VA's $10.16M Utility Energy Services Contract for Fresno Medical Center awarded to Pacific Gas and Electric Company

Contract Overview

Contract Amount: $10,162,227 ($10.2M)

Contractor: Pacific GAS and Electric Company

Awarding Agency: Department of Veterans Affairs

Start Date: 2017-09-28

End Date: 2030-12-27

Contract Duration: 4,838 days

Daily Burn Rate: $2.1K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: IGF::OT::IGF OTHER FUNCTIONS - UTILITY ENERGY SERVICES CONTRACT (UESC) FOR VISN 21 SIERRA PACIFIC NETWORK VA MEDICAL CENTER IN FRESNO, CA.

Place of Performance

Location: FRESNO, FRESNO County, CALIFORNIA, 93703

State: California Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $10.2 million to PACIFIC GAS AND ELECTRIC COMPANY for work described as: IGF::OT::IGF OTHER FUNCTIONS - UTILITY ENERGY SERVICES CONTRACT (UESC) FOR VISN 21 SIERRA PACIFIC NETWORK VA MEDICAL CENTER IN FRESNO, CA. Key points: 1. Contract aims to improve energy efficiency and reduce utility costs at the VA Medical Center. 2. Long-term contract duration suggests a strategic investment in infrastructure upgrades. 3. Focus on electric power distribution indicates a need for reliable and efficient energy supply. 4. The contract's value is significant, requiring careful monitoring of performance and cost-effectiveness. 5. Limited competition raises questions about potential price optimization and value for taxpayer dollars.

Value Assessment

Rating: fair

The contract value of $10.16 million over its term appears substantial for utility services. Benchmarking against similar Utility Energy Services Contracts (UESCs) for federal facilities is crucial to assess value for money. Without specific details on the scope of work and expected energy savings, it's difficult to definitively assess if the pricing is competitive or if it represents a good deal for the government. The long duration (over 13 years) suggests a significant project, and the effectiveness will depend on the realized energy savings and operational improvements.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating that Pacific Gas and Electric Company was the only vendor considered. This approach is often used when a specific utility provider has exclusive rights to serve a particular geographic area or when the nature of the service requires a unique provider. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices or spurred innovation from multiple vendors.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as there is no competitive pressure to ensure the most economical price. It also limits the opportunity for other qualified companies to secure government contracts.

Public Impact

Benefits the Department of Veterans Affairs by ensuring reliable and efficient energy supply for the Fresno Medical Center. Services delivered include improvements to electric power distribution, potentially leading to reduced energy consumption and operational costs. Geographic impact is localized to the VA Medical Center in Fresno, California. Workforce implications are likely related to the maintenance and operation of upgraded energy infrastructure, potentially involving specialized technicians.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing opportunities.
Long contract duration requires sustained oversight to ensure continued value.
Lack of detailed performance metrics makes it difficult to assess efficiency gains upfront.

Positive Signals

Addresses critical infrastructure needs for a vital federal facility.
Long-term commitment can lead to significant, sustained energy savings.
Focus on energy efficiency aligns with government sustainability goals.

Sector Analysis

Utility Energy Services Contracts (UESCs) are a common mechanism for federal agencies to improve energy efficiency and reduce utility costs. These contracts often involve private utility companies performing energy conservation measures and infrastructure upgrades. The market for such services is substantial, with numerous utility providers and energy service companies operating nationwide. This contract fits within the broader energy sector, specifically focusing on electric power distribution and efficiency improvements within a federal healthcare facility.

Small Business Impact

This contract does not appear to have a small business set-aside component, as it was awarded sole-source to a large utility provider. There is no explicit information regarding subcontracting opportunities for small businesses within this specific award. The focus on a large utility company's services may limit direct opportunities for small businesses in this particular contract, though they may be involved in ancillary services or future projects.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of Veterans Affairs' contracting and program management offices. Accountability measures would be tied to the performance metrics and deliverables outlined in the contract. Transparency is facilitated through contract databases, but detailed operational oversight and inspector general jurisdiction would depend on the specific terms and any potential issues that arise during the contract's lifecycle.

