DoD's $79M Barkley Power Plant Turbine Rehab Contract with Andritz Hydro Faces Potential Cost Overruns and Limited Small Business Impact
Contract Overview
Contract Amount: $79,189,961 ($79.2M)
Contractor: Andritz Hydro Corp
Awarding Agency: Department of Defense
Start Date: 2020-09-29
End Date: 2027-09-01
Contract Duration: 2,528 days
Daily Burn Rate: $31.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: Construction
Official Description: BARKLEY POWER PLANT TURBINE GENERATOR REHABILITATION FOR UNITS 1-4.
Place of Performance
Location: KUTTAWA, LYON County, KENTUCKY, 42055
State: Kentucky Government Spending
Plain-Language Summary
Department of Defense obligated $79.2 million to ANDRITZ HYDRO CORP for work described as: BARKLEY POWER PLANT TURBINE GENERATOR REHABILITATION FOR UNITS 1-4. Key points: 1. The contract awarded to Andritz Hydro Corp for $79.2M aims to rehabilitate turbine generators at Barkley Power Plant. 2. The project spans over 2500 days, indicating a long-term, complex undertaking with potential for schedule slippage. 3. Limited small business participation is noted, raising concerns about equitable distribution of contract value. 4. The sector is 'Other Heavy and Civil Engineering Construction,' a critical area for infrastructure maintenance and upgrades.
Value Assessment
Rating: questionable
The contract's total value is $79.2M. Without specific benchmarks for turbine generator rehabilitation, it's difficult to definitively assess pricing. However, the duration and complexity suggest potential for cost growth.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, which typically fosters competitive pricing. However, the long duration and specialized nature of the work may limit the number of truly competitive bids.
Taxpayer Impact: While competition was open, the long-term nature and potential for cost growth could impact the final taxpayer expense if not managed effectively.
Public Impact
Ensures continued operation of critical power generation infrastructure. Supports national energy security by maintaining reliable power sources. Potential for job creation within the heavy construction and engineering sectors. Long project duration may lead to extended disruptions or phased impacts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long contract duration (2528 days)
- Limited small business involvement
- Potential for cost overruns due to project complexity and duration
Positive Signals
- Awarded under full and open competition
- Addresses critical infrastructure maintenance
Sector Analysis
This contract falls within the 'Other Heavy and Civil Engineering Construction' sector, which is vital for maintaining and upgrading national infrastructure. Spending in this sector can fluctuate based on government infrastructure initiatives and maintenance needs.
Small Business Impact
The contract indicates no small business participation (ss: false, sb: false). This suggests that the prime contractor, Andritz Hydro Corp, is handling the entire scope, potentially missing opportunities to leverage small business capabilities and economic benefits.
Oversight & Accountability
The long duration of the contract necessitates robust oversight from the Department of the Army to ensure adherence to schedule, budget, and performance standards. Regular progress reviews and audits will be crucial for accountability.
Related Government Programs
- Other Heavy and Civil Engineering Construction
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Potential for cost overruns due to long duration and complexity.
- Lack of small business participation.
- Extended project timeline increases risk of unforeseen issues.
- Dependency on a single large contractor for specialized work.
Tags
other-heavy-and-civil-engineering-constr, department-of-defense, ky, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $79.2 million to ANDRITZ HYDRO CORP. BARKLEY POWER PLANT TURBINE GENERATOR REHABILITATION FOR UNITS 1-4.
Who is the contractor on this award?
The obligated recipient is ANDRITZ HYDRO CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $79.2 million.
What is the period of performance?
Start: 2020-09-29. End: 2027-09-01.
What is the projected cost per turbine generator rehabilitation, and how does it compare to industry averages for similar projects?
The total contract value is $79.2 million for four units, averaging approximately $19.8 million per unit. Without specific details on the scope of rehabilitation for each unit and comparable industry data for similar complex turbine generator overhauls, a precise benchmark is difficult. However, this figure provides a starting point for cost analysis against industry standards.
What are the specific risks associated with the 2528-day duration, and what mitigation strategies are in place?
The extended duration presents risks such as material price escalation, technological obsolescence, potential for unforeseen site conditions, and contractor performance degradation. Mitigation strategies likely include robust contract clauses for price adjustments, phased performance reviews, contingency planning for site issues, and strong project management oversight to maintain focus and quality.
How will the effectiveness of the turbine generator rehabilitation be measured to ensure optimal performance and longevity?
Effectiveness will likely be measured through a combination of pre-rehabilitation baseline performance data, post-rehabilitation performance testing (e.g., efficiency, output capacity, vibration levels), and ongoing operational monitoring. Key performance indicators (KPIs) tied to reliability, availability, and maintainability will be crucial, alongside adherence to manufacturer specifications and industry best practices.
Industry Classification
NAICS: Construction › Other Heavy and Civil Engineering Construction › Other Heavy and Civil Engineering Construction
Product/Service Code: MAINT, REPAIR, ALTER REAL PROPERTY › MAINT, ALTER, REPAIR NONBUILDINGS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SEALED BID
Solicitation ID: W912P519B0003
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Andritz AG
Address: 10735 DAVID TAYLOR DR STE 500, CHARLOTTE, NC, 28262
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $82,853,549
Exercised Options: $79,189,961
Current Obligation: $79,189,961
Actual Outlays: $7,360,500
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2020-09-29
Current End Date: 2027-09-01
Potential End Date: 2027-09-01 00:00:00
Last Modified: 2025-10-10
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