Justice Department awards $520K for electric power, raising questions about competition and value

Contract Overview

Contract Amount: $520,157 ($520.2K)

Contractor: Monongahela Power Company

Awarding Agency: Department of Justice

Start Date: 2025-10-01

End Date: 2026-09-30

Contract Duration: 364 days

Daily Burn Rate: $1.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: FY26 P4 MONPOWER ELECTRIC GC UTILITY ACCOUNT #110 088 889 198 CONTRACT # 47PA0418D0034

Place of Performance

Location: FAIRMONT, MARION County, WEST VIRGINIA, 26554

State: West Virginia Government Spending

Plain-Language Summary

Department of Justice obligated $520,156.6 to MONONGAHELA POWER COMPANY for work described as: FY26 P4 MONPOWER ELECTRIC GC UTILITY ACCOUNT #110 088 889 198 CONTRACT # 47PA0418D0034 Key points: 1. Contract awarded on a non-competitive basis, limiting price discovery. 2. Limited competition may lead to higher costs for taxpayers. 3. Performance period is one year, suggesting a short-term need. 4. Fixed-price contract type shifts risk to the contractor. 5. Geographic focus on West Virginia for electric utility services. 6. No indication of small business participation or set-asides.

Value Assessment

Rating: fair

The contract value of $520,156.60 for electric power services appears reasonable for a one-year duration, especially considering it's for a federal facility. However, without competitive bidding, it's difficult to benchmark against market rates or determine if it represents the best value. The fixed-price nature of the contract is positive, as it caps the government's financial exposure. Further analysis would require comparing this rate to similar utility contracts for federal facilities in West Virginia.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded under a sole-source justification, meaning it was not openly competed. This approach is typically used when only one vendor can provide the required goods or services. The lack of competition means there were no other bidders to compare against, potentially impacting the government's ability to secure the most favorable pricing. The justification for this sole-source award needs to be thoroughly reviewed to ensure it was appropriate.

Taxpayer Impact: Sole-source awards can result in higher costs for taxpayers as there is no competitive pressure to drive down prices. This limits the government's leverage in price negotiations.

Public Impact

Federal Prison System in West Virginia benefits from reliable electric power. Ensures continuous operation of critical infrastructure within the correctional facility. Supports the daily functions and security of the Bureau of Prisons. Impacts the operational budget of the Federal Prison System.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competitive bidding may result in suboptimal pricing.
Sole-source award raises concerns about the necessity and justification.
Limited transparency into the selection process and vendor qualifications.

Positive Signals

Fixed-price contract type provides cost certainty for the government.
Contract duration is clearly defined, allowing for predictable budgeting.
Awarded to Monongahela Power Company, likely an established utility provider.

Sector Analysis

The energy sector, particularly electric power generation and distribution, is a critical component of government operations. Federal agencies rely on stable and affordable energy to maintain facilities and execute missions. This contract falls within the utility services sub-sector. While specific market size data for federal prison utility contracts is not readily available, the overall U.S. electric power industry is vast, with significant spending by both public and private entities. Benchmarking would typically involve comparing rates with other utility providers or similar government contracts in the region.

Small Business Impact

There is no indication that this contract included any small business set-asides or subcontracting requirements. The award was made to Monongahela Power Company, which is likely a large utility provider. This suggests that small businesses were not directly involved in fulfilling this specific contract, and there may be missed opportunities for their participation in government contracting.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Justice's Federal Prison System. Accountability measures would be tied to the terms and conditions of the firm fixed-price contract, ensuring delivery of electric power as specified. Transparency is limited due to the sole-source nature of the award. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Prison System Operations
Bureau of Prisons Facilities Management
Utility Services Contracts
Department of Justice Procurement

Risk Flags

Sole-source award lacks competitive justification.
Potential for overpayment due to lack of competition.
No clear performance metrics outlined in summary data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $520,156.6 to MONONGAHELA POWER COMPANY. FY26 P4 MONPOWER ELECTRIC GC UTILITY ACCOUNT #110 088 889 198 CONTRACT # 47PA0418D0034

Who is the contractor on this award?

The obligated recipient is MONONGAHELA POWER COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Justice (Federal Prison System / Bureau of Prisons).

What is the total obligated amount?

The obligated amount is $520,156.6.

What is the period of performance?

Start: 2025-10-01. End: 2026-09-30.

What is the justification for awarding this electric power contract on a sole-source basis to Monongahela Power Company?

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which typically signifies a sole-source justification. Common reasons for sole-source awards include unique capabilities of a single provider, urgent and compelling needs where competition is impractical, or when only one responsible source exists. For electric utilities, this could be due to the provider being the sole entity capable of supplying power to a specific federal facility's location. A detailed review of the specific justification document filed by the Department of Justice would be necessary to understand the precise rationale and ensure it aligns with federal procurement regulations. Without this, it's difficult to assess if alternative solutions or competitive approaches were truly unavailable.

How does the awarded price compare to market rates for similar electric utility services in West Virginia?

Benchmarking the awarded price of $520,156.60 for one year of electric power against market rates in West Virginia is challenging without more specific data points. Key factors influencing utility pricing include the volume of electricity consumed, peak demand charges, transmission and distribution fees, and any specific service level agreements. Since this is a sole-source award, direct comparison to competitive bids is impossible. To assess value, one would need to compare the per-kilowatt-hour rate or the total cost against average commercial or industrial rates for similar consumption levels in the same geographic region, as well as against other federal contracts for utility services in comparable facilities. The fixed-price nature offers some cost certainty, but the absence of competition prevents a definitive value assessment.

What are the potential risks associated with a sole-source award for essential services like electric power?

Sole-source awards for essential services like electric power carry several potential risks. Primarily, the lack of competition can lead to inflated prices, as the contractor faces no pressure to offer the most cost-effective solution. This can result in higher expenditures for taxpayers. Secondly, it limits the government's ability to explore innovative solutions or alternative providers that might offer better service or technology. There's also a risk of complacency from the awarded contractor, potentially leading to reduced service quality over time, as they are not actively competing for future business. Furthermore, sole-source awards can raise concerns about fairness and transparency in the procurement process, potentially leading to scrutiny if the justification is not robust.

What is the historical spending pattern for electric power at this specific Federal Prison System facility?

The provided data does not include historical spending patterns for electric power at this specific Federal Prison System facility. To analyze historical spending, one would need access to previous contract awards or budget allocations for utility services at this location. Understanding past expenditures would allow for a comparison to the current award, identifying trends in cost increases or decreases, and assessing the consistency of service providers. Without this historical context, it is difficult to determine if the current $520,156.60 award represents an escalation, a reduction, or a stable cost compared to previous years. Such analysis is crucial for effective budget management and identifying potential anomalies.

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

The provided data does not specify any performance metrics or service level agreements (SLAs) associated with this contract. While the contract type is 'FIRM FIXED PRICE,' which defines the payment structure, it doesn't inherently detail the quality or reliability standards expected from Monongahela Power Company. Essential services like electricity typically require robust SLAs to ensure consistent power delivery, uptime, and response times in case of outages. The absence of explicit performance metrics in the summary data makes it difficult to assess how the contractor's performance will be monitored and evaluated. A review of the full contract document would be necessary to ascertain the presence and details of any such agreements.

Industry Classification

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

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: 1310 FAIRMONT AVE, FAIRMONT, WV, 26554

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

Financial Breakdown

Contract Ceiling: $520,157

Exercised Options: $520,157

Current Obligation: $520,157

Actual Outlays: $210,097

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PA0418D0034

IDV Type: IDC

Timeline