NOAA's $13.4M Electrical Services Contract with Public Service Company of Colorado Lacks Competition

Contract Overview

Contract Amount: $13,414,413 ($13.4M)

Contractor: Public Service Company of Colorado

Awarding Agency: Department of Commerce

Start Date: 2007-04-01

End Date: 2017-04-30

Contract Duration: 3,682 days

Daily Burn Rate: $3.6K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ELECTRICAL SERVICES

Place of Performance

Location: BOULDER, BOULDER County, COLORADO, 80305

State: Colorado Government Spending

Plain-Language Summary

Department of Commerce obligated $13.4 million to PUBLIC SERVICE COMPANY OF COLORADO for work described as: ELECTRICAL SERVICES Key points: 1. Significant spending on electrical services over a decade. 2. Sole-source award raises concerns about price discovery and value. 3. Long contract duration (10 years) may not reflect current market rates. 4. Lack of competition limits potential savings for taxpayers.

Value Assessment

Rating: questionable

The contract was awarded as a delivery order, and the total value is substantial. However, without competitive bidding, it's difficult to assess if the pricing is optimal or reflects fair market value compared to similar services.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was not available for competition, indicating a sole-source award. This method bypasses the competitive process, potentially leading to higher costs and reduced innovation as there is no market pressure to offer the best price.

Taxpayer Impact: The lack of competition likely results in higher costs for taxpayers, as the government may be paying a premium without the benefit of market-driven price reductions.

Public Impact

Taxpayers may be overpaying for essential electrical distribution services. Government agencies rely on consistent power, making service disruptions a critical concern. Long-term contracts without review can lead to outdated technology or service agreements.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Long contract duration
Sole-source award

Positive Signals

Essential service provision

Sector Analysis

This contract falls under utility services, specifically electric power distribution. Spending in this sector is generally stable but can vary based on infrastructure needs and energy market fluctuations. Benchmarks are difficult without competitive data.

Small Business Impact

The data does not indicate any involvement of small businesses in this contract. The award was made to a large utility provider, suggesting limited opportunities for small businesses in this specific procurement.

Oversight & Accountability

The sole-source nature of this award warrants scrutiny. Oversight should focus on ensuring the necessity of the sole-source justification and verifying that the pricing remains reasonable throughout the contract's extended duration.

Related Government Programs

Electric Power Distribution
Department of Commerce Contracting
National Oceanic and Atmospheric Administration Programs

Risk Flags

Lack of competition
Potential for overpricing
Long contract duration without clear price adjustment mechanisms
Limited oversight visibility due to sole-source nature

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $13.4 million to PUBLIC SERVICE COMPANY OF COLORADO. ELECTRICAL SERVICES

Who is the contractor on this award?

The obligated recipient is PUBLIC SERVICE COMPANY OF COLORADO.

Which agency awarded this contract?

Awarding agency: Department of Commerce (National Oceanic and Atmospheric Administration).

What is the total obligated amount?

The obligated amount is $13.4 million.

What is the period of performance?

Start: 2007-04-01. End: 2017-04-30.

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

The justification for a sole-source award typically involves situations where only one responsible source can provide the required supplies or services. This could be due to unique capabilities, proprietary technology, or urgent needs that preclude a competitive solicitation. Without specific documentation, the exact reason remains unclear, but it implies a lack of readily available alternatives.

How can the government ensure fair pricing for this sole-source contract over its 10-year duration?

To ensure fair pricing, the government should implement robust price analysis techniques, potentially using independent cost estimates or benchmarking against similar, competitively awarded contracts for comparable services. Regular reviews and potential renegotiations based on market shifts or cost reductions by the contractor are crucial. Including price adjustment clauses tied to objective market indicators can also help.

What is the potential impact of this long-term, non-competitive contract on future government procurement strategies for electrical services?

A long-term, non-competitive contract like this could discourage future competition if potential providers perceive the market as already captured. It might also signal a reliance on incumbent providers, potentially leading to complacency and missed opportunities for innovation and cost savings. Agencies should actively seek opportunities to introduce competition in subsequent procurements.

Industry Classification

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

Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Xcel Energy Inc. (UEI: 848381245)

Address: 1225 17TH ST 12TH FLOOR, DENVER, CO, 80202

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $13,414,413

Exercised Options: $13,414,413

Current Obligation: $13,414,413

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: GS00P06BSD0385

IDV Type: IDC

Timeline