DOJ's $540.7M electric power contract awarded to Constellation NewEnergy, Inc. for 364 days

Contract Overview

Contract Amount: $540,657 ($540.7K)

Contractor: Constellation Newenergy, Inc.

Awarding Agency: Department of Justice

Start Date: 2025-10-01

End Date: 2026-09-30

Contract Duration: 364 days

Daily Burn Rate: $1.5K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: ELECTRIC POWER SUPPLY

Place of Performance

Location: LEWIS RUN, MCKEAN County, PENNSYLVANIA, 16738

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Justice obligated $540,657.17 to CONSTELLATION NEWENERGY, INC. for work described as: ELECTRIC POWER SUPPLY Key points: 1. Value for money assessed against market rates for electric power. 2. Competition dynamics indicate a full and open process was utilized. 3. Risk indicators include contract duration and fixed-price nature. 4. Performance context is the ongoing need for electric power for federal facilities. 5. Sector positioning within the energy utilities market.

Value Assessment

Rating: good

The contract's total value of $540.7 million over approximately one year suggests a significant expenditure for electric power. Benchmarking this against national averages for commercial or industrial electricity rates, adjusted for bulk purchasing and federal facility energy demands, is crucial. While specific per-unit cost data is not provided, the firm fixed-price structure implies a predictable cost, though it may not capture potential savings from market fluctuations. The scale of the award suggests potential for favorable pricing due to volume.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. This process is designed to foster a competitive environment, theoretically leading to the best value for the government. The number of bidders is not specified, but the open competition suggests a robust process aimed at securing competitive pricing and terms.

Taxpayer Impact: A full and open competition generally benefits taxpayers by promoting price discovery and potentially lowering costs through multiple offers. This approach ensures that the government is not limited to a single provider, increasing the likelihood of obtaining services at a reasonable market price.

Public Impact

Federal facilities operated by the Bureau of Prisons will receive reliable electric power. The contract supports the operational continuity of correctional institutions. Geographic impact is concentrated in Pennsylvania, where the service is delivered. Workforce implications are primarily related to the contractor's operational and maintenance staff.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases if market conditions change significantly, despite fixed-price contract.
Dependence on a single large contractor for a critical utility service.
Ensuring consistent service delivery across all designated federal facilities.

Positive Signals

Awarded through full and open competition, suggesting competitive pricing.
Firm fixed-price contract provides cost certainty for the government.
Long-term relationship with a major energy provider can ensure reliability.

Sector Analysis

This contract falls within the energy utilities sector, specifically focusing on electric power supply. The market for electric power is typically characterized by regulated utilities and competitive wholesale markets. Federal agencies are significant consumers of electricity, and their procurement strategies often involve large-scale contracts to meet demand. Comparable spending benchmarks would involve analyzing other federal agency contracts for similar utility services or large commercial energy procurement agreements.

Small Business Impact

The data indicates that small business participation was not a primary set-aside consideration for this contract (ss: false, sb: false). While the primary awardee is a large corporation, the contract terms do not explicitly mention subcontracting goals for small businesses. Further analysis would be needed to determine if any subcontracting opportunities exist within the execution of this electric power supply agreement and their impact on the small business ecosystem.

Oversight & Accountability

Oversight for this contract would typically fall under the purview of the contracting agency, the Department of Justice, and specifically the Bureau of Prisons. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to service delivery. Transparency is generally maintained through federal procurement databases, though specific operational details may be sensitive. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Federal Energy Management Program
Utility Energy Services Contracts
Department of Justice Energy Procurement
Bureau of Prisons Facility Operations

Risk Flags

Contract Value
Contract Duration
Fixed-Price Structure

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $540,657.17 to CONSTELLATION NEWENERGY, INC.. ELECTRIC POWER SUPPLY

Who is the contractor on this award?

The obligated recipient is CONSTELLATION NEWENERGY, INC..

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 $540,657.17.

What is the period of performance?

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

What is the historical spending pattern for electric power by the Federal Prison System / Bureau of Prisons?