Related Government Programs

Utility Energy Services Contracts (UESCs)
Energy Efficiency and Conservation Block Grants
Federal Energy Management Program (FEMP)
Department of Veterans Affairs Medical Facility Operations

Risk Flags

Sole-source award limits price competition.
Long contract duration requires sustained oversight.
Potential for cost overruns if not managed effectively.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $10.2 million to PACIFIC GAS AND ELECTRIC COMPANY. IGF::OT::IGF OTHER FUNCTIONS - UTILITY ENERGY SERVICES CONTRACT (UESC) FOR VISN 21 SIERRA PACIFIC NETWORK VA MEDICAL CENTER IN FRESNO, CA.

Who is the contractor on this award?

The obligated recipient is PACIFIC GAS AND ELECTRIC COMPANY.

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 $10.2 million.

What is the period of performance?

Start: 2017-09-28. End: 2030-12-27.

What specific energy conservation measures are included in this UESC, and what are the projected energy savings?

The provided data does not detail the specific energy conservation measures (ECMs) to be implemented under this Utility Energy Services Contract (UESC). UESCs typically involve a range of upgrades such as lighting retrofits, HVAC system improvements, building envelope enhancements, and water conservation measures. Projected energy savings are a critical component of UESC justification, as they often fund the upfront costs of the project through guaranteed savings. Without this information, it is impossible to assess the potential return on investment or the true value of the $10.16 million expenditure. The Department of Veterans Affairs would have this information in the contract's technical exhibits and energy savings performance contract (ESPC) proposal.

How does the $10.16 million contract value compare to similar UESCs for VA medical centers of comparable size?

Comparing the $10.16 million contract value requires data on similar UESCs awarded to VA medical centers of comparable size and scope. Factors such as the age and condition of the facility, existing energy infrastructure, climate zone, and the specific types of energy conservation measures included significantly influence contract costs. Without access to a database of comparable UESC contracts, including their total value, duration, and scope of work, a precise benchmark is not possible. However, for a large medical center, a multi-year UESC in the range of $10 million could be within a reasonable spectrum if it encompasses substantial infrastructure upgrades and long-term energy efficiency improvements.

What are the key performance indicators (KPIs) for this contract, and how will performance be measured?

The provided data does not specify the key performance indicators (KPIs) for this contract. For a UESC, typical KPIs would revolve around guaranteed energy savings (measured in kilowatt-hours, therms, or dollar amounts), operational cost reductions, system reliability improvements, and compliance with environmental standards. Performance measurement usually involves baseline energy consumption data compared against post-implementation consumption, often verified by the utility provider and potentially audited by the agency or a third party. The contract's terms and conditions would outline the specific measurement and verification (M&V) plan.

What is the track record of Pacific Gas and Electric Company in executing federal UESCs?

Pacific Gas and Electric Company (PG&E) is a major utility provider in California and has likely executed numerous energy-related projects, including potentially some for federal facilities within its service territory. However, specific details on their track record with federal Utility Energy Services Contracts (UESCs) are not provided in the given data. Federal agencies typically vet contractors based on past performance, including their experience with similar projects, financial stability, and ability to meet contractual obligations. A review of PG&E's past federal contracts, client references, and any performance evaluations would be necessary to fully assess their track record in this specific area.

Given the sole-source nature, what mechanisms are in place to ensure fair pricing and prevent cost overruns?

When a contract is awarded sole-source, ensuring fair pricing and preventing cost overruns relies heavily on pre-award negotiations, robust contract terms, and ongoing oversight. Mechanisms may include requiring the contractor to provide detailed cost breakdowns, market research on component pricing, and justification for their proposed profit margins. The contract itself should include clear deliverables, performance standards, and payment schedules tied to successful completion. The Department of Veterans Affairs' contracting officers would have conducted a price analysis to determine if the proposed price was fair and reasonable based on available information, even without competition. Continuous monitoring of expenditures against milestones and deliverables is crucial.

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 300 LAKESIDE DR, OAKLAND, CA, 94612

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

Financial Breakdown

Contract Ceiling: $10,683,669

Exercised Options: $10,162,227

Current Obligation: $10,162,227

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $6,076,639

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P14BSD1137

IDV Type: IDC

Timeline