DoD's $30.8M Energy Conservation Contract with NORESCO, LLC awarded via Full and Open Competition
Contract Overview
Contract Amount: $30,863,563 ($30.9M)
Contractor: Noresco, LLC
Awarding Agency: Department of Defense
Start Date: 2014-07-30
End Date: 2039-03-01
Contract Duration: 8,980 days
Daily Burn Rate: $3.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 10
Pricing Type: FIRM FIXED PRICE
Sector: Other
Official Description: IGF::OT::IGF THE CONTRACTOR WILL COMPLETE INSTALLATION AND PERFORMANCE OF ENERGY CONSERVATION MEASURES IN ACCORDANCE WITH TASK ORDER AND THE REFERENCED DEPARTMNENT OF ENERGY SUPER ENERGY SAVINGS PERFORMANCE CONTRACT.
Place of Performance
Location: COLUMBIA, RICHLAND County, SOUTH CAROLINA, 29207
Plain-Language Summary
Department of Defense obligated $30.9 million to NORESCO, LLC for work described as: IGF::OT::IGF THE CONTRACTOR WILL COMPLETE INSTALLATION AND PERFORMANCE OF ENERGY CONSERVATION MEASURES IN ACCORDANCE WITH TASK ORDER AND THE REFERENCED DEPARTMNENT OF ENERGY SUPER ENERGY SAVINGS PERFORMANCE CONTRACT. Key points: 1. Contract focuses on energy conservation measures, indicating a commitment to operational efficiency and sustainability. 2. Long-term duration (2014-2039) suggests a strategic investment in infrastructure upgrades. 3. Awarded under Full and Open Competition, implying a broad market solicitation. 4. The contract type is Firm Fixed Price, which transfers cost risk to the contractor. 5. The contract is a Delivery Order under a larger Task Order structure. 6. The North American Industry Classification System (NAICS) code 541330 points to Engineering Services.
Value Assessment
Rating: good
The contract value of $30.8 million for energy conservation measures over a 15-year period appears reasonable for a large-scale federal project. Benchmarking against similar Energy Savings Performance Contracts (ESPCs) would provide a more precise value-for-money assessment. The firm fixed-price nature of the contract helps in predictable budgeting, though it relies on the contractor's accurate cost estimation.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded through Full and Open Competition, suggesting that all responsible sources were permitted to submit a bid. The presence of 10 bids indicates a healthy level of interest and competition within the market for energy conservation services. This broad competition is generally expected to drive more competitive pricing and a wider range of technical solutions.
Taxpayer Impact: A competitive bidding process for energy conservation projects like this one can lead to better pricing and more innovative solutions for taxpayers, ensuring federal funds are used efficiently to achieve energy savings.
Public Impact
The Department of Defense benefits from reduced energy costs and improved facility performance. Services delivered include the installation and performance of energy conservation measures. The geographic impact is focused on facilities within South Carolina. The contract supports the federal government's broader energy efficiency and sustainability goals.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration could lead to vendor lock-in if not managed carefully.
- Performance metrics and verification of energy savings need rigorous oversight.
- Potential for scope creep if initial energy conservation measures are not clearly defined.
Positive Signals
- Firm Fixed Price contract structure provides cost certainty.
- Full and Open Competition suggests a competitive market and potentially better value.
- Focus on energy conservation aligns with federal sustainability mandates.
Sector Analysis
This contract falls within the Engineering Services sector, specifically related to energy efficiency and conservation. The market for federal energy performance contracts is substantial, driven by government mandates to reduce energy consumption and operational costs. NORESCO, LLC is a known entity in this space, often competing for and winning large-scale ESPCs with various federal agencies.
Small Business Impact
The data indicates this contract was awarded under Full and Open Competition and does not specify any small business set-aside. While the primary awardee is NORESCO, LLC, there is potential for subcontracting opportunities for small businesses within the scope of the energy conservation measures, though this is not explicitly detailed in the provided information.
Oversight & Accountability
The contract is a Delivery Order under a Task Order, suggesting a structured oversight framework. The firm fixed-price nature implies that the contractor bears the primary responsibility for cost overruns. Accountability for performance and energy savings will likely be managed through contract milestones, inspections, and post-installation verification processes, potentially involving agency contracting officers and technical representatives.
Related Government Programs
- Energy Savings Performance Contracts (ESPCs)
- Department of Defense Facilities Management
- Federal Energy Management Program (FEMP)
- Engineering Services Contracts
Risk Flags
- Long-term contract duration requires ongoing performance monitoring.
- Verification of energy savings is critical to ensure value for money.
