DoD Awards $18.5M for Electric Power Generation to Virginia Electric and Power Company
Contract Overview
Contract Amount: $18,540,038 ($18.5M)
Contractor: Virginia Electric and Power Company
Awarding Agency: Department of Defense
Start Date: 2020-09-23
End Date: 2059-04-30
Contract Duration: 14,098 days
Daily Burn Rate: $1.3K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: UESC MCBQ
Place of Performance
Location: QUANTICO, PRINCE WILLIAM County, VIRGINIA, 22134
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $18.5 million to VIRGINIA ELECTRIC AND POWER COMPANY for work described as: UESC MCBQ Key points: 1. Significant long-term contract awarded to a single incumbent provider. 2. Limited competition due to contract type and incumbent status. 3. Potential for cost overruns given the long duration and fixed-price nature. 4. Sector focus on essential utility services for military operations.
Value Assessment
Rating: fair
The contract value of $18.5M over 14 years suggests a moderate annual spend. Benchmarking is difficult without specific service details, but the long duration and fixed-price nature may not reflect current market rates.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was not available for competition, indicating a sole-source or limited award. This lack of competition likely impacts price discovery and may lead to less favorable pricing for the government.
Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive bidding, especially given the extended contract period.
Public Impact
Ensures continued power supply for naval facilities, critical for operations. Long-term commitment may lock in potentially outdated pricing structures. Lack of competition raises concerns about efficient use of taxpayer funds.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Long contract duration
- Potential for price escalation
Positive Signals
- Ensures critical utility service
- Fixed-price contract limits cost uncertainty
Sector Analysis
This contract falls within the utility services sector, specifically electric power generation for government facilities. Spending in this area is generally stable but can be subject to market fluctuations and regulatory changes.
Small Business Impact
There is no indication that small businesses were involved in this contract award. The award went to a large utility provider, suggesting limited opportunities for small business participation.
Oversight & Accountability
The long duration of this contract warrants close oversight to ensure continued value and adherence to terms. Regular performance reviews are essential to mitigate risks associated with fixed-price, long-term agreements.
Related Government Programs
- Other Electric Power Generation
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Long contract duration (over 14 years)
- Potential for price escalation
- Limited transparency on justification for sole-source award
- No indication of small business participation
Tags
other-electric-power-generation, department-of-defense, va, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $18.5 million to VIRGINIA ELECTRIC AND POWER COMPANY. UESC MCBQ
Who is the contractor on this award?
The obligated recipient is VIRGINIA ELECTRIC AND POWER COMPANY.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $18.5 million.
What is the period of performance?
Start: 2020-09-23. End: 2059-04-30.
What is the justification for awarding this contract on a limited/sole-source basis, and what steps were taken to ensure fair pricing?
The justification for limited competition is not provided in the data. Typically, such awards are made when only one source can fulfill the requirement due to unique capabilities or existing infrastructure. Without competitive bidding, it is crucial for the agency to conduct thorough market research and price analysis to ensure the negotiated price is fair and reasonable, potentially through benchmarking against similar contracts or independent cost estimates.
What are the potential risks associated with a fixed-price contract lasting nearly 15 years for electric power generation?
A fixed-price contract of this duration carries risks of both under- and over-payment. For the government, the risk is paying above market rates if energy prices decrease or technology improves significantly. For the contractor, the risk is absorbing unexpected cost increases due to inflation, regulatory changes, or unforeseen operational challenges. The long term also reduces flexibility to adopt more efficient or cost-effective solutions that may emerge.
How does this contract contribute to the overall effectiveness of the Department of the Navy's operations in Virginia?
This contract ensures a reliable and continuous supply of electricity, which is fundamental to the effective operation of naval facilities. Consistent power is essential for everything from basic infrastructure to advanced technological systems. By securing this service through a long-term agreement, the Navy can maintain operational readiness and avoid disruptions that could impact mission accomplishment.
Industry Classification
NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Other Electric Power Generation
Product/Service Code: UTILITIES AND HOUSEKEEPING › UTILITIES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Dominion Energy, Inc.
Address: 120 TREDEGAR ST, RICHMOND, VA, 23219
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $19,110,804
Exercised Options: $19,110,804
Current Obligation: $18,540,038
Actual Outlays: $10,133,073
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: 47PA0418D0072
IDV Type: IDC
Timeline
Start Date: 2020-09-23
Current End Date: 2059-04-30
Potential End Date: 2059-04-30 00:00:00
Last Modified: 2025-05-01
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