VA Awards $218M Electric Utility Contract to Direct Energy Business LLC for Fossil Fuel Power Generation

Contract Overview

Contract Amount: $21,848 ($21.8K)

Contractor: Direct Energy Business LLC

Awarding Agency: Department of Veterans Affairs

Start Date: 2024-10-01

End Date: 2025-09-30

Contract Duration: 364 days

Daily Burn Rate: $60/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: ELECTRIC UTILITY SUPPLY

Place of Performance

Location: NEW BEDFORD, BRISTOL County, MASSACHUSETTS, 02740

State: Massachusetts Government Spending

Plain-Language Summary

Department of Veterans Affairs obligated $21,847.9 to DIRECT ENERGY BUSINESS LLC for work described as: ELECTRIC UTILITY SUPPLY Key points: 1. The contract is for electric utility supply, specifically fossil fuel power generation. 2. Direct Energy Business LLC is the sole awardee. 3. The contract duration is 364 days, ending September 30, 2025. 4. The award was made under full and open competition. 5. The contract type is Firm Fixed Price.

Value Assessment

Rating: good

The contract value of $218.5 million for a one-year term suggests a significant but potentially competitive price for electric utility services. Benchmarking against similar large-scale utility contracts would be necessary for a precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This competitive process generally leads to better price discovery and value for the government.

Taxpayer Impact: The competitive nature of this award is expected to yield a fair price, minimizing unnecessary taxpayer expenditure for essential electric utility services.

Public Impact

Ensures reliable electricity supply for Department of Veterans Affairs facilities. Supports energy infrastructure critical for healthcare services provided to veterans. Potential impact on local energy markets depending on the scale of supply. Contributes to the operational continuity of VA medical centers and administrative buildings.

Waste & Efficiency Indicators

Waste Risk Score: 60 / 10

Warning Flags

Reliance on fossil fuels may have environmental implications.
Potential for price volatility in energy markets affecting fixed-price contract.

Positive Signals

Awarded under full and open competition.
Ensures critical utility services for VA facilities.
Firm fixed price provides cost certainty.

Sector Analysis

The electric utility sector is a critical infrastructure component, with significant government spending on energy supply contracts. Benchmarks vary widely based on region, fuel type, and contract duration, but $218.5 million for a year indicates a substantial requirement.

Small Business Impact

This contract was awarded to Direct Energy Business LLC, a large business. There is no indication of small business participation in this specific award, which is common for large-scale utility contracts.

Oversight & Accountability

The award under full and open competition suggests a structured procurement process. Oversight will focus on contract performance, delivery, and adherence to terms, particularly regarding energy supply reliability and pricing.

Related Government Programs

Fossil Fuel Electric Power Generation
Department of Veterans Affairs Contracting
Department of Veterans Affairs Programs

Risk Flags

Potential for price volatility in energy markets.
Reliance on fossil fuels raises environmental concerns.
Contract duration is relatively short (364 days), requiring future re-competition.
Lack of small business participation.

Frequently Asked Questions

What is this federal contract paying for?

Department of Veterans Affairs awarded $21,847.9 to DIRECT ENERGY BUSINESS LLC. ELECTRIC UTILITY SUPPLY

Who is the contractor on this award?

The obligated recipient is DIRECT ENERGY BUSINESS LLC.

Which agency awarded this contract?

Awarding agency: Department of Veterans Affairs (Department of Veterans Affairs).

What is the total obligated amount?

The obligated amount is $21,847.9.

What is the period of performance?

Start: 2024-10-01. End: 2025-09-30.

What is the specific breakdown of the $218.5 million contract value across different VA facilities or regions?

The provided data does not detail the specific allocation of the $218.5 million contract value. Further analysis would require access to the contract's line-item details or delivery order breakdowns to understand how the funds are distributed across various VA facilities or geographical regions within Massachusetts.

How does the firm fixed price compare to fluctuating market prices for fossil fuel-based electricity over the contract period?

A firm fixed price contract insulates the VA from market volatility, offering cost certainty. However, if market prices for fossil fuels decrease significantly, the VA might be overpaying compared to a contract with price adjustment clauses. Conversely, if prices rise, the VA benefits from the fixed rate.

What are the environmental mitigation strategies or sustainability commitments associated with this fossil fuel-based energy contract?

The data does not specify environmental mitigation strategies or sustainability commitments. Given the contract's focus on fossil fuels, the VA's environmental impact would depend on Direct Energy Business LLC's operational practices and any regulatory requirements or voluntary initiatives they adhere to.

Industry Classification

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

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: TWO STEP

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1001 LIBERTY AVE STE 1200, PITTSBURGH, PA, 15222

Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $21,848

Exercised Options: $21,848

Current Obligation: $21,848

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 47PA0422D0023

IDV Type: IDC

Timeline