NASA awards $4.2M natural gas contract to Sage Energy Trading LLC for Johnson Space Center facilities
Contract Overview
Contract Amount: $4,208,495 ($4.2M)
Contractor: Sage Energy Trading LLC
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2025-11-01
End Date: 2028-10-31
Contract Duration: 1,095 days
Daily Burn Rate: $3.8K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: NATURAL GAS (UTILITIES) SUPPLY AND RELATED DELIVERY SERVICES FOR NASA JOHNSON SPACE CENTER (JSC), ELLINGTON FIELD (EF) AND SONNY CARTER TRAINING FACILITY (SCTF).
Place of Performance
Location: HOUSTON, HARRIS County, TEXAS, 77058
State: Texas Government Spending
Plain-Language Summary
National Aeronautics and Space Administration obligated $4.2 million to SAGE ENERGY TRADING LLC for work described as: NATURAL GAS (UTILITIES) SUPPLY AND RELATED DELIVERY SERVICES FOR NASA JOHNSON SPACE CENTER (JSC), ELLINGTON FIELD (EF) AND SONNY CARTER TRAINING FACILITY (SCTF). Key points: 1. Contract value represents a significant portion of NASA's utility spending for the specified facilities. 2. Full and open competition suggests a potentially competitive bidding process, which can drive favorable pricing. 3. The firm-fixed-price structure shifts cost risk to the contractor, providing budget certainty for NASA. 4. Contract duration of three years allows for stable energy supply but requires monitoring for price fluctuations. 5. Geographic concentration in Texas highlights regional energy market dynamics. 6. The award to a single entity for this specific service indicates a specialized market segment.
Value Assessment
Rating: good
The contract value of approximately $4.2 million over three years for natural gas supply is within a reasonable range for a federal facility of NASA Johnson Space Center's size and operational needs. Benchmarking against similar utility contracts for large government installations suggests that the pricing is likely competitive, especially given the full and open competition. The firm-fixed-price (FFP) contract type provides NASA with cost certainty, mitigating the risk of price volatility in the natural gas market. However, a detailed cost breakdown and comparison to current market indices would be necessary for a more precise value assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The specific number of bidders is not provided, but the designation suggests a robust competitive environment. A higher number of bidders typically leads to more competitive pricing and better terms for the government. The open competition process is designed to ensure that the government receives the best value by leveraging market forces.
Taxpayer Impact: Taxpayers benefit from the potential for lower prices and better service quality due to the competitive nature of the bidding process. Full and open competition aims to prevent inflated costs and ensure that federal funds are used efficiently.
Public Impact
NASA's Johnson Space Center, Ellington Field, and Sonny Carter Training Facility will receive a consistent and reliable supply of natural gas. This ensures the uninterrupted operation of critical facilities, including research labs, training centers, and administrative buildings. The contract supports energy infrastructure in the Houston metropolitan area, Texas. While not directly creating new jobs, the contract sustains the operational capacity of existing roles at NASA facilities reliant on natural gas.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for price escalation if market conditions change significantly and the fixed price becomes disadvantageous.
- Dependence on a single supplier for a critical utility could pose a risk if the supplier faces operational issues.
- Limited transparency on the specific breakdown of costs within the fixed-price contract.
Positive Signals
- Firm-fixed-price structure provides budget certainty and shifts cost overrun risk to the contractor.
- Full and open competition suggests a potentially competitive pricing environment.
- Contract duration allows for stable energy supply planning.
- Awarding to a specialized energy trading company may indicate access to favorable market rates.
Sector Analysis
The energy sector, specifically natural gas distribution and trading, is a critical component of federal infrastructure support. Federal agencies are significant consumers of utilities, including natural gas, for heating, power generation, and specialized processes. The market for natural gas is influenced by global supply, demand, geopolitical factors, and regulatory environments. Contracts like this, often awarded through competitive bidding, reflect the government's strategy to secure essential resources at optimal value. Comparable spending benchmarks for utilities at large federal installations can vary widely based on location, facility size, and specific energy needs.
Small Business Impact
This contract was awarded under full and open competition and does not indicate any specific small business set-aside provisions. The prime contractor, SAGE ENERGY TRADING LLC, is not identified as a small business in the provided data. There is no explicit information regarding subcontracting plans for small businesses. Therefore, the direct impact on the small business ecosystem appears minimal unless the prime contractor voluntarily engages small businesses for support services.
Oversight & Accountability
The contract is subject to oversight by the National Aeronautics and Space Administration (NASA) and its Office of Inspector General (OIG). NASA's procurement regulations and contract management policies will govern performance monitoring and compliance. The firm-fixed-price nature of the contract simplifies some aspects of financial oversight by providing a set cost, but performance metrics related to delivery and reliability will still require diligent monitoring. Transparency is generally maintained through contract award databases and reporting requirements.
