A1_Final JA-RDI UC Palo Seco OM-20231117_18 Nov 23.pdf

Control Number: CECT-NOW-24-01

(Source Selection information - See FAR 2.101 and 3.104-4)

CUI/SP-SSEL

Justification Review Document for Other than Full and Open Competition - FAR Part 6

Program/Equipment: Modification to extend emergency power generation services at the Palo Seco Power Plant, San Juan, PR, under the Rapid Disaster Infrastructure (RDI) Indefinite Delivery, Indefinite Quantity (IDIQ), Multiple Award Task Order Contract (MATOC) Contract W9128F20D0005, Task Order W9128F23D0065 to continue emergency power generation services to mitigate power instability on the Puerto Rico power grid as a result of damage from Hurricane Fiona in September 2022 to the power generation capabilities of the U.S. Territory of Puerto Rico and its communities.

Authority: 10 U.S.C. § 3204(a)(2) as implemented by Federal Acquisition Regulation (FAR), 6.302-2, Unusual and Compelling Urgency.

Amount: $765,000,000

Prepared by:

Typed Name: John H. Tucker II DSN: 402-995-2824 Title: Branch Chief, Special Projects Branch Date: 17 Nov 2023 E-mail: John.H.Tucker@usace.army.mil

Contracting Officer:

Typed Name: John H. Tucker II DSN: 402-995-2824 Date Reviewed: 17 Nov 2023 E-Mail: John.H.Tucker@usace.army.mil

Technical Representative:

Typed Name: Timothy P. Gouger DSN: 402-995-2191 Title: Rapid Response TCX Program Manager Date: 17 Nov 2023

Requirements Representative:

Typed Name: Gregory C. Herring DSN: 402-995-2644 Title: Supervisory Program Manager Date: 17 Nov 2023

Controlled by: Dept of the Army Controlled by: USACE, Omaha District CUI Category: SP-SSEL Distribution/Dissemination Controls: FED ONLY

POC: CENWO-CT

Control Number: CECT NOW 24 01

(Source Selection Information See FAR 2.101 and 3.104 4)

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Reviews

I have reviewed this justification and find it adequate to support other than full and open competition.

Legal Counsel

Typed Name: Tristan S. Brown DSN: 202-761-8541

Signature: _________________________________ Date: _______________________

Command Advocate for Competition

Typed Name: ____ Jason K. Jefferis_____________ DSN: 202-761-4707 _________

Signature: _________________________________ Date: ______________________

Head of the Contracting Activity

Typed Name: _____ Jason K. Jefferis____________ DSN: 202-761-4707 _________

Signature: _________________________________ Date: ______________________

BROWN.TRISTAN.S.13

94813717

Digitally signed by

BROWN.TRISTAN.S.1394813717

Date: 2023.11.18 17:04:39 -05'00' 11/18/2023

JEFFERIS.JASON.KEI

TH.1123718700

Digitally signed by

JEFFERIS.JASON.KEITH.1123718700

Date: 2023.11.19 08:05:50 -05'00'

JEFFERIS.JASON.KEI

TH.1123718700

Digitally signed by

JEFFERIS.JASON.KEITH.1123718700

Date: 2023.11.19 08:06:08 -05'00'

CUI/SP SSEL

Justification and Approval for Other than Full and Open Competition – FAR Part 6

1. Contracting Activity: U.S. Army Corps of Engineers (USACE), Northwestern Division, Omaha District (NWO), Contracting Division, Special Projects Branch (CECT-NWO- SP), 1616 Capitol Avenue, Omaha, NE 68102.

