Alabama Power Company awarded $23.7M Utility Energy Services Contract for electric power distribution

Contract Overview

Contract Amount: $23,727,696 ($23.7M)

Contractor: Alabama Power Company

Awarding Agency: Department of Defense

Start Date: 2016-08-11

End Date: 2018-06-05

Contract Duration: 663 days

Daily Burn Rate: $35.8K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Energy

Official Description: UTILITY ENERGY SERVICES CONTRACT (UESC) IGF::OT::IGF

Place of Performance

Location: BIRMINGHAM, JEFFERSON County, ALABAMA, 35291

State: Alabama Government Spending

Plain-Language Summary

Department of Defense obligated $23.7 million to ALABAMA POWER COMPANY for work described as: UTILITY ENERGY SERVICES CONTRACT (UESC) IGF::OT::IGF Key points: 1. Contract value represents a significant investment in energy infrastructure. 2. Sole-source award suggests limited market engagement or specific capabilities required. 3. Contract duration of 663 days indicates a medium-term project. 4. Fixed-price contract type aims to control costs for the government. 5. Focus on electric power distribution highlights critical infrastructure needs. 6. Geographic focus on Alabama suggests regional energy service delivery.

Value Assessment

Rating: fair

The contract value of $23.7 million for electric power distribution services is substantial. Benchmarking this against similar Utility Energy Services Contracts (UESCs) is difficult without more specific details on the scope of work. However, the fixed-price nature of the contract provides some cost certainty. The absence of a clear per-unit cost benchmark makes a precise value-for-money assessment challenging, but the duration and scope suggest a potentially fair price for the services rendered.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when a specific contractor possesses unique capabilities, or when it is impractical or uneconomical to obtain competition. The lack of competition means that the government did not benefit from potential price reductions or innovative solutions that might have emerged from a competitive bidding process.

Taxpayer Impact: For taxpayers, a sole-source award can potentially lead to higher costs compared to a competitively bid contract, as the government may not achieve the best possible price.

Public Impact

The Department of the Army benefits from improved electric power distribution infrastructure. Services delivered likely include upgrades, maintenance, and management of electrical systems. Geographic impact is concentrated within Alabama, supporting military installations in the state. Workforce implications may involve specialized technicians and engineers for energy services.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may result in a higher price than a fully competed contract.
Sole-source awards can limit opportunities for other qualified vendors.
Specific performance metrics and quality assurance details are not readily available.

Positive Signals

Fixed-price contract provides cost predictability for the government.
Focus on essential utility services ensures operational continuity.
Award to an established utility provider suggests a degree of reliability.

Sector Analysis

Utility Energy Services Contracts (UESCs) are a common mechanism for federal agencies to improve energy efficiency and infrastructure. The market for these services is substantial, involving utilities and specialized energy service companies. This contract fits within the broader energy sector, specifically focusing on the distribution of electricity. Comparable spending benchmarks would depend on the specific upgrades and services provided, but UESCs often range from millions to tens of millions of dollars.

Small Business Impact

This contract does not appear to have a small business set-aside. As a sole-source award, it is unlikely to include subcontracting opportunities for small businesses unless specifically mandated by the prime contractor. The absence of a set-aside means that small businesses in the energy services sector may not directly benefit from this particular contract award.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer's representative (COR) within the Department of the Army. Accountability measures would be tied to the terms and conditions of the fixed-price contract, including delivery schedules and performance standards. Transparency is limited due to the sole-source nature, but contract award data is publicly available.

Related Government Programs

Utility Energy Services Contracts (UESCs)
Energy Infrastructure Modernization
Department of Defense Energy Programs
Electric Power Distribution Services

Risk Flags

Sole-source award may indicate limited competition, potentially leading to higher costs.
Lack of detailed scope of work makes precise value assessment difficult.
Performance metrics and specific outcomes are not detailed in the provided data.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $23.7 million to ALABAMA POWER COMPANY. UTILITY ENERGY SERVICES CONTRACT (UESC) IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is ALABAMA POWER COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $23.7 million.

