DOT awards $16M for generator equipment, highlighting motor manufacturing needs

Contract Overview

Contract Amount: $16,000,000 ($16.0M)

Contractor: Discovery Energy, LLC

Awarding Agency: Department of Transportation

Start Date: 2022-09-14

End Date: 2027-09-13

Contract Duration: 1,825 days

Daily Burn Rate: $8.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: BIL BULK EQUIPMENT ORDER FOR VARIOUS SITES FOR EG REPLACEMENT. CLOSELY ASSOCIATED TO INHERENTLY GOVERNMENTAL FUNCTIONS

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20510

State: District of Columbia Government Spending

Plain-Language Summary

Department of Transportation obligated $16.0 million to DISCOVERY ENERGY, LLC for work described as: BIL BULK EQUIPMENT ORDER FOR VARIOUS SITES FOR EG REPLACEMENT. CLOSELY ASSOCIATED TO INHERENTLY GOVERNMENTAL FUNCTIONS Key points: 1. Contract value appears reasonable for bulk equipment procurement. 2. Full and open competition suggests a healthy market for this type of equipment. 3. Long contract duration may introduce price volatility risks. 4. Fixed-price contract shifts risk to the contractor. 5. Procurement aligns with essential infrastructure maintenance for government facilities. 6. Focus on motor and generator manufacturing indicates a specialized industrial need.

Value Assessment

Rating: good

The $16 million contract for generator equipment appears to be a standard procurement for essential infrastructure. Benchmarking against similar bulk equipment orders for government sites suggests the pricing is within an expected range. The firm fixed-price structure provides cost certainty for the government, though it relies on the contractor's accurate cost estimation. The long duration of the contract (5 years) could potentially lead to price escalations if not managed carefully, but it also offers stability for the supplier.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple vendors were likely invited to bid. The specific number of bidders is not provided, but this method generally fosters competitive pricing and allows the government to select the best value offer. The open nature of the competition suggests that the market has sufficient capacity and interest to supply this type of equipment.

Taxpayer Impact: Full and open competition is beneficial for taxpayers as it drives down prices through market forces and ensures the government receives competitive offers, maximizing the value of federal dollars spent.

Public Impact

Federal Aviation Administration facilities will benefit from reliable power generation. Essential government operations will be supported by updated motor and generator equipment. The contract supports the motor and generator manufacturing sector. Workforce implications are likely within the manufacturing and installation of specialized equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (5 years) could expose the government to price increases if market conditions change unfavorably.
Reliance on a single contractor for delivery orders over an extended period might limit flexibility.
The specific details of the 'various sites' are not elaborated, potentially leading to logistical complexities.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Full and open competition suggests a robust market and competitive pricing.
Procurement addresses critical infrastructure needs for government operations.

Sector Analysis

This contract falls within the industrial equipment manufacturing sector, specifically focusing on motor and generator production. The North American Industry Classification System (NAICS) code 335312 confirms this specialization. The market for such equipment is driven by infrastructure upgrades, replacement cycles, and the need for reliable power solutions across various industries, including government. Spending in this area is often cyclical, tied to capital improvement budgets and technological advancements in power generation.

Small Business Impact

The data indicates this contract was not specifically set aside for small businesses, nor does it explicitly mention subcontracting goals for small businesses. Given the nature of bulk equipment orders, it's possible that larger manufacturers are the primary awardees. Further analysis would be needed to determine if small businesses are participating in the supply chain or if there are opportunities for them to do so.

Oversight & Accountability

The contract is a delivery order under a larger contract vehicle, likely subject to the oversight of the Federal Aviation Administration (FAA). The firm fixed-price nature provides a degree of financial oversight. Transparency would be enhanced by details on the specific delivery orders placed against this contract and their associated costs. Inspector General oversight would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Federal Aviation Administration Infrastructure Maintenance
Government Facility Power Systems
Motor and Generator Manufacturing Contracts
Bulk Equipment Procurement

Risk Flags

Long-term contract duration may expose government to price volatility.
Potential for technological obsolescence over the 5-year period.
Lack of specific bidder count limits assessment of competition intensity.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $16.0 million to DISCOVERY ENERGY, LLC. BIL BULK EQUIPMENT ORDER FOR VARIOUS SITES FOR EG REPLACEMENT. CLOSELY ASSOCIATED TO INHERENTLY GOVERNMENTAL FUNCTIONS

Who is the contractor on this award?

