A.02.08 Sole Source Determination (HITACHI-ABB) - Redacted.pdf

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Control Number 23-0015

SOLE SOURCE DETERMINATION

(HITACHI/ABB)

FAR Subpart 13.106-1(b)

1. CONTRACTING AGENCY: US Army Corps of Engineers (USACE), Walla Walla District (CENWW- CT) 201 North 3rd, Walla Walla, WA 99362.

2. DESCRIPTION OF THE ACTION: This action is for a new Firm Fixed Price (FFP) contract to purchase HITACHI/ABB Generator Step Up (GSU) Transformer overhaul parts such as the transformer gaskets and radiator valve rebuild kits. This action meets the definition of a commercial item as defined in FAR 2.101. This action will be funded by FY23 BPA NREX funding.

3. DESCRIPTION OF THE SERVICES/SUPPLIES: This action is for the procurement of HITACHI merged with ABB Generator Step Up (GSU) Transformer overhaul components such as gaskets, radiator rebuild kits for use on the Westinghouse GSU Transformers. The HITACHI/ABB components will be used as replacements during transformer maintenance at the Lower Granite Powerhouse. Below is a list of all the required items:

Manufacturer Part Number Description Qty

HITACHI/ABB 763C035H02 Radiator Gaskets 268 HITACHI/ABB 763C102HO1 Rect. Manhole Gaskets 5 HITACHI/ABB 763C036H21 HV Bushing Gaskets 5 HITACHI/ABB 769C036H09 LV Bushing Gaskets 20 HITACHI/ABB 763C035H15 H-2 bushing gasket 5 HITACHI/ABB 763C035H08 Oil Gage Gasket 5 HITACHI/ABB 584A750G04 Radiator Valve Packing Kit 184

The estimated total value of this action is below the simplified acquisition threshold (SAT).

Anticipated cost:

4. AUTHORITY CITED:

FAR 13.106-l (b) Soliciting from a single source. (1) For purchases not exceeding the simplified acquisition threshold, contracting officers may solicit from one source if the contracting officer determines that the circumstances of the contract action deem only one source reasonably available (e.g., urgency, exclusive licensing agreements, brand name, or industrial mobilization).

FAR 11.105(a)(1) the particular brand name, product, or feature is essential to the Government's requirements, and market research indicates other companies' similar products, or products lacking the particular feature, do not meet, or cannot be modified to meet, the agency's needs.

5. REASON FOR AUTHORITY CITED:

a. BACKGROUND:

• Lower Granite Project presently has 6 Westinghouse Generator Step Up (GSU) transformers. Lower

Granite utilizes three single-phase transformers to transmit 3-phase power to the BPA switchyard and power grid per bank (T1 & T2). The T1 bank, consists of T1A, T1B, and T1C and the T2 bank consists of T2A, T2B and T2C. T1A was overhauled in Nov. 2022-Jan 2023 but the worn-out bellows were not replaced on T1A.

• The scheduling and coordination of transformer maintenance represents over a year of effort by all parties to ensure a planned temporary outage creates as little impact to normal operations as possible. Coordinating parties include, but are not limited to, fish managers, BPA, and Operations at Lower Granite.

• Maintenance and outage timing is significant as any disruption(s) greatly impacts ESA listed fish and water quality, and power generation mission(s).

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b. JUSTIFICATION:

• The remaining transformers (T1B, T1C and T2 bank) are leaking and need overhaul parts. The HITACHI/ABB parts listed above are required since the existing parts have reached the end of their service life. The parts needed are critical and must be replaced in kind. The transformer plans are owned by HITACHI/ABB and no other manufacturer can make the parts without reverse engineering them.

• Moreover, as the market research will show, no other business, large or small, are able to meet our requirements.

• Therefore, procuring critical parts and replacing in kind through the sole source (HITACHI/ABB) will remove unnecessary performance and compatibility risks, ultimately preventing additional costs and loss of production revenue.

c. IMPACT:

• There is no way to accurately estimate unforeseen labor time and costs associated with using another manufacturer regarding form, fit, and function as the products would be new. If alternative, non-Brand specific products are purchased, it is unknown how much each transformer will need to be retrofitted to enable use of a different manufacturer’s parts.

• T1 bank transformers service 4 generating units critical for adult fish passage, river total dissolved gas mitigation, and power generation. Outages of the named transformer(s), planned or otherwise, represent an extremely high-cost impact with the last similar outage costing in lost power generation revenue.

• Therefore, if parts are not able to be procured to meet mission needs, the resulting failure would have an extremely high-cost impact both in dollar value and mission function.

6. ALTERNATIVES:

a. No reasonable alternatives to named products or vendors are available. If Lower Granite cannot purchase named parts there is no way to predict the quality and or reliability of those manufactured parts, nor do other vendors capable of meeting mission constraints exist. Not knowing the source of the parts, as well as, going with a manufacturing that doesn’t hold the prints for the Westinghouse transformer parts (propriety to Hitachi) adds additional time, costs, and risk to these transformer repairs. HITACHI/ABB (products sole source) can provide known solutions and are replacing in kind items. The lost generation revenue can range up to per day, per unit. An unplanned transformer outage can cost upwards of per day in lost revenue.

b. Additionally, the market research shows that no other reasonable source is able to provide the necessary products apart from Hitachi/ABB (See section 8 & 9).

7. DETERMINATION OF FAIR AND REASONABLE COSTS: A price analysis will be completed after receipt of quotation on the basis of historical pricing and the IGE. No award will be made unless prices are determined fair and reasonable.

8. EFFORTS TO OBTAIN COMPETITION:

a. A full and open Sources Sought was completed and two eligible, small business responses were received.

However, no large business responses were received. This created a reasonable expectation for price competition among small businesses.

b. In response to the sources sought, a solicitation was issued as a 100% small business set-aside. Between the sources sought and interests expressed during the solicitation, there was a reasonable expectation to receive quotes from at least small businesses. However, only response was received after two extensions (Solicitation was public for 23 calendar days). Two additional requests for extension were received since.