DoD awards $7.99M electric power contract to Korea Electric Power Corp. for 91 days

Contract Overview

Contract Amount: $7,987,770 ($8.0M)

Contractor: Korea Electric Power Corporation

Awarding Agency: Department of Defense

Start Date: 2025-11-01

End Date: 2026-01-31

Contract Duration: 91 days

Daily Burn Rate: $87.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FY26 TASK ORDER FOR ELECTRIC CP HUMPHREYS FROM 1 NOVEMBER 2025 TO 31 JANUARY 2026

Plain-Language Summary

Department of Defense obligated $8.0 million to KOREA ELECTRIC POWER CORPORATION for work described as: FY26 TASK ORDER FOR ELECTRIC CP HUMPHREYS FROM 1 NOVEMBER 2025 TO 31 JANUARY 2026 Key points: 1. Contract value appears reasonable for a short-term, specialized service. 2. Limited competition raises concerns about potential overpricing and reduced value. 3. Short duration suggests a specific, immediate need rather than long-term infrastructure. 4. Performance context is limited due to the short timeframe and single award. 5. Sector positioning is within defense infrastructure support, a critical but niche area.

Value Assessment

Rating: fair

The contract value of $7.99 million for a 91-day period equates to approximately $87,778 per day. Benchmarking this against similar short-term, high-demand utility services for military installations is challenging due to the specific nature of the requirement and the limited competition. Without comparable contracts or more detailed service breakdowns, it's difficult to definitively assess value for money, but the daily rate suggests a premium for specialized, immediate support.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded as a sole-source, 'not available for competition' action. This indicates that only one vendor, Korea Electric Power Corporation, was considered capable of fulfilling the requirement. The lack of competition means there was no opportunity for price discovery through a bidding process, potentially leading to a higher price than if multiple vendors had competed.

Taxpayer Impact: Taxpayers may have paid a premium due to the absence of competitive bidding, as the government did not leverage market forces to secure the best possible price.

Public Impact

The primary beneficiary is the Department of Defense, specifically the Army, ensuring continued operational capability. Services delivered include essential electric power distribution, vital for base operations. Geographic impact is localized to the specific military installation in Humphreys, Korea. Workforce implications are minimal for this specific task order, likely relying on existing personnel of the awarded contractor.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition limits price negotiation and potentially increases costs for taxpayers.
Sole-source award raises questions about the thoroughness of market research to identify potential competitors.
Short contract duration may indicate a reactive approach rather than proactive infrastructure planning.

Positive Signals

Ensures critical infrastructure (electric power) is maintained for military operations.
Award to an established entity (Korea Electric Power Corporation) suggests reliability for specialized services.
Specific task order addresses an immediate and defined need.

Sector Analysis

This contract falls within the Utilities and Energy sector, specifically focusing on electric power distribution for critical infrastructure. The market for specialized utility services at overseas military installations is often limited, with incumbent providers or entities with unique access and capabilities dominating. Comparable spending benchmarks are difficult to establish due to the unique geographic and operational context of military bases.

Small Business Impact

This contract does not appear to have a small business set-aside component. Given the sole-source nature and the likely specialized expertise required for utility provision at a military installation, subcontracting opportunities for small businesses are unlikely to be significant or mandated.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are tied to the terms of the firm-fixed-price delivery order, requiring the contractor to provide the specified services. Transparency is limited due to the sole-source nature, but contract award data is publicly available.

Related Government Programs

Base Operations Support Contracts
Utility Privatization Programs
Overseas Military Construction Projects

Risk Flags

Sole-source award
Lack of competition
Short contract duration

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $8.0 million to KOREA ELECTRIC POWER CORPORATION. FY26 TASK ORDER FOR ELECTRIC CP HUMPHREYS FROM 1 NOVEMBER 2025 TO 31 JANUARY 2026

Who is the contractor on this award?

The obligated recipient is KOREA ELECTRIC POWER CORPORATION.

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $8.0 million.

What is the period of performance?

Start: 2025-11-01. End: 2026-01-31.

What is the track record of Korea Electric Power Corporation in providing similar services to the U.S. military?

Korea Electric Power Corporation (KEPCO) is a major South Korean electric utility company. While KEPCO primarily serves domestic needs, it has a history of involvement in international projects and potentially has experience supporting U.S. military installations in South Korea through various agreements or contracts. Specific details on past performance directly with the U.S. Army for electric power distribution at Humphreys would require deeper investigation into historical contract databases and performance reviews. However, as a large, established utility provider, it is presumed to have the technical capability and infrastructure to manage such a requirement.

How does the daily cost of this contract compare to commercial utility rates or other military base utility contracts?

The daily cost of approximately $87,778 is difficult to benchmark directly against commercial rates or other military contracts without more specific service details and location context. Commercial utility rates vary significantly by region and consumption volume. Military base contracts often include additional security, resilience, and operational support requirements that can increase costs compared to civilian equivalents. Given the sole-source nature and the specific operational context of Humphreys, this rate likely reflects a premium for guaranteed availability and specialized support in a potentially unique operating environment.

What are the specific risks associated with a sole-source award for critical utility services?

The primary risk of a sole-source award for critical utility services is the potential for inflated pricing due to the lack of competition. Without competing bids, the government loses the opportunity to leverage market forces to secure the most cost-effective solution. Additionally, sole-source awards can sometimes indicate a lack of thorough market research or a reliance on a single provider, which could create long-term dependencies and limit future flexibility. Ensuring robust oversight and performance monitoring becomes even more critical in sole-source situations to mitigate these risks.

What is the expected impact of this 91-day contract on the overall operational effectiveness of the Humphreys installation?

This contract is a task order for electric power distribution, a fundamental utility. Its successful execution for the 91-day period is crucial for maintaining the operational effectiveness of the Humphreys installation. Reliable electric power underpins all base functions, from housing and administrative buildings to mission-critical systems and communication networks. The short duration suggests it's intended to cover a specific, immediate need, such as bridging a gap in existing services, supporting a temporary surge in demand, or addressing an unforeseen issue, thereby ensuring continuity of operations during that period.

What has been the historical spending pattern for electric power distribution at Humphreys or similar Army installations?

Historical spending patterns for electric power distribution at Humphreys or similar Army installations can vary widely based on factors like installation size, age of infrastructure, energy consumption levels, and the contracting approach (e.g., direct utility purchase, privatization, long-term service contracts). Short-term task orders like this one, especially when sole-source, are typically exceptions rather than the norm for ongoing utility provision. Analyzing historical data would require examining longer-term contracts, base operating support services, and potentially utility privatization agreements to understand the typical cost structure and procurement strategies employed.

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: 55 JEOLLYEOK-RO, NAJU

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $7,987,770

Exercised Options: $7,987,770

Current Obligation: $7,987,770

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W91QVN18D0008

IDV Type: IDC

Timeline