NASA's $31.4M Electric Power Contract with Cleveland Electric Illuminating Co. Faces Scrutiny
Contract Overview
Contract Amount: $31,444,838 ($31.4M)
Contractor: THE Cleveland Electric Illuminating CO
Awarding Agency: National Aeronautics and Space Administration
Start Date: 2016-06-01
End Date: 2022-04-30
Contract Duration: 2,159 days
Daily Burn Rate: $14.6K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Energy
Official Description: IGF::OT::IGF ELECTRIC POWER SUPPLY FOR GLENN RESEARCH CENTER
Place of Performance
Location: CLEVELAND, CUYAHOGA County, OHIO, 44114
State: Ohio Government Spending
Plain-Language Summary
National Aeronautics and Space Administration obligated $31.4 million to THE CLEVELAND ELECTRIC ILLUMINATING CO for work described as: IGF::OT::IGF ELECTRIC POWER SUPPLY FOR GLENN RESEARCH CENTER Key points: 1. Significant contract value of $31.4 million over its duration. 2. Sole-source award raises questions about price discovery and competition. 3. Long contract duration (2016-2022) may not reflect current market rates. 4. Electric power sector is essential but subject to price fluctuations.
Value Assessment
Rating: questionable
The contract's firm fixed price was set in 2016. Without competitive bidding, it's difficult to assess if the price remains fair and reasonable compared to current market rates for electric power, especially given potential energy market volatility.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract was awarded on a sole-source basis, indicating a lack of competition. This limits the government's ability to leverage market forces to achieve the best possible price and terms.
Taxpayer Impact: The absence of competition may lead to taxpayers paying a premium for electric power, as the government did not benefit from potential cost savings that competitive bidding could have provided.
Public Impact
Essential infrastructure for NASA's Glenn Research Center relies on this power supply. Potential for higher costs impacts NASA's operational budget. Lack of transparency in pricing due to sole-source award.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Long contract duration
- Potential for uncompetitive pricing
Positive Signals
- Essential service provided
- Firm fixed price contract type
Sector Analysis
This contract falls within the Utilities and Energy sector, specifically providing essential electric power. Benchmarks for electric power contracts vary widely based on location, demand, and market conditions, but sole-source awards often deviate from competitive norms.
Small Business Impact
The data does not indicate any involvement of small businesses in this contract. The award was made to a large utility provider.
Oversight & Accountability
The sole-source nature of this award warrants closer oversight to ensure the pricing remains fair and reasonable throughout the contract period, and to understand why competition was not pursued.
Related Government Programs
- Electric Power Distribution
- National Aeronautics and Space Administration Contracting
- National Aeronautics and Space Administration Programs
Risk Flags
- Sole-source award limits price competition.
- Potential for uncompetitive pricing due to lack of market pressure.
- Long contract duration may not reflect current market value.
- Lack of transparency in price justification.
- No indication of small business participation.
Tags
electric-power-distribution, national-aeronautics-and-space-administr, oh, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
National Aeronautics and Space Administration awarded $31.4 million to THE CLEVELAND ELECTRIC ILLUMINATING CO. IGF::OT::IGF ELECTRIC POWER SUPPLY FOR GLENN RESEARCH CENTER
Who is the contractor on this award?
The obligated recipient is THE CLEVELAND ELECTRIC ILLUMINATING CO.
Which agency awarded this contract?
Awarding agency: National Aeronautics and Space Administration (National Aeronautics and Space Administration).
What is the total obligated amount?
The obligated amount is $31.4 million.
What is the period of performance?
Start: 2016-06-01. End: 2022-04-30.
What was the justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The provided data states the contract was 'NOT AVAILABLE FOR COMPETITION,' implying a sole-source justification. However, the specific reasons for this determination are not detailed. Typically, sole-source awards are justified by factors such as unique capabilities, urgent needs, or lack of other responsible sources. Without further documentation, it's unclear if a thorough market analysis was conducted to confirm the absence of viable competitive options.
How does the firm fixed price compare to current market rates for similar electric power services in Ohio?
Assessing the current fairness of the firm fixed price is challenging without a competitive benchmark. Given the contract's start date in 2016 and end in 2022, energy market prices may have shifted significantly. A comparison with recent, competitively awarded electric power contracts in the same region would be necessary to determine if the government received value for money.
What is the potential financial impact on taxpayers due to the lack of competition for this essential service?
The lack of competition inherently increases the risk of overpayment. Without competitive pressure, the awarded price may be higher than what could have been achieved through a bidding process. While the exact overpayment is unknown without a benchmark, sole-source contracts for essential services like electricity can represent a significant, albeit often unquantifiable, financial burden on taxpayers over their duration.
Industry Classification
NAICS: Utilities › Electric Power Generation, Transmission and Distribution › Electric Power Distribution
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: Firstenergy Corp
Address: 696 EUCLID AVE, CLEVELAND, OH, 44114
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $31,444,838
Exercised Options: $31,444,838
Current Obligation: $31,444,838
Actual Outlays: $4,226,953
Contract Characteristics
Multi-Year Contract: Yes
Commercial Item: COMMERCIAL ITEM
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: GS00P09BSD0693
IDV Type: IDC
Timeline
Start Date: 2016-06-01
Current End Date: 2022-04-30
Potential End Date: 2022-04-30 00:00:00
Last Modified: 2022-06-08
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