Related Government Programs
- NASA Facilities Maintenance Contracts
- Federal Utility Services
- Natural Gas Procurement
- Energy Supply Contracts
- Johnson Space Center Operations
Risk Flags
- Potential for price volatility in the natural gas market
- Contractor performance risk
- Supply chain disruptions impacting natural gas delivery
Tags
energy, natural-gas, utilities, nasa, johnson-space-center, texas, firm-fixed-price, full-and-open-competition, delivery-order, medium-value
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $4.2 million to SAGE ENERGY TRADING LLC. NATURAL GAS (UTILITIES) SUPPLY AND RELATED DELIVERY SERVICES FOR NASA JOHNSON SPACE CENTER (JSC), ELLINGTON FIELD (EF) AND SONNY CARTER TRAINING FACILITY (SCTF).
Who is the contractor on this award?
The obligated recipient is SAGE ENERGY TRADING LLC.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $4.2 million.
What is the period of performance?
Start: 2025-11-01. End: 2028-10-31.
What is the track record of SAGE ENERGY TRADING LLC in performing similar federal contracts?
Information regarding the specific track record of SAGE ENERGY TRADING LLC in performing similar federal contracts is not detailed in the provided data. A comprehensive assessment would require reviewing past performance evaluations, contract history, and any reported issues or successes with previous government awards. Federal procurement systems often maintain performance records that can indicate a contractor's reliability, quality of service, and adherence to contract terms. Without this specific data, it is difficult to definitively assess their past performance in delivering natural gas supply and related services to federal entities.
How does the awarded price compare to market rates for natural gas in Texas during the contract period?
The provided data does not include the specific price per unit or a detailed cost breakdown, making a direct comparison to market rates challenging. However, the contract is a firm-fixed-price award resulting from full and open competition. This suggests that the pricing was deemed competitive at the time of award. To perform a thorough benchmark, one would need to compare the contract's effective unit price (if calculable from total award and estimated volume) against prevailing natural gas indices (e.g., Henry Hub) and regional price differentials in Texas during the relevant period. The three-year duration also implies a strategy to hedge against potential market volatility.
What are the primary risks associated with this natural gas supply contract for NASA?
The primary risks associated with this natural gas supply contract include potential price volatility if market conditions shift unfavorably against the fixed-price agreement, although the FFP structure mitigates this for NASA by capping their cost. Another risk is the contractor's ability to maintain consistent supply and delivery, especially during periods of high demand or potential disruptions in the natural gas infrastructure. Dependence on a single supplier, even if competitively selected, introduces a risk if the contractor experiences financial instability or operational failures. Ensuring compliance with all environmental and safety regulations related to natural gas distribution is also a critical risk area that requires ongoing monitoring.
How effective is the firm-fixed-price (FFP) contract type in managing costs for NASA in this scenario?
The firm-fixed-price (FFP) contract type is generally considered highly effective for managing costs in scenarios like this where the scope of work is well-defined and the risks of cost escalation are significant, such as in fluctuating commodity markets like natural gas. For NASA, the FFP structure provides budget certainty, as the price is fixed regardless of the contractor's actual costs. This shifts the risk of cost overruns entirely to the contractor, SAGE ENERGY TRADING LLC. While this protects NASA from unexpected price increases, it may mean that NASA potentially pays a premium compared to a cost-reimbursement contract if market prices were to decrease significantly. However, for essential utilities, cost certainty is often prioritized.
What is the historical spending pattern for natural gas at NASA Johnson Space Center?
The provided data does not include historical spending patterns for natural gas at NASA Johnson Space Center. To analyze this, one would need to access historical contract awards and expenditure data for utility services at JSC over previous fiscal years. This would involve identifying previous contracts for natural gas supply, their values, durations, and the contractors involved. Comparing current spending ($4.2M over 3 years) with historical data would reveal trends in pricing, consumption volumes, and the stability of the energy market for the facility. It would also help determine if this award represents an increase, decrease, or stable level of expenditure.
What are the implications of the contract duration (1095 days) on energy market risk for NASA?
The contract duration of 1095 days (three years) represents a medium-term commitment for NASA's natural gas supply. This duration allows for a degree of price stability and simplifies procurement planning compared to shorter-term contracts. However, it also exposes NASA to potential market risks if natural gas prices experience significant and sustained increases during the contract period. Conversely, if prices were to fall substantially, NASA would be locked into the higher fixed price. The decision to award for three years suggests a balance between securing stable supply and managing exposure to market volatility over that timeframe.
Industry Classification
NAICS: Utilities › Natural Gas Distribution › Natural Gas 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
Address: 4612 S VICTOR AVE, TULSA, OK, 74105
Business Categories: Category Business, HUBZone Firm, Limited Liability Corporation, Partnership or Limited Liability Partnership, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business, Women Owned Small Business
Financial Breakdown
Contract Ceiling: $18,501,142
Exercised Options: $18,501,142
Current Obligation: $4,208,495
Actual Outlays: $798,479
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 47PA0825D0036
IDV Type: IDC
Timeline
Start Date: 2025-11-01
Current End Date: 2028-10-31
Potential End Date: 2028-10-31 00:00:00
Last Modified: 2026-03-09
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