VA awards $18.6M for Los Angeles solar project, highlighting renewable energy investment

Contract Overview

Contract Amount: $18,657,615 ($18.7M)

Contractor: REC Solar Commercial Corporation

Awarding Agency: Department of Veterans Affairs

Start Date: 2011-06-29

End Date: 2016-09-29

Contract Duration: 1,919 days

Daily Burn Rate: $9.7K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: TURN-KEY SOLAR PHOTOVOLTAIC SYSTEM AT THE WEST LOS ANGELES VA MEDICAL CENTER.

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90073

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $18.7 million to REC SOLAR COMMERCIAL CORPORATION for work described as: TURN-KEY SOLAR PHOTOVOLTAIC SYSTEM AT THE WEST LOS ANGELES VA MEDICAL CENTER. Key points: 1. Contract value represents a significant investment in renewable energy infrastructure for a major VA facility. 2. The project aimed to enhance energy independence and reduce operational costs through solar power. 3. Competition dynamics suggest a potentially efficient market for solar installation services. 4. Performance period of nearly five years indicates a substantial, long-term infrastructure commitment. 5. The award falls within the engineering services sector, supporting facility modernization. 6. Fixed-price contract type offers cost certainty for the government.

Value Assessment

Rating: good

The contract value of $18.6 million for a turn-key solar photovoltaic system at the West Los Angeles VA Medical Center appears reasonable given the scale and complexity of such an installation. Benchmarking against similar large-scale solar projects at federal facilities would provide a more precise value-for-money assessment. The fixed-price nature of the contract helps mitigate cost overruns, which is a positive indicator for value.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors were likely invited to bid. With 3 bids received, the competition level suggests a healthy market for these services, which typically leads to more competitive pricing and better value for the government. The agency's choice of full and open competition is generally the preferred method for maximizing competition.

Taxpayer Impact: Full and open competition generally results in lower prices for taxpayers by encouraging a wider range of bidders to offer their best pricing and innovative solutions.

Public Impact

The primary beneficiaries are the Department of Veterans Affairs and the veterans receiving care at the West Los Angeles VA Medical Center, through improved facility operations and potentially lower energy costs. The project delivers a turn-key solar photovoltaic system, providing a sustainable and renewable energy source. The geographic impact is localized to the West Los Angeles VA Medical Center in California. The project likely involved skilled labor in engineering, procurement, and construction, potentially creating or sustaining jobs in the renewable energy sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if initial project scope underestimated complexity.
Dependence on solar energy generation can be subject to weather variability.
Long-term maintenance costs for the solar system need careful management.
Integration challenges with existing power infrastructure.

Positive Signals

Significant investment in renewable energy aligns with federal sustainability goals.
Fixed-price contract provides budget certainty.
Full and open competition likely secured competitive pricing.
Turn-key solution simplifies project management for the VA.
Potential for long-term operational cost savings.

Sector Analysis

The contract falls within the Engineering Services sector (NAICS 541330), specifically related to the design and implementation of renewable energy infrastructure. The market for solar photovoltaic systems, particularly for large commercial and government installations, has seen significant growth driven by declining costs, environmental concerns, and government incentives. This contract represents a substantial investment in a specific facility, contributing to the broader trend of federal agencies adopting sustainable energy solutions.

Small Business Impact

The contract was awarded to REC SOLAR COMMERCIAL CORPORATION and does not indicate any specific small business set-aside provisions. Analysis of subcontracting opportunities for small businesses would require further investigation into the prime contractor's subcontracting plan, if one was required. Without this information, the direct impact on the small business ecosystem is unclear, though large infrastructure projects often create indirect opportunities.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and the project management team within the Department of Veterans Affairs. The fixed-price nature of the contract provides a degree of financial oversight by setting the total cost upfront. Transparency is generally maintained through contract award databases and reporting requirements. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Federal Renewable Energy Programs
VA Capital Asset and Business Process Realignment
Energy Efficiency and Conservation Block Grant Program
Department of Energy - Solar Energy Technologies Office

Risk Flags

Potential for cost overruns if scope was not fully defined.
Reliance on external factors (weather) for energy generation.
Long-term maintenance and operational costs.
Integration complexity with existing infrastructure.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $18.7 million to REC SOLAR COMMERCIAL CORPORATION. TURN-KEY SOLAR PHOTOVOLTAIC SYSTEM AT THE WEST LOS ANGELES VA MEDICAL CENTER.