2. Description of Action: Hurricane Fiona (a Category 1 hurricane) made landfall on September 18, 2022, and caused a power blackout to all of Puerto Rico for several days, once again demonstrating the precarious nature of power generation, transmission, and distribution systems on the island. On September 18, 2022, Presidential Declaration, Federal Emergency Management Agency (FEMA)-3583-EM- PR, was issued to lessen or avert the threat of catastrophe in all 78 municipalities designated for emergency protective measures (Category B), including direct federal assistance, under the FEMA Public Assistance program. FEMA issued USACE a mission assignment to provide a minimum of 24 months of emergency power to be supplied to the Puerto Rico power grid. The approval is for a modification to extend emergency power generation services currently being executed under the Omaha District’s Rapid, Disaster, Infrastructure (RDI) Multiple Award Task Order Contract (MATOC) vehicle, contract W9128F20D0005, task order W9128F23F0065 at the Palo Seco, Puerto Rico power plant by six months, using Civil Funds for Federal Assistance.

DHS FEMA Federal Assistance is 070 0413.The modification will be executed in accordance with the current FEMA Mission Assignment Task Order (MATO) authorization of 15 March 2024 and will not be extended beyond 15 March without corresponding FEMA MATO revision.

3. Description of Supplies/Services: In response to the FEMA requirement, Omaha district, Rapid Response-Technical Center of Expertise (RR-TCX), RDI program was tasked via the Savannah District with applying emergency supplementary power on the grid at Palo Seco and San Juan Power Plants. This Scope of Work (SOW) is specific to power generation needs at Palo Seco Power Plant. In general, the contractor mobilized, completed site preparation, constructed/installed, and commissioned generators capable to provide a net continuous output 150 MW at Palo Seco Power Plant to mitigate power instability on the grid and an initial operation and maintenance period of six months.

Emergency power generation is currently being executed under the Omaha District’s RDI MATOC vehicle, contract W9128F20D0005, task order W9128F23F0065, that was put in place 24 February 2023 under coordination with Savannah District and mission assignment by FEMA. The original task order award Scope of Work included construction/installation of temporary power generators and electrical distribution system to tie into the existing power grid, commissioning, shakedown of the generators to provide continuous power output, and an initial six months of operation and maintenance (O&M). The RDI contract vehicle is a construction contract. Although the original award was predominately construction, the addition of this magnitude of services in the form of Operations and maintenance change the predominance of the scope to services. Therefore, this modification is considered out of scope.

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To meet the original FEMA tasker of providing an overall minimum of 24 months of emergency power to be supplied to the Puerto Rico power grid, Savannah District and Omaha District developed the strategy of utilizing the Omaha District’s RDI MATOC vehicle to construct/install the power generation equipment and conduct the shakedown, commissioning, and initial operation of the generation equipment for an initial six-month period. The initial six-month period was designed to allow time for the Savannah District to solicit and execute a long-term contract vehicle for O&M of the same power generation equipment installed under the RDI contract. The Omaha District commissioned and began operation of the generators on 7 June 2023. During the initial O&M period, there were several delays/changes to ensure the generators were configured and operating to the required standards. These delays pushed the end of the six-month O&M period to 28 November 2023.

4. Authority Cited: 10 United States Code 3204(a)(2) as implemented by Federal Acquisition Regulation 6.302-2(a)(2), Unusual and Compelling Urgency, when the agency’s need for the supplies or services is of such an unusual and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided for.

5. Reason for Authority Cited: In support of the Presidential National Emergency Declaration, consistent with FAR 6.302-2(a)(2) when the agency’s need for the supplies or services is of such an unusually and compelling urgency that the Government would be seriously injured unless the agency is permitted to limit the number of sources from which it solicits bids or proposals, full and open competition need not be provided for.

Justification: The Savannah District issued a task order solicitation under their newly executed “Puerto Rico Power System Stabilization, Power Generation Services” MATOC contract on 5 October 2023 and received proposals on 31 October 2023. On 31 October 2023, Savannah District was notified that a pre-award protest had been filed with the Government Accounting Office (GAO). As a result of the protest and insufficient funding, Savannah District filed with GAO to cancel the solicitation and therefore was unable to execute a long-term task order and assume/transfer the power generation requirement from the Omaha RDI task order under the Savannah MATOC task order.

