EPA Spends $59M on Duke Energy Electrical Services Over 10 Years
Contract Overview
Contract Amount: $59,090,628 ($59.1M)
Contractor: Duke Energy Carolinas, LLC
Awarding Agency: Environmental Protection Agency
Start Date: 2005-03-09
End Date: 2015-02-28
Contract Duration: 3,643 days
Daily Burn Rate: $16.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: TIME AND MATERIALS
Sector: Energy
Official Description: ELECTRICAL UTILITY SERVICES
Place of Performance
Location: DURHAM, DURHAM County, NORTH CAROLINA, 27711
Plain-Language Summary
Environmental Protection Agency obligated $59.1 million to DUKE ENERGY CAROLINAS, LLC for work described as: ELECTRICAL UTILITY SERVICES Key points: 1. Significant expenditure of $59.1 million over a decade for electrical utility services. 2. Contract awarded to Duke Energy Carolinas, LLC, a major utility provider. 3. Full and open competition was utilized, suggesting a competitive bidding process. 4. The contract type is Time and Materials, which can pose cost control challenges.
Value Assessment
Rating: fair
The contract's Time and Materials pricing structure, coupled with its long duration, raises concerns about potential cost overruns and the absence of fixed price incentives. Benchmarking against similar long-term utility service contracts would be necessary for a more precise valuation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. However, the Time and Materials pricing model may limit the effectiveness of price discovery compared to fixed-price contracts.
Taxpayer Impact: Taxpayer funds were utilized for essential electrical utility services. While competition was present, the pricing structure warrants scrutiny to ensure cost-effectiveness.
Public Impact
Ensures reliable electrical power for EPA operations in North Carolina. Supports a major utility provider, Duke Energy, contributing to regional infrastructure. The long contract duration suggests a sustained need for these services. Potential for cost escalation due to Time and Materials pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Time and Materials pricing
- Long contract duration (10 years)
- Lack of small business participation
Positive Signals
- Full and open competition
- Essential service provision
Sector Analysis
This contract falls under electrical utility services, a critical sector for government operations. Spending benchmarks for such services can vary widely based on location, demand, and contract structure. The $59 million over 10 years represents a substantial, long-term commitment.
Small Business Impact
The data indicates no small business participation in this contract. Given the nature of large-scale utility services, it is common for prime contracts to be awarded to major providers, potentially limiting opportunities for smaller businesses in this specific award.
Oversight & Accountability
The contract's long duration and Time and Materials pricing model suggest a need for robust oversight to monitor costs and ensure performance aligns with taxpayer expectations. Regular reviews and audits would be crucial.
Related Government Programs
- Electric Power Distribution
- Environmental Protection Agency Contracting
- Environmental Protection Agency Programs
Risk Flags
- Potential for cost overruns due to Time and Materials pricing.
- Lack of small business participation.
- Long contract duration may reduce flexibility.
- Limited price certainty over the contract's life.
Tags
electric-power-distribution, environmental-protection-agency, nc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Environmental Protection Agency awarded $59.1 million to DUKE ENERGY CAROLINAS, LLC. ELECTRICAL UTILITY SERVICES
Who is the contractor on this award?
The obligated recipient is DUKE ENERGY CAROLINAS, LLC.
Which agency awarded this contract?
Awarding agency: Environmental Protection Agency (Environmental Protection Agency).
What is the total obligated amount?
The obligated amount is $59.1 million.
What is the period of performance?
Start: 2005-03-09. End: 2015-02-28.
What was the average annual cost of these electrical utility services?
The total contract value was $59,090,627.68 over a period of 3643 days, which is approximately 10 years. Dividing the total cost by the number of years gives an average annual cost of roughly $5.9 million. This figure provides a baseline for understanding the scale of spending on these essential services.
What specific risks are associated with the Time and Materials pricing structure over a decade?
The primary risk of Time and Materials (T&M) contracts, especially over a long duration like 10 years, is the potential for cost escalation without a clear ceiling. It can incentivize longer task durations and higher labor rates, making it difficult for the government to control overall expenditure and ensure the best value for taxpayer money.
How effective was the full and open competition in achieving competitive pricing for these services?
While full and open competition theoretically promotes competitive pricing, the Time and Materials structure may have mitigated some of its effectiveness. The government secured a provider, but the T&M model means the final price is heavily dependent on actual labor and material costs incurred, rather than a pre-negotiated fixed price, potentially limiting the long-term price certainty.
Industry Classification
NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation ID: PRNC0510261
Offers Received: 1
Pricing Type: TIME AND MATERIALS (Y)
Contractor Details
Parent Company: Duke Energy Corporation (UEI: 006996052)
Address: 422 S CHURCH ST, CHARLOTTE, NC, 28242
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $100,298,500
Exercised Options: $100,298,500
Current Obligation: $59,090,628
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Timeline
Start Date: 2005-03-09
Current End Date: 2015-02-28
Potential End Date: 2015-02-28 00:00:00
Last Modified: 2020-03-27
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