Over $30M for ESPC Services at Naval Base Guam, awarded to Johnson Controls Government Systems, LLC

Contract Overview

Contract Amount: $30,383,306 ($30.4M)

Contractor: Johnson Controls Government Systems, LLC

Awarding Agency: Department of Defense

Start Date: 2009-04-20

End Date: 2028-03-31

Contract Duration: 6,920 days

Daily Burn Rate: $4.4K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 21

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: ESPC SERVICES AT NAVAL BASE GUAM

Place of Performance

Location: AGAT, GUAM County, GUAM, 96928

Plain-Language Summary

Department of Defense obligated $30.4 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC for work described as: ESPC SERVICES AT NAVAL BASE GUAM Key points: 1. Analysis indicates a long-term commitment to energy efficiency upgrades at a significant installation. 2. The contract's duration suggests a comprehensive approach to facility modernization and operational improvements. 3. Competition dynamics will be crucial in assessing the value achieved over the contract's lifespan. 4. Performance metrics and energy savings will be key indicators of success for this extensive project. 5. The scope of work likely encompasses a wide range of energy-consuming systems within the base. 6. Geographic location presents unique logistical considerations for service delivery and oversight.

Value Assessment

Rating: good

The total award amount of over $30 million for Energy Savings Performance Contract (ESPC) services at Naval Base Guam appears substantial, reflecting the scale of infrastructure improvements expected. Benchmarking this against similar large-scale ESPC projects at military installations is necessary for a precise value-for-money assessment. However, the long performance period (2009-2028) suggests a phased approach to upgrades, which can be cost-effective if managed efficiently. The firm-fixed-price nature of the award provides cost certainty, but the ultimate value will depend on the realized energy savings and the contractor's ability to meet performance targets.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of 21 bids suggests a robust competitive environment, which typically drives down prices and encourages innovation. The extensive number of bidders implies that the market for such services is healthy and that the government likely received competitive pricing. This level of competition is a positive signal for achieving good value for taxpayer money.

Taxpayer Impact: The full and open competition with 21 bidders suggests that taxpayers benefited from a competitive bidding process, likely resulting in more favorable pricing and a wider range of technical solutions being considered.

Public Impact

Naval Base Guam personnel and operations will benefit from modernized, more energy-efficient facilities. Services delivered are expected to improve the reliability and sustainability of critical base infrastructure. The geographic impact is concentrated at Naval Base Guam, enhancing its operational capabilities. Workforce implications may include specialized technical roles for installation and maintenance of energy systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (nearly 19 years) could lead to scope creep or evolving technology obsolescence if not managed proactively.
Reliance on a single contractor for such a long period may limit future flexibility in adopting new technologies or service providers.
Ensuring consistent performance and accountability over nearly two decades requires robust ongoing oversight.

Positive Signals

Awarded under full and open competition with 21 bids, indicating strong market interest and potential for competitive pricing.
The contract aims to achieve energy savings, aligning with federal sustainability goals and potentially reducing long-term operational costs.
The firm-fixed-price contract structure provides cost certainty for the government.

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. The market for ESPC services is substantial, driven by government mandates for sustainability and cost reduction. This contract fits within the broader sector of facility management and energy services, with numerous private sector firms offering specialized expertise. Comparable spending benchmarks for ESPCs at large military installations can vary widely based on the scope of work and the specific technologies implemented.

Small Business Impact

The provided data does not indicate any specific small business set-asides or subcontracting requirements for this contract. As a large prime contract awarded to Johnson Controls Government Systems, LLC, the primary impact on small businesses would be through potential subcontracting opportunities. The extent of small business participation would depend on the prime contractor's subcontracting plan and the nature of the services required, which are not detailed here.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy and potentially the Department of Defense's Inspector General. Given the long duration and significant value, robust oversight mechanisms are crucial. These would likely include regular performance reviews, verification of energy savings, and audits to ensure compliance with contract terms. Transparency is enhanced by the public nature of contract awards, but detailed performance reporting would be essential for full accountability.

Related Government Programs

Energy Savings Performance Contracts (ESPCs)
Federal Energy Management Program (FEMP)
Department of Defense Facility Modernization Programs
Naval Facilities Engineering Command (NAVFAC) Contracts

Risk Flags

Long contract duration may require adaptive management for technological obsolescence.
Ensuring consistent performance verification over nearly two decades requires robust oversight.
Potential for changes in energy markets or federal policy impacting savings projections.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.4 million to JOHNSON CONTROLS GOVERNMENT SYSTEMS, LLC. ESPC SERVICES AT NAVAL BASE GUAM

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 Defense (Department of the Navy).

What is the total obligated amount?

The obligated amount is $30.4 million.

What is the period of performance?

Start: 2009-04-20. End: 2028-03-31.

