically involves a public solicitation and a review of multiple proposals. The presence of 5 bids suggests a healthy level of interest and competition, which generally benefits the government by driving down prices and encouraging innovation.
Taxpayer Impact: A competitive bidding process helps ensure that taxpayer dollars are used efficiently by securing services at a fair market price.
Public Impact
The United States Mint benefits from reduced energy consumption and operational costs. Services include engineering and energy conservation measures to improve facility efficiency. The contract has a national scope, potentially impacting facilities across the United States. The contract supports jobs in the engineering and energy services sector.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (over 17 years) may introduce risks related to technological obsolescence or changing energy regulations.
- Performance metrics and actual savings realization need continuous monitoring to ensure value for money.
- Dependence on a single contractor (NORESCO, LLC) for a long period could limit future flexibility.
Positive Signals
- Contract awarded through full and open competition with 5 bids, indicating a competitive process.
- Fixed-price contract structure provides cost certainty for the awarded services.
- Focus on energy savings aligns with government sustainability goals and potential cost reductions.
Sector Analysis
Energy Savings Performance Contracts (ESPCs) are a key mechanism for federal agencies to improve energy efficiency and reduce utility costs without upfront capital investment. These contracts leverage private sector expertise to identify, implement, and finance energy conservation measures. The market for ESPCs is substantial, with numerous qualified Energy Service Companies (ESCOs) competing for these long-term agreements. This contract fits within the broader trend of federal agencies seeking sustainable and cost-effective facility management solutions.
Small Business Impact
This contract was not set aside for small businesses, and there is no indication of specific subcontracting requirements for small businesses in the provided data. Therefore, the direct impact on the small business ecosystem for this particular award appears limited. However, larger prime contractors like NORESCO, LLC, may engage small businesses as subcontractors for specialized services, though this is not explicitly detailed here.
Oversight & Accountability
Oversight for this contract would typically be managed by the contracting officer and the program office within the Department of the Treasury's United States Mint. Performance is monitored against the agreed-upon energy savings and project milestones. Transparency is generally maintained through contract reporting requirements. While no specific Inspector General jurisdiction is mentioned, the Treasury OIG would have oversight authority over potential fraud, waste, or abuse related to federal contracts.
Related Government Programs
- Energy Efficiency and Conservation Block Grant Program
- Federal Energy Management Program (FEMP)
- Energy Savings Performance Contracts (ESPCs)
- Department of Energy - Energy Efficiency and Renewable Energy
Risk Flags
- Long-term contract duration may lead to technological obsolescence.
- Performance verification is critical to ensure projected savings are realized.
- Potential for scope creep or changes in energy regulations over the contract's life.
Tags
energy-savings, performance-contract, engineering-services, department-of-the-treasury, united-states-mint, full-and-open-competition, firm-fixed-price, delivery-order, long-term, federal-agency, facility-management, cost-reduction
Frequently Asked Questions
What is this federal contract paying for?
Department of the Treasury awarded $5.9 million to NORESCO, LLC. ENERGEY SAVINGS PERFORMANCE CONTRACT - ESCO SERVICES
Who is the contractor on this award?
The obligated recipient is NORESCO, LLC.
Which agency awarded this contract?
Awarding agency: Department of the Treasury (United States Mint).
What is the total obligated amount?
The obligated amount is $5.9 million.
What is the period of performance?
Start: 2017-09-29. End: 2042-01-31.
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 contract. ESPCs typically encompass a range of upgrades such as lighting retrofits, HVAC system improvements, building envelope enhancements, and installation of renewable energy sources. The projected savings are usually outlined in the contract's technical exhibits and are crucial for determining the contract's overall value. Without this information, it's impossible to quantify the expected impact of each measure or the total anticipated cost reductions for the United States Mint.
How does the $5.89 million contract value compare to similar energy savings performance contracts awarded by federal agencies?
The $5.89 million value for this Energy Savings Performance Contract (ESPC) is moderate within the federal landscape. ESPCs can range from hundreds of thousands to tens or even hundreds of millions of dollars, depending on the size and complexity of the facilities being upgraded and the scope of the energy conservation measures. Contracts of this size are common for specific buildings or a group of smaller facilities. Larger, agency-wide ESPCs or those involving major infrastructure overhauls would typically command significantly higher values. The key metric for comparison is not just the upfront cost but the projected long-term energy savings and return on investment.
What are the primary risks associated with a contract duration extending to 2042?
A contract duration extending to January 31, 2042 (over 17 years) presents several risks. Firstly, technological advancements in energy efficiency could render the implemented solutions obsolete or less effective before the contract ends. Secondly, energy markets and utility rates are subject to significant fluctuations, which could impact the accuracy of the original savings projections. Thirdly, regulatory changes related to energy standards or environmental policies might necessitate modifications or upgrades not initially planned. Finally, maintaining consistent performance and accountability from the contractor over such a long period requires robust ongoing oversight and potential adjustments to the agreement.
What is NORESCO, LLC's track record with federal ESPCs, and have they successfully delivered on similar projects?
NORESCO, LLC, is a well-established Energy Service Company (ESCO) with a significant history of performing federal Energy Savings Performance Contracts (ESPCs). They have been involved in numerous projects across various federal agencies, including the Department of Defense, Department of Energy, and others. Their track record generally includes the successful implementation of a wide array of energy conservation measures and the achievement of guaranteed energy savings. Specific performance details for individual contracts, including success rates and any past issues, would typically be available through federal procurement databases and agency performance reports, but their longevity and continued awards suggest a generally positive performance history.
How does the fixed-price nature of this delivery order impact potential cost overruns or savings?
The 'FIRM FIXED PRICE' (FFP) contract type for this delivery order means that the contractor, NORESCO, LLC, is obligated to complete the work for a predetermined price, regardless of the actual costs incurred. This structure shifts the risk of cost overruns to the contractor. For the government, it provides budget certainty. If the contractor can deliver the services more efficiently than anticipated, they may realize a higher profit margin. Conversely, if costs exceed the fixed price, the contractor absorbs the loss. This pricing model incentivizes the contractor to manage costs effectively and deliver the agreed-upon energy savings within the specified budget.
What are the implications of this contract being awarded as a 'Delivery Order' under a larger contract?
This contract being a 'Delivery Order' (awarded under contract number 'st' which is not fully specified but implies a parent contract) means it's a specific task or order placed against a previously awarded indefinite-delivery/indefinite-quantity (IDIQ) or similar type of contract. This approach allows agencies to procure services incrementally as needed. For the United States Mint, it signifies a specific project or phase of work within a broader energy services framework. The 'Delivery Order' itself has a fixed price and duration, but it is governed by the terms and conditions of the parent contract. This method can streamline procurement for defined tasks and allows for flexibility in project scope and timing.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SPECIAL STUDIES/ANALYSIS, NOT R&D › SPECIAL STUDIES - NOT R and D
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 5
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 RESEARCH DR STE 400 C, WESTBOROUGH, MA, 01581
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $5,888,849
Exercised Options: $5,888,848
Current Obligation: $5,888,848
Actual Outlays: $5,077,700
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DEAM3609GO29039
IDV Type: IDC
Timeline
Start Date: 2017-09-29
Current End Date: 2042-01-31
Potential End Date: 2042-01-31 00:00:00
Last Modified: 2026-03-03
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