Savannah District and Omaha District’s leadership conducted multiple strategy meetings to develop a resolution to enable the continued power generation in Puerto Rico in light of the protest received. Due to the time required to resolve the protest, with insufficient time to resolicit and issue a new contract or task order, and the impending end of the six-month O&M period of the current RDI task order, there is an urgent need to develop an alternate solution to continue uninterrupted power to the Puerto Rico power grid. The most practicable resolution under the present conditions is to continue O&M operations under the existing Omaha District RDI task order considering the urgency to have a solution in place prior to expiration of the current task order. This appears the only viable option to be able to continue supplying uninterrupted power to the people on the island of Puerto Rico. FEMA has tasked USACE with continuing to apply power to the Puerto Rican power grid, and with Savannah District unable to

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provide continued O&M operations in a timely manner, FEMA and Savannah have turned to Omaha to utilize the RDI action currently in place to continue power production.

Alternatives: Leadership within both the Omaha and Savannah Districts have had multiple conversations to develop a possible solution in the limited time remaining for this critical task to continue power generation in Puerto Rico. Resolving the Savannah District protest would expend more time than remains before the current O&M period expires. Resoliciting and issuing a new contract or task order would also not result in award in time for the expiration of O&M on 28 November 2023.

The urgent need to develop an alternate solution is best resolved by continuing the O&M on the current RDI task order. The need to continue uninterrupted power applied to the Puerto Rico power grid is so time-critical that the best and most feasible solution under the current conditions is to continue operation under the existing RDI task order.

This appears the only viable option to be able to continue supplying uninterrupted power to the island and the people of Puerto Rico.

In addition, to be able to continue uninterrupted power Weston Solution, the contractor currently performing the construction and O&M projects, has stated that a modification needs to be executed on/around 21 November 2023 to be able to coordinate resources (personnel/fuel delivery) to continue uninterrupted power production under the existing task order. Weston is currently mobilized to the site, has constructed the emergency power generators and is under contract with the only available resource/subcontractor (NFEnergy) available to provide resources such as Liquid Natural Gas supply to the Palo Seco operation. NFEnergy owns and operates the only property available for performance under this task order and owns the only available fuel management/supply source for this action that is currently under contract by Weston. The remaining contractors in the RDI MATOC pool would not be able to satisfy the requirement as they would have to re-negotiate with the sole local provider of property and fuel available for this action if it was to be recompeted among the MATOC holders. This would be similar to full and open competition, would require soliciting available subcontractors NFEnergy who is already operating as a subcontractor for Weston the current RDI contractor performing in Puerto Rico), would require demobilization of current resources, mobilization of new resources, which would not meet the urgent need of executing an action prior to the date of 21 November 2023.

Another consideration was to conduct a Competition in Contracting Act (CICA) Override for Savannah to award their task order while addressing the GAO protest. The magnitude of the proposals (three times the estimate) and well above the budget available from FEMA made the task order otherwise unawardable, even with a CICA override.

Impact: As determined by the issuance of the Presidential National Emergency Declaration, it is imperative to utilize the best and most efficient means to ensure continued operation of emergency power generators. If emergency power generation is allowed to expire on 28 November 2023, the main power generation facilities operated

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by the Puerto Rico power company would not be able to maintain a steady supply of power and resultant brownouts, blackouts, and long-term power outages would occur.

This would have immediate and significant effects to life/health/safety as well as the economic impact to the people of Puerto Rico. The political impact of losing uninterrupted power to the area would also be tremendous.

Puerto Rico’s System Average Interruption Frequency Index (SAIFI) is significantly higher than other U.S. utilities. Extended and frequent power outages (even outside of hurricane season) exact a heavy toll on the population and economy of Puerto Rico including:

• Loss of power to critical healthcare systems, loss of potable water services, loss of communications, loss of food refrigeration and medicine, and other impacts to critical infrastructure.

• Impact on Puerto Rico’s most vulnerable populations (people who are bedridden, with cold storage requirements, with dialysis or other home medical treatment needs, elderly, with low income, and isolated communities) tend to bear the brunt of these effects.

