Department of the Army spent $37.5M on electricity supply in FY13, awarded through full and open competition

Contract Overview

Contract Amount: $37,525,626 ($37.5M)

Contractor: Foreign Utility Consolidated Reporting

Awarding Agency: Department of Defense

Start Date: 2012-10-01

End Date: 2013-09-30

Contract Duration: 364 days

Daily Burn Rate: $103.1K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 4

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: FY 13 UTILITY SERVICES (ELECTRICITY SUPPLY COMPETED) OCTOBER

Plain-Language Summary

Department of Defense obligated $37.5 million to FOREIGN UTILITY CONSOLIDATED REPORTING for work described as: FY 13 UTILITY SERVICES (ELECTRICITY SUPPLY COMPETED) OCTOBER Key points: 1. The contract achieved a competitive award, suggesting potential for value for money. 2. Full and open competition indicates a broad market engagement, potentially driving favorable pricing. 3. The firm fixed-price contract type transfers risk to the contractor, a positive indicator. 4. The contract duration of one year is standard for utility services, allowing for regular re-competition. 5. The award amount of $37.5M for a single year of electricity supply requires benchmarking against similar utility contracts. 6. The absence of small business set-aside suggests the primary focus was on best value rather than specific socio-economic goals.

Value Assessment

Rating: good

The contract value of $37.5 million for one year of electricity supply appears substantial. Benchmarking against similar utility contracts for military installations or large federal facilities would be necessary to definitively assess value for money. The firm fixed-price nature is a positive sign for cost control, assuming the base price was competitive. Without specific per-unit cost data or comparisons to market rates for electricity in the relevant geographic area, a precise value assessment is challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The data shows 4 bids were received, which is a healthy number for a utility service contract. This level of competition is generally expected to lead to more competitive pricing and better value for the government, as contractors vie to win the award.

Taxpayer Impact: The robust competition for this electricity supply contract is beneficial for taxpayers, as it likely resulted in a lower price than a sole-source or limited competition award would have.

Public Impact

The primary beneficiaries are the Department of Defense and specifically the Department of the Army, ensuring a critical utility service for its operations. The service delivered is the supply of electricity, essential for powering facilities, equipment, and supporting personnel. The geographic impact is localized to the facilities managed by the Department of the Army that received this electricity supply. Workforce implications are indirect, primarily related to the contractor's personnel managing the electricity supply chain and infrastructure.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases in future contract renewals if market conditions change significantly.
Dependence on a single contractor for a critical utility service could pose a risk if performance issues arise.

Positive Signals

Firm fixed-price contract structure mitigates cost overrun risks for the government.
Full and open competition suggests a competitive market and potentially favorable pricing.
The contract was awarded by the Department of the Army, a major federal agency with established procurement processes.

Sector Analysis

The energy sector, specifically utility services, is a critical component of federal operations. Federal agencies are significant consumers of electricity, and contracts for these services are often large and long-term. This contract for electricity supply fits within the broader category of essential services procurement, where reliability and cost-effectiveness are paramount. Benchmarking against other federal utility contracts or large commercial energy agreements would provide further context on the $37.5 million expenditure.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the procurement likely focused on obtaining the best overall value from a wide range of potential offerors, rather than prioritizing small business participation. There is no information provided on subcontracting plans, so the impact on the small business ecosystem is not directly discernible from this data alone.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the firm fixed-price contract type, which obligates the contractor to deliver the specified service at the agreed-upon price. Transparency is generally provided through contract award databases like FPDS, where this information is sourced. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Utility Services Contracts
Department of Defense Energy Procurement
Army Facilities Management
Electric Power Distribution Contracts

Risk Flags

Potential for price volatility in energy markets
Contractor performance risk for essential utility service
Dependence on single source for critical infrastructure support

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $37.5 million to FOREIGN UTILITY CONSOLIDATED REPORTING. FY 13 UTILITY SERVICES (ELECTRICITY SUPPLY COMPETED) OCTOBER

Who is the contractor on this award?

The obligated recipient is FOREIGN UTILITY CONSOLIDATED REPORTING.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $37.5 million.

What is the period of performance?

Start: 2012-10-01. End: 2013-09-30.

What was the contractor's track record with the federal government prior to this award?

The provided data does not include specific information about the contractor's prior federal track record. To assess this, one would need to research the contractor's award history in the Federal Procurement Data System (FPDS) or other government contracting databases. Key metrics to examine would include past performance ratings on similar contracts, any history of contract disputes or terminations, and the overall volume and type of work previously performed for the government. A contractor with a strong, positive history on similar utility service contracts would generally be considered lower risk.

How does the $37.5 million award compare to other federal electricity supply contracts of similar scope and duration?

Benchmarking this $37.5 million award against similar federal electricity supply contracts is crucial for assessing value. Contracts for large military installations or federal agency campuses can vary significantly based on location, demand, and market conditions. For instance, a contract for a single year of electricity supply to a major base in a high-cost region might reasonably be in this range. Conversely, if comparable contracts for similar-sized facilities in less expensive areas are significantly lower, it could indicate potential overpricing or a less competitive outcome than expected. Detailed analysis would require comparing kilowatt-hour usage, peak demand, and contract terms across multiple awards.

What were the specific risks identified during the procurement process, and how were they mitigated?

The provided data does not detail specific risks identified during the procurement process. However, common risks for utility service contracts include price volatility of electricity, potential for service disruptions, contractor performance issues, and changes in regulatory requirements. The firm fixed-price contract type mitigates financial risk for the government regarding price fluctuations. The full and open competition likely aimed to select a contractor with a proven ability to manage operational risks and ensure reliable service delivery. Further mitigation might involve performance bonds, service level agreements, and contingency planning by the Army.

How effective has the Department of the Army been in managing its utility service contracts over the past decade?

Assessing the overall effectiveness of the Department of the Army's utility contract management requires a broader analysis of multiple contracts over time. This specific contract represents a single data point. Generally, effectiveness can be gauged by factors such as consistent service delivery, adherence to budget, successful re-competition at competitive prices, and minimal contract disputes. Analyzing trends in spending, contract types, and performance outcomes across the Army's portfolio of utility contracts would provide a more comprehensive view of their management effectiveness.

What is the historical spending trend for electricity supply by the Department of the Army?

To determine the historical spending trend for electricity supply by the Department of the Army, one would need to aggregate data from FPDS or similar sources over multiple fiscal years. This would involve filtering for contracts with relevant Product Service Codes (PSCs) related to electricity and energy supply, awarded by the Department of the Army. Analyzing this aggregated data would reveal whether spending has increased, decreased, or remained stable, and whether the average contract values or quantities have changed. This trend analysis is essential for understanding long-term budget planning and identifying potential shifts in energy consumption or procurement strategies.

Were there any specific performance metrics or service level agreements (SLAs) associated with this contract?

The provided data summary does not specify the performance metrics or service level agreements (SLAs) tied to this contract. However, for a critical utility service like electricity supply, it is highly probable that such metrics were included. These would typically involve requirements for reliability (e.g., uptime percentages, maximum allowable outage durations), power quality, response times for outages, and potentially energy efficiency targets. The firm fixed-price nature suggests that meeting these performance standards was a condition of payment, and failure to do so could result in penalties or contract remedies.

Industry Classification

NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W912CM12R4001

Offers Received: 4

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1275 FIRST ST NE, WASHINGTON, DC, 98

Business Categories: Category Business, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $37,525,626

Exercised Options: $37,525,626

Current Obligation: $37,525,626

Contract Characteristics

Cost or Pricing Data: NO

Timeline