DOJ's $81.8M contract for Brooklyn prison energy services awarded to National Grid USA Service Company, Inc

Contract Overview

Contract Amount: $81,782,584 ($81.8M)

Contractor: National Grid USA Service Company, Inc.

Awarding Agency: Department of Justice

Start Date: 2016-05-05

End Date: 2020-03-06

Contract Duration: 1,401 days

Daily Burn Rate: $58.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: IGF::OT::IGF MDC BROOKLYN UESC PROJECT

Place of Performance

Location: FORT DIX, BURLINGTON County, NEW JERSEY, 08640

State: New Jersey Government Spending

Plain-Language Summary

Department of Justice obligated $81.8 million to NATIONAL GRID USA SERVICE COMPANY, INC. for work described as: IGF::OT::IGF MDC BROOKLYN UESC PROJECT Key points: 1. Contract awarded via a non-competitive process, raising questions about potential cost savings from open bidding. 2. The contract duration of 1401 days suggests a long-term commitment to energy infrastructure upgrades. 3. Focus on fossil fuel electric power generation indicates a significant environmental footprint and potential for renewable energy transition. 4. The firm-fixed-price structure shifts cost overrun risks to the contractor. 5. Awarded by the Federal Prison System, the project likely aims to improve operational efficiency and reduce energy costs within correctional facilities. 6. The contract's value is substantial, warranting scrutiny for value for money and performance. 7. Geographic focus on New Jersey suggests a specific facility or set of facilities requiring these energy services.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without more detailed cost breakdowns or comparisons to similar energy infrastructure projects for federal facilities. The $81.8 million award over approximately 3.8 years represents a significant investment. While a firm-fixed-price contract can offer cost certainty, the lack of competitive bidding means it's difficult to assess if the pricing reflects market rates or if taxpayers received the best possible value. Further analysis would require understanding the specific scope of work and comparing it to industry standards for energy generation and efficiency upgrades in similar institutional settings.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded using a sole-source justification, meaning it was not competed openly. This approach is typically used when only one responsible source is available or capable of meeting the requirement. The lack of competition means there was no opportunity for multiple vendors to bid, potentially limiting price discovery and the government's ability to secure the most cost-effective solution. The rationale for this sole-source award would need to be thoroughly documented to ensure it was justified.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the government does not benefit from the price reductions typically driven by competitive bidding. This limits the government's leverage in negotiating favorable terms and pricing.

Public Impact

The primary beneficiaries are the Federal Prison System and the Bureau of Prisons, which will receive upgraded energy infrastructure. Services delivered include the generation of electric power from fossil fuels, likely aimed at ensuring reliable and efficient operations. The geographic impact is concentrated in New Jersey, where the specific federal facility or facilities are located. Workforce implications may include the need for specialized technicians for installation, maintenance, and operation of the new energy systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may have resulted in a higher price than could have been achieved through an open bidding process.
The reliance on fossil fuels raises environmental concerns and may not align with long-term sustainability goals.
The sole-source nature of the award requires strong justification to ensure public funds are used efficiently.
The contract duration is substantial, making it critical to ensure the chosen solution remains optimal throughout its term.

Positive Signals

The firm-fixed-price contract provides cost certainty for the government, transferring the risk of cost overruns to the contractor.
The project addresses critical infrastructure needs for federal correctional facilities, ensuring operational continuity.
The award to a known entity like National Grid may indicate a reliance on established expertise for complex energy projects.

Sector Analysis

The energy sector, particularly within government facilities, is a critical area for operational efficiency and cost management. This contract falls under the broader category of utility services and infrastructure upgrades. The market for such services is often characterized by large, established utility providers and specialized energy service companies. Federal spending in this area is significant, driven by the need to maintain aging infrastructure, improve energy efficiency, and meet evolving environmental standards. Comparable benchmarks would involve analyzing other large-scale energy infrastructure contracts awarded to utilities or ESCOs for federal buildings or campuses.

Small Business Impact

There is no indication that this contract included a small business set-aside. Given the nature of the award (sole-source) and the likely scale of the project, it is improbable that small businesses were directly involved as prime contractors. Subcontracting opportunities for small businesses may exist, but these would depend on the prime contractor's procurement practices and the specific components or services required. The impact on the small business ecosystem is likely minimal unless significant subcontracting opportunities are generated.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Justice's Federal Prison System and Bureau of Prisons. Accountability measures would be embedded in the contract terms, including performance standards, delivery schedules, and payment milestones. Transparency is limited due to the sole-source nature of the award, making public scrutiny of the procurement process more challenging. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse related to the contract.