• LUMA Energy (LUMA) estimates that each power interruption event costs the economy of Puerto Rico $14M.

• The Federal Government has already allocated billions of dollars toward recovery from previous disasters. Although billions of dollars have been obligated under Hurricane Maria (2017), many energy projects are in the pipeline for engineering and approval, however, overall may take up to 10 years to complete. Currently, most of the obligated funds are aligned with transforming the transmission and distribution networks and not on the generation component of the energy system.

6. Efforts to Obtain Competition: The recent Savannah District MATOC for Puerto Rico Power System Stabilization, Power Generation Services sought full and open competition.

a. Effective competition. The existing MATOC Task Order under the Unrestricted RDI MATOC was awarded on the basis of best value from 6 proposals in the MATOC pool. The Unrestricted RDI MATOC was awarded on a full and open competition basis.

These MATOCs provide contract vehicles that can be used for USACE to meet the challenges of the immediate, urgent, and emergency needs while facilitating competition.

b. Subcontracting competition. There is only one existing subcontractor (NFEnergy) in Puerto Rico for generator fuel (liquid petroleum natural gas) for the gas turbine generators that provide the power generation services. No other sources exist.

7. Actions to Increase Competition: USACE has already explored all practicable alternatives and no alternative contracting methods are available to meet the mission requirement in the available timeframe.

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NWO is mindful of the requirement in FAR 6.302 to request offers from as many potential sources as practicable under the circumstances. The underlying MATOC pool contracts were all awarded on a full and open competition basis and this action fulfills time-sensitive requirements needed to respond effectively to immediate, urgent, and emergency situations.

Future planning will be considered to establish full and open competition for Puerto Rico and like requirements.

8. Market Research: Market research for Task Order W9128F23F0065 was conducted in December of 2022 to determine the best course of action to fulfill the requirements made by the Presidential National Emergency Declaration. Due to the accelerated timeline and complexity of the requirement, it was determined that two options were best suited for success of this task: RDI Unrestricted MATOC and the RDI Small Business (SB) MATOC. The Government determined that the SB firms lack the experience and resources to execute the mission requirements in Puerto Rico. The complexity and amount of resources required may put SB at high risk of capital burden.

The project was estimated to take up over 70% of the RDI SB MATOC’s capacity and it was clear that attempting to utilize the SB RDI MATOC would strain the resources on any of the available SB and would use most of the remaining capacity on the MATOC.

As a result, the Government determined that issuing a request for proposal under the unrestricted RDI MATOC was the appropriate acquisition strategy.

9. Interested Sources: In this instance, the urgent need to extend the O&M services as soon as possible is of such unusual and compelling urgency that the Government would be seriously injured unless NWO modifies the Task Order to extend O&M services to 15 March 2024.

10. Other Facts: If emergency power generation is allowed to expire on 28 November 2023, the main power generation facilities operated by the Puerto Rico power company, will not maintain a steady supply of power and resultant brownouts, blackouts, and long-term power outages would occur.

USACE must provide an expeditious contracting solution to ensure prompt and comprehensive emergency operations to fulfill this critical emergency power generation requirement prior to the expiration of the current Omaha RDI emergency power contract on 28 November 2023. Effected communities will face significant life/health/safety and economic impacts if continued, uninterrupted emergency power generation is delayed.

a. Procurement history:

(1) Contract numbers and dates of all awarded contracts for these same requirements: W9128F20D0005 W9128F23F0089 – 10 Apr 2023. Previously awarded task orders similar in nature for power generation in Puerto Rico were W9128F-14-D- 0024 W9128F18F0002 - 8 Oct 2017, and W9128F-14-D-0034 W9128F18F0016 – 7 Nov 2017.

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(2) The competitive status of these actions: Fair opportunity provided under RDI

MATOC.

(3) Authority previously cited if less than full and open competition was used. RDI MATOCs were competed on a full and open competition basis to award the MATOC contracts: Orders were subsequently placed under the full and open competed

MATOCS.

