Interior's $16.3M turbine modernization contract awarded to Andritz Hydro Corp for Anderson Ranch Dam

Contract Overview

Contract Amount: $16,347,038 ($16.3M)

Contractor: Andritz Hydro Corp

Awarding Agency: Department of the Interior

Start Date: 2023-06-12

End Date: 2027-07-04

Contract Duration: 1,483 days

Daily Burn Rate: $11.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Construction

Official Description: ANDERSON RANCH DAM TURBINE MODERNIZATION AND RUNNER REPLACEMENT.

Place of Performance

Location: MOUNTAIN HOME, ELMORE County, IDAHO, 83647

State: Idaho Government Spending

Plain-Language Summary

Department of the Interior obligated $16.3 million to ANDRITZ HYDRO CORP for work described as: ANDERSON RANCH DAM TURBINE MODERNIZATION AND RUNNER REPLACEMENT. Key points: 1. Value for money assessed against similar infrastructure upgrades. 2. Competition dynamics indicate a robust bidding process. 3. Risk indicators monitored for project timeline and budget adherence. 4. Performance context tied to critical dam infrastructure reliability. 5. Sector positioning within heavy civil engineering and energy infrastructure. 6. Contract type is firm fixed price, shifting risk to the contractor.

Value Assessment

Rating: good

The contract value of $16.3 million for turbine modernization and runner replacement at Anderson Ranch Dam appears reasonable when benchmarked against similar large-scale hydroelectric power infrastructure projects. While specific per-unit cost data for turbine runners is not publicly available, the overall price reflects the complexity and specialized nature of the work. The firm fixed-price structure suggests a degree of confidence in cost estimation by the Bureau of Reclamation and shifts significant cost overrun risk to the contractor, ANDRITZ HYDRO CORP.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple qualified vendors were likely solicited and submitted bids. The presence of three bids suggests a healthy level of interest and competition for this specialized work. A competitive bidding process generally leads to better price discovery and ensures that the government receives proposals from a range of capable contractors, potentially driving down costs and improving the quality of the final award.

Taxpayer Impact: Taxpayers benefit from a competitive process that aims to secure the best possible price and value for essential infrastructure upgrades, minimizing the risk of overpayment.

Public Impact

The primary beneficiaries are the Bureau of Reclamation and the surrounding region relying on the Anderson Ranch Dam for power generation and water management. Services delivered include the modernization of critical turbine components, enhancing operational efficiency and reliability. The geographic impact is localized to the Anderson Ranch Dam facility in Idaho. Workforce implications include specialized engineering and construction jobs during the project's execution.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for schedule delays in complex infrastructure projects.
Risk of unforeseen site conditions impacting cost or timeline.
Dependence on a single contractor for specialized turbine components.

Positive Signals

Firm fixed-price contract mitigates budget overruns for the government.
Full and open competition suggests a competitive market for this service.
Award to an established contractor (ANDRITZ HYDRO CORP) with relevant experience.

Sector Analysis

This contract falls within the heavy and civil engineering construction sector, specifically focusing on energy infrastructure and dam modernization. The market for hydroelectric turbine upgrades is specialized, often dominated by a few key manufacturers and service providers. The value of this contract is significant within its niche, reflecting the high cost of specialized equipment and installation for critical power generation assets. Comparable spending benchmarks would involve other large-scale dam rehabilitation or power plant upgrade projects.

Small Business Impact

There is no indication that this contract included small business set-asides, nor is there information suggesting significant subcontracting opportunities for small businesses. The specialized nature of turbine modernization and replacement typically requires highly specific expertise and certifications often held by larger, established firms. The impact on the small business ecosystem is likely minimal for this particular award.

Oversight & Accountability

Oversight for this contract will be managed by the Bureau of Reclamation, a division of the Department of the Interior. Accountability measures are embedded in the firm fixed-price contract terms, requiring the contractor to deliver specified outcomes within the agreed budget and timeline. Transparency is facilitated through federal contract databases, though detailed performance metrics may not be publicly disclosed. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

Bureau of Reclamation Dam Safety Program
Department of Energy Hydropower Modernization Initiatives
Army Corps of Engineers Civil Works Projects

Risk Flags

Potential for schedule slippage
Risk of cost overruns (borne by contractor)
Dependency on specialized contractor expertise
Integration challenges with existing infrastructure

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $16.3 million to ANDRITZ HYDRO CORP. ANDERSON RANCH DAM TURBINE MODERNIZATION AND RUNNER REPLACEMENT.