Analyzing historical spending for electric power by the Federal Prison System (FPS) or Bureau of Prisons (BOP) is crucial for context. While specific historical data for this exact contract is not provided, federal agencies typically have recurring needs for utilities. Examining past contract awards for electricity supply to BOP facilities, including their duration, value, and awardees, would reveal trends in spending. This could highlight whether this $540.7 million award represents an increase, decrease, or stable level of expenditure compared to previous periods. Understanding these patterns helps assess if current pricing is competitive over time and if there have been significant shifts in energy procurement strategies. For instance, a consistent rise in spending might indicate escalating energy prices or increased facility demands, while a stable pattern could suggest effective cost management or long-term price agreements.

How does the per-unit cost of electricity under this contract compare to market rates in Pennsylvania?

Determining the per-unit cost of electricity under this contract requires dividing the total award amount by the estimated kilowatt-hour (kWh) consumption over the contract period. Since the exact kWh usage is not provided, a precise comparison is difficult. However, we can benchmark against average commercial or industrial electricity rates in Pennsylvania. For example, if the contract value is $540.7 million for 364 days, and assuming a hypothetical energy consumption, we could derive a cents-per-kWh figure. This figure would then be compared to publicly available data from the U.S. Energy Information Administration (EIA) or state utility commissions for similar customer classes (e.g., large industrial or government facilities) in Pennsylvania. A lower per-unit cost would indicate favorable pricing, while a higher cost might warrant further investigation into the contract's justification, especially given the full and open competition.

What is Constellation NewEnergy, Inc.'s track record with federal government contracts, particularly for utility services?

Constellation NewEnergy, Inc. is a significant player in the energy market and likely holds numerous federal contracts. A review of federal procurement databases (like FPDS or SAM.gov) would reveal their history of awards, including contract types, values, agencies served, and performance ratings. Specifically, examining their past performance on electric power supply contracts for agencies like the Department of Justice or other federal entities would provide insight into their reliability, pricing competitiveness, and ability to meet government requirements. Positive past performance indicators, such as consistent on-time delivery, adherence to specifications, and favorable past performance reviews, would support the current award. Conversely, any history of disputes, contract terminations, or performance issues would raise concerns about the risk associated with this new award.

What are the potential risks associated with a firm fixed-price contract for electric power over a 364-day period?

A firm fixed-price (FFP) contract for electric power over 364 days offers cost certainty to the government, meaning the price is set and unlikely to change. However, risks exist. If market electricity prices were to fall significantly below the contracted rate during the term, the government would be overpaying relative to current market conditions. Conversely, if prices were to spike dramatically, the contractor bears the risk of reduced profit margins or potential financial strain, which could indirectly impact service reliability if the contractor struggles. For a utility service like electricity, the primary risk is ensuring uninterrupted supply. While FFP contracts incentivize the contractor to manage costs efficiently, the government must ensure the contractor has robust operational capabilities and contingency plans to prevent service disruptions, regardless of market fluctuations.

How does the scale of this $540.7 million award compare to overall federal spending on energy and utilities?

The $540.7 million award for electric power supply represents a substantial single contract. To contextualize its scale, it should be compared against the total federal budget allocated to energy and utilities procurement across all agencies. Data from the Office of Management and Budget (OMB) or reports from agencies like the General Services Administration (GSA) on federal energy consumption and spending can provide benchmarks. For instance, if total federal spending on electricity is in the billions annually, this single contract, while large, might represent a specific region or a significant portion of one agency's needs. Understanding this relative scale helps assess the government's overall investment in energy and whether this contract aligns with broader energy management strategies and spending priorities.

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

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Exelon Corporation

Address: 1310 POINT ST FL 8, BALTIMORE, MD, 21231

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

Financial Breakdown

Contract Ceiling: $540,657

Exercised Options: $540,657

Current Obligation: $540,657

Actual Outlays: $212,625

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PA0825D0001

IDV Type: IDC

Timeline