Who is the contractor on this award?

The obligated recipient is REC SOLAR COMMERCIAL CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $18.7 million.

What is the period of performance?

Start: 2011-06-29. End: 2016-09-29.

What was the specific breakdown of costs within the $18.6 million award for the turn-key solar system?

The provided data does not include a detailed cost breakdown for the $18.6 million award. A turn-key solar photovoltaic system contract typically encompasses costs for system design, engineering, procurement of panels and associated equipment (inverters, mounting hardware, wiring), installation labor, project management, permitting, interconnection with the grid, and potentially commissioning and initial maintenance. Without a more granular breakdown, it is difficult to assess the cost-effectiveness of individual components or the allocation of funds across different project phases.

How does the awarded price per watt compare to industry benchmarks for similar large-scale solar installations during the contract period (2011-2016)?

To compare the awarded price per watt, we first need to estimate the system's capacity. The total award was $18,657,614.78. Without knowing the system's total wattage, a direct per-watt calculation is impossible. However, during the 2011-2016 period, large-scale solar installation costs in the US were generally decreasing. Early in this period, costs could range from $2.50 to $4.00 per watt, potentially falling below $2.00 per watt by 2016 for utility-scale projects. If this VA project was, for example, a 10 MW (10,000,000 watt) system, the cost would be around $1.87 per watt, which would have been competitive. A precise comparison requires knowing the system's nameplate capacity.

What were the key performance indicators (KPIs) used to evaluate the success of this solar project?

The provided data does not specify the key performance indicators (KPIs) for this contract. However, for a solar photovoltaic system, typical KPIs would likely include: energy production (kilowatt-hours generated over time), system uptime and reliability, adherence to budget and schedule, performance relative to predicted energy output, and potentially reduction in grid electricity consumption and associated costs. The 'turn-key' nature suggests the contractor was responsible for delivering a fully operational system meeting agreed-upon specifications.

What is the track record of REC SOLAR COMMERCIAL CORPORATION in completing large federal solar projects?

REC Solar Commercial Corporation (now part of Duke Energy Renewables) has a history of developing and constructing commercial and industrial solar projects. While specific details on their track record with large federal solar projects beyond this VA contract are not immediately available in the provided data, their involvement in a significant project like this suggests they possessed the necessary expertise and capacity. Assessing their broader federal project portfolio, including past performance, contract modifications, and client satisfaction, would require a deeper dive into federal procurement databases and potentially client feedback.

Were there any significant challenges or modifications during the contract performance period?

The provided data does not detail any specific challenges or modifications encountered during the performance of this contract. Contract modifications can arise from various factors, including changes in scope, unforeseen site conditions, delays, or adjustments to timelines. A review of the contract's history in a federal procurement database (like FPDS or SAM.gov) would be necessary to identify any amendments, change orders, or documented issues that impacted the original terms, schedule, or cost.

How has the VA's spending on renewable energy projects evolved since this contract was awarded?

Since the award of this $18.6 million contract in 2011, the VA's spending on renewable energy projects has likely increased significantly, reflecting broader federal and private sector trends. Agencies like the VA are increasingly focused on sustainability, energy resilience, and cost savings through renewable sources. This includes investments in solar, geothermal, and other clean energy technologies across their vast network of facilities. Tracking VA's energy expenditure reports and budget allocations for capital improvements and sustainability initiatives would illustrate this evolution.

Industry Classification

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

Product/Service Code: INSTALLATION OF EQUIPMENT › INSTALLATION OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Duke Energy Corporation (UEI: 006996052)

Address: 810 FIERO LN, SAN LUIS OBISPO, CA, 93401

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

Financial Breakdown

Contract Ceiling: $18,657,615

Exercised Options: $18,657,615

Current Obligation: $18,657,615

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $1,476,452

Contract Characteristics

Commercial Item: COMMERCIAL ITEM

Parent Contract

Parent Award PIID: GS21F0099V

IDV Type: FSS

Timeline