What is the period of performance?

Start: 2016-08-11. End: 2018-06-05.

What specific energy efficiency measures or infrastructure upgrades are included in this contract?

The provided data does not specify the exact scope of work beyond 'Electric Power Distribution'. Utility Energy Services Contracts (UESCs) typically encompass a range of services aimed at improving energy efficiency and modernizing infrastructure. This could include upgrades to lighting, HVAC systems, building envelopes, renewable energy installations, and smart grid technologies. Without further details, it's impossible to ascertain the precise measures undertaken. However, the contract's value and duration suggest a significant project, likely involving substantial physical infrastructure improvements or system overhauls to enhance reliability and reduce energy consumption for Department of the Army facilities in Alabama.

How does the $23.7 million contract value compare to typical UESC awards for similar services?

The $23.7 million contract value falls within the upper range of typical Utility Energy Services Contracts (UESCs), especially for projects involving significant infrastructure upgrades or comprehensive energy management solutions. While smaller UESCs can be in the low millions, larger, more complex projects, particularly those supporting substantial federal facilities or installations, can easily reach or exceed this amount. The specific nature of the electric power distribution upgrades, the number of facilities covered, and the duration of the contract (663 days) are key factors influencing the overall cost. Without a detailed breakdown of the services and deliverables, a precise comparison is challenging, but the award is substantial and indicative of a significant undertaking.

What are the potential risks associated with awarding this contract on a sole-source basis?

The primary risk associated with a sole-source award is the potential for a higher price due to the lack of competition. Without competing bids, the government may not achieve the most cost-effective solution. There's also a risk of reduced innovation, as the contractor may have less incentive to propose novel or highly efficient approaches compared to a competitive environment. Furthermore, sole-source awards can limit opportunities for other qualified vendors, potentially impacting the broader market ecosystem. Ensuring robust oversight and performance management becomes even more critical to mitigate these risks and ensure the government receives fair value.

What is Alabama Power Company's track record with federal UESC contracts?

Alabama Power Company, as a major utility provider, likely has extensive experience in managing and executing energy-related projects, including those for government entities. While specific details on their past federal UESC contracts are not provided in this data, utilities of this scale often engage in such agreements to support federal installations within their service territories. Their established infrastructure, operational expertise, and familiarity with regulatory requirements position them as a capable provider. A deeper dive into their contract history with agencies like the Department of Defense would reveal their performance trends, project successes, and any past issues related to federal energy contracts.

What are the expected performance outcomes and benefits for the Department of the Army?

The expected performance outcomes for the Department of the Army center on improved reliability, efficiency, and potentially cost savings related to electric power distribution. This could manifest as reduced energy consumption, lower utility bills, enhanced power quality, and decreased downtime due to system failures. Modernized distribution systems can also improve security and resilience against disruptions. The contract aims to ensure that military facilities in Alabama have a stable and efficient power supply, which is critical for operational readiness and mission accomplishment. Long-term benefits include a more sustainable energy infrastructure and potentially lower lifecycle costs.

How does this contract align with broader federal energy policy goals?

This contract aligns with broader federal energy policy goals by focusing on the modernization and efficiency of critical energy infrastructure. Federal agencies are mandated to improve energy efficiency, reduce greenhouse gas emissions, and enhance energy resilience. Utility Energy Services Contracts (UESCs) are a key tool for achieving these objectives. By investing in electric power distribution upgrades, the Department of the Army is contributing to a more robust and potentially more sustainable energy system, supporting national goals for energy security and environmental stewardship. The emphasis on reliable power delivery also supports the operational readiness of military installations.

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

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Southern CO Services Inc

Address: 600 N 18TH ST, BIRMINGHAM, AL, 35291

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $23,727,696

Exercised Options: $23,727,696

Current Obligation: $23,727,696

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL ITEM

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: GS00P15BSD1133

IDV Type: IDC

Timeline