Interior Department's $17.3M Energy Savings Contract Awarded to Johnson Controls Government Systems

Contract Overview

Contract Amount: $17,355,200 ($17.4M)

Contractor: Johnson Controls Government Systems, LLC

Awarding Agency: Department of the Interior

Start Date: 2010-03-31

End Date: 2012-10-03

Contract Duration: 917 days

Daily Burn Rate: $18.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 8

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: ENERGY SVNGS PERFORMANCE CONTRACT PHS 3 TAS::14 1108::TAS PROJECT NOS. LXCAP0320000, LACAP0350000, LDDFR0370000, LACAP0650000, LDDFR0380000, LADAP0270000, LACAP0220000, LACAP0260000, LACAP0310000, LXCAP0050000, LXCAP0160000, LACAP050000, LACAP0070000, LX.CA.P0660000, LX.CA.P0700000, LX.CA.90710000, LX.CA.P0510000 TAS::14 1112::TAS

Place of Performance

Location: MILWAUKEE, MILWAUKEE County, WISCONSIN, 53202

State: Wisconsin Government Spending

Plain-Language Summary

Department of the Interior obligated $17.4 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC for work described as: ENERGY SVNGS PERFORMANCE CONTRACT PHS 3 TAS::14 1108::TAS PROJECT NOS. LXCAP0320000, LACAP0350000, LDDFR0370000, LACAP0650000, LDDFR0380000, LADAP0270000, LACAP0220000, LACAP0260000, LACAP0310000, LXCAP0050000, LXCAP0160000, LACAP050000, LACAP0070000, LX.CA.P0660000, LX.CA.P07… Key points: 1. Contract focuses on energy savings performance, indicating a goal of reducing operational costs through efficiency improvements. 2. The award to a single contractor suggests a specific expertise or capability was sought for this project. 3. A firm fixed-price contract type generally transfers risk to the contractor, ensuring cost certainty for the government. 4. The duration of the contract (over 900 days) points to a substantial project scope requiring significant implementation and monitoring. 5. The contract was awarded under full and open competition, suggesting a broad market search for the best value. 6. The project is located in Wisconsin, implying a specific geographic focus for the energy efficiency upgrades.

Value Assessment

Rating: good

The contract value of $17.3 million for energy savings performance over approximately two and a half years appears reasonable for a project of this nature. While specific benchmarks for energy savings performance contracts are difficult to ascertain without detailed project scope, the firm fixed-price structure suggests the contractor is incentivized to deliver cost savings. Comparing this to similar large-scale energy efficiency projects for federal agencies, the pricing seems within a typical range, assuming the scope of work involves significant infrastructure upgrades and system modernizations.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded through full and open competition, indicating that the Bureau of Land Management sought proposals from all responsible sources. The fact that eight bids were received suggests a healthy level of interest and competition within the market for energy savings performance contracts. This broad competition is generally favorable for price discovery and allows the agency to select the offer that provides the best overall value, considering technical approach, past performance, and price.

Taxpayer Impact: Full and open competition typically leads to more competitive pricing, which benefits taxpayers by ensuring the government is not overpaying for services. It also promotes innovation as contractors vie to offer the most effective solutions.

Public Impact

The primary beneficiaries are the Department of the Interior and its Bureau of Land Management, which will see reduced energy expenditures and improved operational efficiency. The contract delivers energy efficiency upgrades and services, likely encompassing areas such as lighting, HVAC systems, and building controls. The geographic impact is concentrated in Wisconsin, where the specific federal facilities or properties included in the contract are located. Workforce implications may include the employment of skilled technicians, engineers, and project managers by the contractor and potentially by the agency for oversight.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if the scope of work expands beyond initial projections.
Risk of performance not meeting the projected energy savings targets, impacting the return on investment.
Dependence on contractor expertise for successful implementation and long-term system performance.

Positive Signals

Firm fixed-price contract provides cost certainty for the government.
Awarded through full and open competition, suggesting a competitive selection process.
Focus on energy savings aligns with federal sustainability goals and can lead to long-term cost reductions.

Sector Analysis

Energy Savings Performance Contracts (ESPCs) are a key mechanism for federal agencies to improve energy efficiency and reduce utility costs without upfront capital investment. These contracts leverage private sector expertise and financing to implement energy conservation measures. The market for ESPCs is robust, with numerous established players like Johnson Controls Government Systems. This contract fits within the broader trend of federal agencies seeking to modernize infrastructure and meet congressionally mandated energy reduction targets. Comparable spending benchmarks vary widely based on the scope and scale of the energy conservation measures implemented.

Small Business Impact

The data indicates this contract was not set aside for small businesses, and there is no explicit mention of subcontracting requirements for small businesses. Therefore, the direct impact on the small business ecosystem is likely minimal unless the prime contractor voluntarily engages small businesses for specific components or services. Further analysis would be needed to determine if any subcontracting plans were mandated or voluntarily pursued by Johnson Controls Government Systems.

Oversight & Accountability

Oversight for this contract would primarily reside with the Bureau of Land Management's contracting officers and program managers. They are responsible for monitoring contractor performance, ensuring compliance with contract terms, and verifying that the projected energy savings are achieved. The firm fixed-price nature of the contract shifts some performance risk to the contractor, but government oversight is still crucial for quality assurance and accountability. Transparency is facilitated through contract award databases, but detailed performance reports may not be publicly accessible.

Related Government Programs

Energy Independence and Security Act of 2007
Federal Energy Management Program (FEMP)
Department of Energy (DOE) ESPC Program
Bureau of Land Management Facility Management
Government-wide energy efficiency initiatives

Risk Flags

Contract duration exceeds typical project timelines, requiring sustained oversight.
Performance metrics and verification processes are critical for realizing value.
Potential for scope creep if not managed tightly.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $17.4 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC. ENERGY SVNGS PERFORMANCE CONTRACT PHS 3 TAS::14 1108::TAS PROJECT NOS. LXCAP0320000, LACAP0350000, LDDFR0370000, LACAP0650000, LDDFR0380000, LADAP0270000, LACAP0220000, LACAP0260000, LACAP0310000, LXCAP0050000, LXCAP0160000, LACAP050000, LACAP0070000, LX.CA.P0660000, LX.CA.P0700000, LX.CA.90710000, LX.CA.P0510000 TAS::14 1112::TAS

Who is the contractor on this award?

The obligated recipient is JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Bureau of Land Management).

What is the total obligated amount?

The obligated amount is $17.4 million.

What is the period of performance?

Start: 2010-03-31. End: 2012-10-03.

What specific energy conservation measures (ECMs) were included in this contract, and what were their projected savings?

The provided data does not detail the specific energy conservation measures (ECMs) included in this contract. Energy Savings Performance Contracts (ESPCs) typically encompass a range of upgrades such as lighting retrofits, HVAC system modernization, building envelope improvements, and the installation of renewable energy sources. The projected savings for each ECM, and the total projected savings, would have been a critical component of the proposal evaluated by the Bureau of Land Management. Without access to the contract's statement of work or performance work statement, a precise breakdown of ECMs and their anticipated financial and energy benefits cannot be determined from the available data.

How does the contract's value compare to other similar energy savings performance contracts awarded by the federal government?

The contract value of $17.3 million for Johnson Controls Government Systems falls within a moderate to large range for federal ESPCs. ESPCs can vary significantly in cost, from hundreds of thousands to tens or even hundreds of millions of dollars, depending on the size and complexity of the facilities being upgraded, the types of ECMs implemented, and the duration of the contract. For instance, large-scale ESPCs involving entire agency campuses or multiple facilities can easily exceed $50 million. Smaller, facility-specific projects might be in the low millions. This $17.3 million contract suggests a substantial project, likely involving significant infrastructure upgrades across multiple buildings or a large single facility, and appears to be a typical investment for achieving substantial energy cost reductions over the contract's lifespan.

What is Johnson Controls Government Systems' track record with federal ESPCs, and have they successfully delivered on similar projects?

Johnson Controls Government Systems is a well-established provider of building efficiency and control solutions, with a significant history of performing Energy Savings Performance Contracts (ESPCs) for federal agencies. While the specific performance data for this particular $17.3 million contract with the Department of the Interior is not detailed here, the company has a broad portfolio of completed ESPCs across various government departments and military branches. Success in ESPCs is typically measured by the achievement of guaranteed energy savings, project completion within budget and schedule, and client satisfaction. Johnson Controls generally has a strong reputation in this market, often cited for their technical capabilities and experience in delivering complex energy efficiency projects. Agencies often select contractors with proven track records to mitigate performance risks inherent in ESPCs.

What are the key performance indicators (KPIs) used to measure the success of this energy savings contract?

The primary Key Performance Indicator (KPI) for an Energy Savings Performance Contract (ESPC) is the actual energy and cost savings achieved compared to the baseline established at the beginning of the contract. This contract likely includes specific metrics related to reductions in electricity, natural gas, or other energy consumption, translated into dollar savings. Other potential KPIs could include the successful implementation of all specified energy conservation measures (ECMs), system uptime and reliability post-upgrade, and adherence to project timelines. The government agency (Bureau of Land Management) would typically conduct Measurement and Verification (M&V) activities to confirm that the guaranteed savings are being realized over the contract period.

How has federal spending on energy savings performance contracts evolved over the years, and where does this contract fit in?

Federal spending on Energy Savings Performance Contracts (ESPCs) has generally trended upwards over the past two decades, driven by legislative mandates, increasing energy costs, and a growing focus on sustainability and climate resilience. Agencies are encouraged to utilize ESPCs as a tool to meet energy reduction goals without requiring upfront appropriations. The total annual value of federal ESPCs can fluctuate, but it typically represents a significant investment in infrastructure modernization. This $17.3 million contract awarded in 2010 fits within this trend as a substantial project undertaken during a period of increased emphasis on federal energy efficiency. It represents a typical investment size for a comprehensive energy upgrade project aimed at achieving significant long-term operational cost savings for the agency.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: NATURAL RESOURCES MANAGEMENT › NATURAL RESOURCE CONSERVERVAT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 8

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Johnson Controls Inc (UEI: 006092860)

Address: 507 E. MICHIGAN ST., MILWAUKEE, WI, 04

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,355,200

Exercised Options: $17,355,200

Current Obligation: $17,355,200

Parent Contract

Parent Award PIID: DEAM3609GO29036

IDV Type: IDC

Timeline