Related Government Programs

Federal Energy Management Program (FEMP)
Energy Savings Performance Contracts (ESPCs)
Utility Energy Services Contracts (UESCs)
Department of Justice Facilities Management
Bureau of Prisons Capital Investments

Risk Flags

Sole-source award lacks competitive justification.
Potential for overpayment due to lack of competition.
Reliance on fossil fuels may not align with sustainability goals.
Contract duration is long, requiring sustained performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of Justice awarded $81.8 million to NATIONAL GRID USA SERVICE COMPANY, INC.. IGF::OT::IGF MDC BROOKLYN UESC PROJECT

Who is the contractor on this award?

The obligated recipient is NATIONAL GRID USA SERVICE COMPANY, 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 $81.8 million.

What is the period of performance?

Start: 2016-05-05. End: 2020-03-06.

What was the specific justification for awarding this contract on a sole-source basis?

The provided data indicates the contract was awarded as 'NOT AVAILABLE FOR COMPETITION,' which is synonymous with a sole-source award. The specific justification for this determination is not detailed in the provided data. Typically, sole-source justifications are based on factors such as the existence of only one responsible source, urgent and compelling needs that preclude full and open competition, or specific statutory authority. Without further documentation from the Department of Justice, the precise reasons for bypassing competitive bidding remain unknown. This lack of transparency is a key area for further inquiry, as competitive processes are generally preferred to ensure the best value for taxpayer dollars.

How does the $81.8 million contract value compare to similar energy infrastructure projects for federal correctional facilities?

Direct comparison of the $81.8 million contract value to similar projects is difficult without more specific data on the scope of work, the types of energy generation involved (e.g., specific fossil fuel, capacity), and the duration of comparable projects. However, $81.8 million over approximately 3.8 years represents a substantial investment in energy infrastructure. For context, large-scale energy projects for federal facilities can range from tens of millions to hundreds of millions of dollars, depending on the size of the facility, the complexity of the upgrade, and the technologies employed. The firm-fixed-price nature suggests a defined scope, but the lack of competition makes it hard to ascertain if this price is competitive. Benchmarking would ideally involve analyzing other UESCs or similar contracts awarded by the Bureau of Prisons or other agencies for comparable facility types.

What are the primary risks associated with a sole-source contract of this magnitude?

The primary risks associated with a sole-source contract of this magnitude include potential overpayment, lack of innovation, and reduced accountability. Without competition, the government may pay a premium for the goods or services, as the contractor faces less pressure to offer the lowest possible price. The absence of multiple bidders can also stifle innovation, as the government is limited to the solutions proposed by the single source. Furthermore, accountability can be weakened; while performance metrics exist, the leverage the government has to enforce them is diminished compared to a competitive scenario where a contractor might be eager to secure future work. Ensuring robust oversight and clear performance standards is crucial to mitigate these risks.

What is the expected impact of this contract on the energy efficiency and environmental footprint of the targeted federal facilities?

The provided data indicates the contract is for 'Fossil Fuel Electric Power Generation,' which suggests an upgrade or provision of energy infrastructure rather than a direct focus on energy efficiency improvements or a shift to renewables. Therefore, the immediate impact on energy efficiency might be neutral or dependent on the efficiency of the new fossil fuel generation relative to the old system. The environmental footprint is likely to remain significant due to continued reliance on fossil fuels, unless the project involves advanced emission control technologies. A more detailed understanding of the project's scope is needed to assess specific efficiency gains or environmental mitigation efforts. Future contracts might focus on renewable energy integration or further efficiency upgrades.

What is the track record of National Grid USA Service Company, Inc. in performing similar federal energy contracts?

National Grid USA Service Company, Inc. is a major utility provider with extensive experience in energy infrastructure, distribution, and services. While their primary operations are often in regulated utility markets, they do engage in large-scale projects. Information on their specific track record with federal energy contracts, particularly sole-source awards of this size and nature, would require a deeper dive into federal procurement databases (like FPDS-NG) and potentially agency performance reviews. Assessing their past performance on similar projects, including adherence to schedules, budget, and quality standards, is crucial for understanding their capability and reliability in fulfilling this $81.8 million contract.

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: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: National Grid PLC (UEI: 220285972)

Address: 40 SYLVAN RD, WALTHAM, MA, 02451

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

Financial Breakdown

Contract Ceiling: $81,782,584

Exercised Options: $81,782,584

Current Obligation: $81,782,584

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P12BSD0879

IDV Type: IDC

Timeline