What is the historical spending trend for ESPC services at Naval Base Guam or similar Navy installations?

Analyzing historical spending trends for ESPC services at Naval Base Guam or comparable Navy installations requires access to detailed contract databases and agency budget reports. Generally, federal agencies, including the Department of the Navy, have increasingly utilized ESPCs to meet energy efficiency mandates and reduce operational costs. Spending in this area can fluctuate based on available funding, specific infrastructure needs, and the prioritization of energy projects. Larger installations like Naval Base Guam often have recurring needs for upgrades, suggesting a potential for consistent, albeit variable, ESPC spending over time. Without specific historical data for this location, it's difficult to provide precise figures, but the trend across the federal government has been towards greater investment in energy efficiency solutions.

How does the per-unit cost of the services under this contract compare to industry benchmarks for similar ESPC projects?

Determining the per-unit cost comparison for this ESPC contract is challenging without specific details on the 'units' of service being measured (e.g., per square foot of facility, per kilowatt-hour saved, per installed device). ESPCs are complex projects involving a wide array of energy conservation measures (ECMs), making direct per-unit cost comparisons difficult. However, the fact that this contract was awarded under full and open competition with 21 bidders suggests that the pricing was likely competitive. Agencies typically benchmark ESPC proposals against projected energy savings and established industry cost factors for specific ECMs. Johnson Controls, as a major player in this market, would be expected to offer competitive rates, but a definitive benchmark would require detailed cost breakdowns and comparison with similar projects' financial structures.

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

Key Performance Indicators (KPIs) for Energy Savings Performance Contracts (ESPCs) typically revolve around the achievement of guaranteed energy and water savings, operational cost reductions, and the successful implementation of energy conservation measures (ECMs). For this contract at Naval Base Guam, KPIs would likely include metrics such as: 1. Verified energy savings (e.g., reduction in kWh, therms) against a baseline. 2. Cost savings realized from reduced utility bills. 3. Performance and reliability of installed equipment (e.g., HVAC systems, lighting, building controls). 4. Compliance with project schedules and milestones. 5. Customer satisfaction regarding facility improvements and operational impact. The contract's success hinges on the contractor's ability to demonstrably meet or exceed these savings guarantees over the contract's lifespan.

What is Johnson Controls Government Systems, LLC's track record with similar large-scale ESPC contracts for the Department of Defense?

Johnson Controls Government Systems, LLC (JCG) has a significant track record in delivering Energy Savings Performance Contracts (ESPCs) and other facility-related services to the Department of Defense (DoD) and other federal agencies. They are a well-established provider in the energy services market, known for their expertise in building automation, HVAC, and energy efficiency solutions. JCG has been involved in numerous large-scale projects across various military branches, often focusing on modernizing infrastructure to improve efficiency and reduce operational costs. Their experience typically includes managing complex projects from design through implementation and long-term measurement and verification of savings. Past performance reviews and contract databases would provide more specific details on their success rates, project scope, and client satisfaction for similar DoD ESPC contracts.

What are the potential risks associated with the long duration (2009-2028) of this contract?

The extended duration of this ESPC contract, spanning nearly two decades, presents several potential risks. Firstly, technological advancements in energy efficiency could render the installed systems or planned upgrades obsolete before the contract ends, potentially leading to suboptimal performance or the need for costly retrofits. Secondly, changes in energy prices or federal energy policies could impact the projected savings and the contract's financial viability. Thirdly, maintaining consistent oversight and accountability over such a long period can be challenging for the contracting agency, increasing the risk of performance degradation or non-compliance. Finally, the contractor's financial stability and corporate focus could shift over such a long timeframe, potentially affecting their commitment to the project's long-term success.

How does this contract align with broader federal goals for sustainability and climate resilience?

This ESPC contract directly aligns with broader federal goals for sustainability and climate resilience by focusing on improving energy efficiency and reducing the carbon footprint of a major military installation. Federal mandates, such as Executive Orders on climate change and sustainability, require agencies to reduce greenhouse gas emissions, increase renewable energy use, and enhance the resilience of federal infrastructure. By investing in energy-saving measures, this contract contributes to reducing energy consumption and associated emissions. Furthermore, modernizing building systems can improve operational resilience against disruptions, such as extreme weather events, by ensuring more reliable power and climate control within facilities. The long-term nature of the contract supports sustained progress towards these federal objectives.

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

Offers Received: 21

Pricing Type: FIRM FIXED PRICE (J)

Contractor Details

Address: 507 E. MICHIGAN STREET, MILWAUKEE, WI, 53201

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $34,134,694

Exercised Options: $34,134,694

Current Obligation: $30,383,306

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Parent Contract

Parent Award PIID: DEAM3697EE73568

IDV Type: IDC

Timeline