- Potential for cost overruns if unforeseen issues arise, despite fixed-price structure.
Tags
energy-conservation, engineering-services, department-of-defense, defense-logistics-agency, firm-fixed-price, full-and-open-competition, delivery-order, south-carolina, federal-contract, infrastructure-upgrade, sustainability
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $30.9 million to NORESCO, LLC. IGF::OT::IGF THE CONTRACTOR WILL COMPLETE INSTALLATION AND PERFORMANCE OF ENERGY CONSERVATION MEASURES IN ACCORDANCE WITH TASK ORDER AND THE REFERENCED DEPARTMNENT OF ENERGY SUPER ENERGY SAVINGS PERFORMANCE CONTRACT.
Who is the contractor on this award?
The obligated recipient is NORESCO, LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Logistics Agency).
What is the total obligated amount?
The obligated amount is $30.9 million.
What is the period of performance?
Start: 2014-07-30. End: 2039-03-01.
What is NORESCO, LLC's track record with similar federal energy conservation contracts?
NORESCO, LLC has a significant track record with federal agencies, including the Department of Defense, in executing large-scale Energy Savings Performance Contracts (ESPCs). They are known for undertaking complex projects involving infrastructure upgrades and energy efficiency improvements across various federal installations. Their experience often includes managing long-term contracts with firm-fixed-price structures, similar to this award. A detailed review of their past performance on similar ESPCs would reveal their success in meeting energy savings targets, managing budgets, and adhering to project timelines, providing context for the current contract's potential outcomes.
How does the $30.8 million value compare to similar federal energy conservation contracts?
The $30.8 million contract value for energy conservation measures over a 15-year period is substantial, aligning with the scale of projects typically undertaken by major ESPC providers for large federal agencies like the Department of Defense. Comparable contracts often range from tens to hundreds of millions of dollars, depending on the size and scope of the facilities being upgraded and the complexity of the energy conservation measures implemented. Factors such as the specific technologies deployed (e.g., HVAC upgrades, lighting retrofits, renewable energy integration) and the duration of the performance period influence the total contract value. Without specific details on the measures included, a direct comparison is challenging, but the value is within the expected range for a significant federal ESPC.
What are the primary risks associated with this firm-fixed-price energy conservation contract?
The primary risks associated with this firm-fixed-price energy conservation contract, despite its cost certainty for the government, lie in the contractor's ability to accurately estimate all costs and achieve the projected energy savings. If unforeseen technical challenges arise during installation or if energy prices fluctuate significantly in a way that impacts savings calculations, NORESCO, LLC could face financial strain. Conversely, if the contractor overestimates costs or savings, the government might not realize the full expected value. Rigorous performance verification and clear contract terms are crucial to mitigate these risks and ensure the government receives the intended benefits.
How effective are Energy Savings Performance Contracts (ESPCs) in achieving federal energy reduction goals?
ESPCs have generally been effective tools for federal agencies to achieve energy reduction goals and improve facility infrastructure without upfront capital investment. Under an ESPC, the contractor finances the project and is repaid through the energy and operational cost savings achieved. This performance-based model incentivizes the contractor to implement efficient technologies and practices. Numerous studies and IG reports indicate that ESPCs have successfully reduced energy consumption and utility costs across federal facilities. However, effectiveness can vary based on contract specifics, the accuracy of baseline energy use calculations, and the robustness of measurement and verification protocols.
What is the historical spending trend for engineering services related to energy conservation within the Department of Defense?
Historical spending by the Department of Defense (DoD) on engineering services for energy conservation has been substantial and generally increasing, driven by legislative mandates and strategic goals for energy resilience and efficiency. The DoD is one of the largest energy consumers globally, making investments in energy conservation critical. Spending in this area encompasses a range of activities, including energy audits, feasibility studies, design and engineering for upgrades, and the implementation of energy conservation measures through various contract vehicles like ESPCs. The trend reflects a sustained commitment to modernizing infrastructure and reducing its environmental footprint and operational costs.
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: 10
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 1 RESEARCH DR STE 400 C, WESTBOROUGH, MA, 01581
Business Categories: Category Business, Limited Liability Corporation, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $88,722,511
Exercised Options: $88,722,511
Current Obligation: $30,863,563
Actual Outlays: $295,422
Subaward Activity
Number of Subawards: 6
Total Subaward Amount: $15,644,594
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: DEAM3609GO29039
IDV Type: IDC
Timeline
Start Date: 2014-07-30
Current End Date: 2039-03-01
Potential End Date: 2039-03-01 00:00:00
Last Modified: 2025-12-08
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