Who is the contractor on this award?

The obligated recipient is ANDRITZ HYDRO CORP.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Bureau of Reclamation).

What is the total obligated amount?

The obligated amount is $16.3 million.

What is the period of performance?

Start: 2023-06-12. End: 2027-07-04.

What is the track record of ANDRITZ HYDRO CORP in completing similar turbine modernization projects for federal agencies?

ANDRITZ HYDRO CORP is a global leader in the hydropower industry, with extensive experience in manufacturing, supplying, and servicing turbines and generators. They have a significant track record of undertaking large-scale modernization projects for both public and private sector clients worldwide. While specific details on past federal contracts of identical scope and value are not readily available in public databases, their portfolio includes numerous successful upgrades to existing hydropower facilities. Federal agencies often rely on established manufacturers like Andritz due to their specialized engineering capabilities, proprietary technology, and proven performance in complex environments. A review of their project history would likely reveal numerous instances of successful turbine runner replacements and modernization efforts that align with the requirements of the Anderson Ranch Dam project.

How does the awarded amount compare to the estimated cost or budget for this modernization project?

The awarded amount of $16,347,038 represents the final contract value. Without access to the Bureau of Reclamation's internal budget or cost estimates for the Anderson Ranch Dam turbine modernization, a direct comparison is not possible. However, the fact that the contract was awarded under full and open competition with three bidders suggests that the bids received were considered competitive and within a reasonable range of the government's expectations. In many large infrastructure projects, the awarded amount can be close to or slightly below initial estimates if competition is strong and the scope is well-defined. Conversely, if unforeseen issues arise during the project, the firm fixed-price nature means the contractor absorbs those additional costs, rather than the government paying more than the awarded amount.

What are the primary risks associated with modernizing aging turbine equipment at a federal dam?

Modernizing aging turbine equipment at federal dams presents several key risks. Firstly, there's the risk of unforeseen site conditions; dams are complex structures, and uncovering unexpected structural issues, debris, or geological challenges during excavation or disassembly can lead to significant delays and cost overruns, although the firm fixed-price contract shifts this risk to the contractor. Secondly, the integration of new components with existing, often decades-old, infrastructure can be technically challenging, requiring precise engineering and potentially leading to compatibility issues. Thirdly, there's the risk of supply chain disruptions for specialized parts, especially if components are custom-made or sourced internationally. Finally, operational risks include the potential for extended downtime of the dam's power generation capabilities during the modernization period, impacting energy supply and revenue, and the risk of performance not meeting expectations post-upgrade.

What is the expected impact of this modernization on the dam's power generation capacity and efficiency?

The modernization of turbine runners and associated equipment is expected to significantly improve the Anderson Ranch Dam's power generation capacity and overall efficiency. Newer runner designs typically incorporate advanced hydraulic principles, leading to better water flow management and increased energy capture from the same volume of water. This can translate to a higher megawatt output. Furthermore, modern components are often designed for greater reliability and reduced maintenance, leading to less downtime and more consistent power generation over the long term. While specific percentage increases in capacity or efficiency are project-dependent and would be detailed in the engineering specifications, the primary goal of such upgrades is to restore and enhance the generating potential of aging infrastructure, ensuring it operates closer to its original design specifications or even exceeds them.

How has federal spending on dam and hydropower infrastructure modernization evolved in recent years?

Federal spending on dam and hydropower infrastructure modernization has seen fluctuations but generally increased focus in recent years, driven by aging infrastructure needs and a push for renewable energy sources. Legislation like the Bipartisan Infrastructure Law has allocated significant funding towards upgrading critical infrastructure, including dams and hydropower facilities, to improve safety, reliability, and efficiency. Agencies like the Bureau of Reclamation and the Army Corps of Engineers manage vast portfolios of aging dams that require substantial investment for repair, rehabilitation, and modernization. This trend reflects a growing recognition of the importance of these facilities for water management, flood control, and clean energy generation, necessitating sustained federal investment to address deferred maintenance and incorporate modern technologies.

Industry Classification

NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction

Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: 140R1023R0001

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Andritz AG

Address: 10735 DAVID TAYLOR DR STE 500, CHARLOTTE, NC, 28262

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

Financial Breakdown

Contract Ceiling: $16,347,038

Exercised Options: $16,347,038

Current Obligation: $16,347,038

Actual Outlays: $1,016,106

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline