Naval Base Coronado Boiler Plant Upgrade: $51.8M Contract Awarded to Energy Systems Group LLC
Contract Overview
Contract Amount: $51,781,096 ($51.8M)
Contractor: Energy Systems Group LLC
Awarding Agency: Department of Defense
Start Date: 2016-12-13
End Date: 2041-11-20
Contract Duration: 9,108 days
Daily Burn Rate: $5.7K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 6
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: IGF::OT::IGF ESPC AT NAVAL BASE CORONADO. CONSTRUCTION AND PERFORMANCE SERVICES FOR BOILER PLANT IMPROVEMENT AND ENERGY/UTILITY DISTRIBUTION SYSTEM.
Place of Performance
Location: SAN DIEGO, SAN DIEGO County, CALIFORNIA, 92135
Plain-Language Summary
Department of Defense obligated $51.8 million to ENERGY SYSTEMS GROUP LLC for work described as: IGF::OT::IGF ESPC AT NAVAL BASE CORONADO. CONSTRUCTION AND PERFORMANCE SERVICES FOR BOILER PLANT IMPROVEMENT AND ENERGY/UTILITY DISTRIBUTION SYSTEM. Key points: 1. The contract focuses on construction and performance services for a boiler plant improvement and energy/utility distribution system. 2. Energy Systems Group LLC is the awardee, indicating a specific vendor's expertise in this niche. 3. The project spans over 24 years, suggesting a long-term commitment to energy efficiency and infrastructure. 4. The contract type is Firm Fixed Price, which shifts cost risk to the contractor.
Value Assessment
Rating: good
The contract value of $51.8 million for a 24-year project appears reasonable given the scope of construction and performance services for a major facility's boiler plant and utility systems. Benchmarking against similar large-scale energy infrastructure projects would provide a more precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting a competitive bidding process that likely led to a fair market price. The use of a Delivery Order under a larger contract structure implies a structured procurement approach.
Taxpayer Impact: The long-term nature of the contract aims to improve energy efficiency, which should lead to cost savings for taxpayers over the life of the project.
Public Impact
Improved energy efficiency at a major naval base, potentially reducing operational costs. Modernization of critical infrastructure, ensuring reliable utility services for base operations. Potential for reduced environmental impact through upgraded energy systems. Long-term employment opportunities related to construction and ongoing performance services.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (24 years) may present risks related to technological obsolescence or changing energy landscapes.
- Firm Fixed Price contract could lead to cost overruns if unforeseen issues arise during construction.
- Lack of specific small business participation noted (sb: false).
Positive Signals
- Awarded under full and open competition.
- Focus on energy efficiency and infrastructure modernization.
- Firm Fixed Price contract shifts risk to contractor.
Sector Analysis
This contract falls within the Engineering Services sector, specifically related to energy infrastructure improvements. Spending in this area is critical for government facilities to maintain operational efficiency and meet energy goals. Benchmarks for similar large-scale energy retrofits and utility system upgrades are typically in the tens to hundreds of millions of dollars.
Small Business Impact
The data indicates that small business participation was not a specific set-aside or requirement for this contract (sb: false). While the prime contractor is Energy Systems Group LLC, further analysis would be needed to determine if any subcontracting opportunities were allocated to small businesses.
Oversight & Accountability
The contract was awarded as a Delivery Order, suggesting it might be part of a larger indefinite-delivery/indefinite-quantity (IDIQ) contract. Oversight would involve monitoring performance against the contract terms, ensuring milestones are met, and verifying energy savings projections. The long duration necessitates robust oversight mechanisms.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Long contract duration (24 years)
- Firm Fixed Price contract
- No explicit small business participation noted
- Potential for technological obsolescence
- Reliance on contractor performance over an extended period
Tags
engineering-services, department-of-defense, ca, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $51.8 million to ENERGY SYSTEMS GROUP LLC. IGF::OT::IGF ESPC AT NAVAL BASE CORONADO. CONSTRUCTION AND PERFORMANCE SERVICES FOR BOILER PLANT IMPROVEMENT AND ENERGY/UTILITY DISTRIBUTION SYSTEM.
Who is the contractor on this award?
The obligated recipient is ENERGY SYSTEMS GROUP LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $51.8 million.
What is the period of performance?
Start: 2016-12-13. End: 2041-11-20.
What is the projected return on investment (ROI) for this energy efficiency project, and how is it being measured?
The projected ROI is not explicitly detailed in the provided data. However, the contract's focus on 'performance services' suggests that the contractor is incentivized to achieve specific energy savings. Measurement would likely involve comparing pre- and post-upgrade energy consumption data, verified against established baselines and contractually agreed-upon metrics. The long-term nature of the contract implies that ROI is expected over many years.
What are the specific risks associated with a 24-year performance contract for boiler plant improvements, and how are they mitigated?
Risks include technological obsolescence of boiler systems, changes in energy regulations or fuel costs, and potential degradation of performance over time. Mitigation strategies could involve performance incentives tied to efficiency metrics, periodic system reviews, and contract clauses allowing for adjustments based on significant external factors. The firm-fixed-price nature also places some risk on the contractor for initial construction.
How does the cost of this contract compare to similar energy infrastructure projects at other federal facilities of comparable size and scope?
Without specific cost breakdowns for components (e.g., boiler replacement, distribution system upgrades) and detailed project scopes from comparable contracts, a precise comparison is difficult. However, $51.8 million for a comprehensive, long-term upgrade at a major naval base aligns with the high costs associated with large-scale federal infrastructure modernization. The full and open competition suggests a competitive pricing environment.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 6
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Energy Systems Group, LLC
Address: 4655 ROSEBUD LN, NEWBURGH, IN, 47630
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $192,407,432
Exercised Options: $192,407,432
Current Obligation: $51,781,096
Actual Outlays: $17,422,340
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DEAM3609GO29030
IDV Type: IDC
Timeline
Start Date: 2016-12-13
Current End Date: 2041-11-20
Potential End Date: 2041-11-20 00:00:00
Last Modified: 2025-12-10
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