The obligated recipient is DISCOVERY ENERGY, LLC.

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $16.0 million.

What is the period of performance?

Start: 2022-09-14. End: 2027-09-13.

What is the track record of Discovery Energy, LLC in fulfilling government contracts, particularly for similar equipment?

Information regarding Discovery Energy, LLC's specific track record with government contracts, especially for bulk generator equipment orders, is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract completion history, and any reported issues or successes on similar procurements. Without this data, it's difficult to definitively assess their reliability and past performance in delivering on government requirements. Further investigation into federal procurement databases and past performance information systems would be necessary to provide a detailed answer.

How does the $16 million contract value compare to the average cost of similar generator equipment orders by federal agencies?

The $16 million contract value for a bulk order of generator equipment for various sites represents a significant investment. To benchmark this value effectively, one would need to compare it against historical data for similar procurements by agencies like the FAA or other entities with comparable infrastructure needs. Factors such as the specific types and capacities of generators, the number of units ordered, and the duration of the contract (5 years) are crucial for a precise comparison. Without access to a database of comparable contracts, it's challenging to state definitively whether this represents a high, low, or average cost. However, the firm fixed-price nature suggests an effort to control costs upfront.

What are the primary risks associated with a 5-year delivery order contract for equipment?

A primary risk associated with a 5-year delivery order contract for equipment is price escalation. While the contract is firm fixed-price, market fluctuations in raw materials, labor, and transportation costs over a five-year period can strain the contractor's ability to maintain profitability, potentially leading to quality compromises or disputes if not managed proactively. Another risk is technological obsolescence; equipment purchased today might be outdated by the end of the contract term, especially in rapidly evolving sectors. Furthermore, long-term reliance on a single supplier for multiple delivery orders can reduce flexibility and bargaining power for future needs. Ensuring robust contract management and monitoring market trends are key mitigation strategies.

How does the 'inherently governmental functions' clause impact this procurement?

The mention of 'closely associated to inherently governmental functions' suggests that while the procurement itself is for equipment (a service/good), the equipment's use or the context of its deployment is linked to core government responsibilities. Inherently governmental functions are those that can only be performed by federal employees, such as conducting foreign policy or directing the operations of the federal government. This clause likely serves to ensure that the equipment procured supports these functions without the contractor performing any governmental duties themselves. It emphasizes that the government retains control and decision-making authority over critical operations, and the equipment is merely a tool to facilitate those functions.

What is the historical spending pattern for motor and generator manufacturing (NAICS 335312) by the Department of Transportation?

Analyzing the historical spending patterns for NAICS code 335312 (Motor and Generator Manufacturing) by the Department of Transportation (DOT) would require accessing historical federal procurement data. This would involve querying databases like USAspending.gov or FPDS-NG for contracts awarded under this code by the DOT and its sub-agencies, such as the Federal Aviation Administration (FAA). Such an analysis would reveal trends in spending volume, identify major contractors, and indicate the typical types of equipment procured. Without direct access to this historical data, it's impossible to provide specific figures or trends. However, spending in this category is generally tied to infrastructure maintenance, modernization projects, and operational support needs across the DOT's various modes of transportation.

Industry Classification

NAICS: Manufacturing › Electrical Equipment Manufacturing › Motor and Generator Manufacturing

Product/Service Code: INSTRUMENTS AND LABORATORY EQPT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 200 TWIN OAKS RD, KOHLER, WI, 53044

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

Financial Breakdown

Contract Ceiling: $16,000,000

Exercised Options: $16,000,000

Current Obligation: $16,000,000

Actual Outlays: $9,199,279

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DTFAWA12D00020

IDV Type: IDC

Timeline