HUD awards $17.4M for electricity services to PEPCO, spanning nearly 9 years
Contract Overview
Contract Amount: $17,416,719 ($17.4M)
Contractor: Potomac Electric Power CO
Awarding Agency: Department of Housing and Urban Development
Start Date: 2000-05-25
End Date: 2008-09-26
Contract Duration: 3,046 days
Daily Burn Rate: $5.7K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: PEPCO - ELECTRICITY SERVICES FOR HQ
Place of Performance
Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20410
Plain-Language Summary
Department of Housing and Urban Development obligated $17.4 million to POTOMAC ELECTRIC POWER CO for work described as: PEPCO - ELECTRICITY SERVICES FOR HQ Key points: 1. Significant long-term contract value of $17.4 million. 2. Sole-source award to PEPCO indicates limited competition. 3. Contract duration of over 8 years presents potential for price escalation risks. 4. Spending falls within the Utilities sector.
Value Assessment
Rating: fair
The contract value of $17.4 million over 3046 days averages to approximately $5,718 per day. Benchmarking this against similar government electricity service contracts is difficult without more specific usage data, but the long duration suggests potential for price changes.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, meaning competition was not sought. This limits price discovery and may result in higher costs for taxpayers compared to a competitive procurement.
Taxpayer Impact: The lack of competition for this long-term electricity service contract may lead to higher costs for taxpayers over the contract's duration.
Public Impact
Ensures continuous electricity supply for HUD headquarters. Supports critical government operations through essential utility services. Long-term commitment to a single provider impacts market dynamics for similar services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition.
- Long contract duration (over 8 years) increases price risk.
- Lack of specific usage data hinders per-unit cost analysis.
Positive Signals
- Ensures reliable electricity for essential government functions.
- Single, stable provider for critical infrastructure.
Sector Analysis
This contract falls under the Utilities sector, specifically electricity services. Government spending on utilities is a consistent expenditure, but long-term sole-source contracts can be less cost-effective than competitive bids.
Small Business Impact
The data does not indicate any specific provisions or considerations for small businesses in this sole-source award to a large utility provider.
Oversight & Accountability
The sole-source nature of this award warrants scrutiny to ensure the pricing is fair and reasonable, especially given the extended contract term. Further review of the justification for sole-sourcing would be beneficial.
Related Government Programs
- Record Production
- Department of Housing and Urban Development Contracting
- Department of Housing and Urban Development Programs
Risk Flags
- Sole-source award
- Long contract duration
- Lack of competition
- Potential for above-market pricing
- Limited transparency on justification
Tags
record-production, department-of-housing-and-urban-developm, dc, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Housing and Urban Development awarded $17.4 million to POTOMAC ELECTRIC POWER CO. PEPCO - ELECTRICITY SERVICES FOR HQ
Who is the contractor on this award?
The obligated recipient is POTOMAC ELECTRIC POWER CO.
Which agency awarded this contract?
Awarding agency: Department of Housing and Urban Development (Department of Housing and Urban Development).
What is the total obligated amount?
The obligated amount is $17.4 million.
What is the period of performance?
Start: 2000-05-25. End: 2008-09-26.
What was the justification for awarding this electricity contract on a sole-source basis, and was a market research conducted to confirm no other viable providers existed?
The provided data states the contract was 'NOT AVAILABLE FOR COMPETITION,' implying a sole-source justification. However, the specific reasons for this determination are not detailed. Typically, agencies must document why full and open competition is not feasible, such as unique capabilities or urgent needs. Without this documentation, it's difficult to assess if taxpayer funds were optimally used.
How does the per-unit cost of electricity under this contract compare to other federal agencies or commercial rates in the Washington D.C. area over the contract period?
A direct per-unit cost comparison is challenging without detailed usage metrics and specific rate structures from PEPCO. The contract value of $17.4M over 3046 days ($5,718/day) provides a daily average, but actual kilowatt-hour consumption fluctuates. Benchmarking against other government contracts or commercial rates would require access to detailed pricing schedules and consumption data.
What mechanisms are in place to manage price fluctuations and ensure cost-effectiveness for the government over the 8-year contract duration?
The contract type is 'FIRM FIXED PRICE,' which generally shields the government from price increases by the contractor. However, the initial fixed price itself could be higher due to the lack of competition and the long duration. Without specific contract clauses addressing potential escalations or review points, the government might be locked into a potentially unfavorable rate if market conditions change significantly.
Industry Classification
NAICS: Information › Sound Recording Industries › Record Production
Product/Service Code: MISCELLANEOUS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: Pepco Holdings LLC (UEI: 105895010)
Address: 701 9TH STREET, N.W., WASHINGTON, DC, 98
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $48,586,212
Exercised Options: $48,586,212
Current Obligation: $17,416,719
Timeline
Start Date: 2000-05-25
Current End Date: 2008-09-26
Potential End Date: 2008-09-26 00:00:00
Last Modified: 2011-06-06
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