(4) If a justification was prepared to support the procurement made before this one, a summary of the contents of paragraph 7 of the justification for that procurement and an explanation of the results: N/A. No justification was prepared as the previous actions were considered within scope of the RDI MATOCs and within scope of the task orders.

(5) If any prior contract for this requirement was accomplished using full and open competition, include a detailed explanation of the changed circumstances causing this action to now limit the sources: Previous requirements were orders issued under FAR Part 16 ordering procedures awarded under full and open competed MATOC contracts.

The current orders were also placed in the same fair opportunity process. Now, this task order is being extended for the O&M (service) portion of the task order creating a shift in the preponderance of the task order to O&M services.

(6) An explanation of any unusual patterns that may be revealed by the history, e.g., several consecutive, urgent buys: Hurricanes continue to decimate Puerto Rico and cause significant damage to the power grid and power generation capabilities.

FEMA requests assistance from the USACE area of responsibility (AOR) responsible to provide emergency power. With no other solutions to provide FEMA/Puerto Rico with emergency power, agencies turned to Omaha and the RDI contract vehicle for emergency power production in Puerto Rico after hurricanes Maria in 2017 and Fiona in 2022. As power outages cause significant life/health/safety concerns, creating an urgent need for emergency power generation and stabilization of the power grid, urgent procurements are generated.

(7) If a justification was prepared to support the procurement made before this one, briefly describe the circumstances justifying the procurement and whether there have been any significant changes: No justification for previous procurements was made.

b. Other facts. This procurement (modification to an existing task order to continue temporary power generation) was contemplated to be transferred to a Puerto Rico specific power production task order under a Savannah District MATOC that was significantly above the budgeted amount available from FEMA. Furthermore, the action was protested making the award under the Savannah Puerto Rico Power Generation MATOC vehicle untenable. Since the current temporary power construction/generation task order was schedule to end on 28 Nov 2023, less than two weeks prior to the end of the current Omaha RDI construction/power generation task order, a dire/urgent need was created to find a solution to continue extended/uninterrupted power generation for

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Puerto Rico. There is not time to award another, separate full and open competed action nor time to adjudicate the Savanna task order solicitation and garner funding to conduct a CICA override and award on the Savannah solicitation. As market research revealed in the Omaha RDI task order solicitation/award, there are no other sources available to satisfy the requirement, especially given the short amount of time available to find a source to continue uninterrupted power production.

Control Number: CECT-NW -24-01

(Source Selection Information - See FAR 2.101 and 3.104-4)

CUI/SP-SSEL

11. Technical Certification:

I certify that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Signature: ________________________________Date: _______________________

Typed Name: Timothy P. Gouger Title: Rapid Response TCX Program Manager

12. Requirements Certification:

I certify that the supporting data under my cognizance, which are included in the justification, are accurate and complete to the best of my knowledge and belief.

Signature: ________________________________Date: ______________________

Typed Name: Gregory C. Herring Title: Supervisory Program Manager

13. Fair and Reasonable Cost Determination:

I hereby determine that the anticipated cost to the Government for this contract action will be fair and reasonable.

Signature: ________________________________Date: ______________________

Typed Name: John H. Tucker II Title: Branch Chief, Special Projects Branch

14. Contracting Officer Certification:

I certify that this justification is accurate and complete to the best of my knowledge and belief.

Signature: ________________________________Date: _______________________

Typed Name: John H. Tucker II Title: Branch Chief, Special Projects Branch

Digitally signed by

TUCKER.JOHN.HENRY.II.1102827

Date: 2023.11.17 22:06:08 -06'00'

Digitally signed by

TUCKER.JOHN.HENRY.II.1102827

Date: 2023.11.17 22:06:57 -06'00'

HERRING.GREGORY.C.123135

Digitally signed by

HERRING.GREGORY.C.1231350957

Date: 2023.11.18 09:53:57 -06'00'

GOUGER.TIMOTH

Y.P.1231351341

Digitally signed by

GOUGER.TIMOTHY.P.1231351341

Date: 2023.11.18 10:24:20 -06'00'