Attachment 10 - BEM Overview 2025.pdf
PDF 3 MB Posted
- Attached to
- Rocky Mountain/West Coast Program
- Solicitation number
- SPE60226R0702
- Issued by
-
Defense Logistics Agency Energy
About this file
This document is a presentation describing the Bulk Bid Evaluation Model (BEM), a procurement evaluation tool used by the Defense Logistics Agency (DLA) for large-volume petroleum product contracts.
The BEM is a mixed-integer linear optimization program designed to determine the minimum laid-down cost for bulk petroleum procurements. Bulk petroleum procurement is characterized by large volumes, high dollar values, estimated quantities with a 75% minimum lift guarantee, awards on FOB Origin and FOB Destination bases, and extensive use of commercial distribution systems. The model evaluates offers across multiple dimensions including offered product price, transportation costs, additive costs, storage and onward distribution costs, fixed and variable costs, and excess throughput charges. The model accommodates offer-specific conditions such as volume restrictions, multiple transport/delivery modes, injection capabilities, tiered/block pricing, and either-or/one-before-two conditional statements. For domestic procurements, the evaluation process incorporates socio-economic considerations including 8(a) reservations, HUBZone Premium Program participation, and small business set-asides with price matching provisions.
The evaluation process follows a structured sequence consisting of initial offers (Round 1), interim offers (Round 2) with minimum cost bid evaluation, final offers (Round 3) with minimum cost bid evaluation and laid-down cost reports, and a price reduction round. The model then executes sequential runs in order: Base Run, 8(a) Run, HUBZone Run, Small Business Set-Aside Run, Final Forced Run, and Optimization Run. The document includes sample output reports showing minimum cost solution evaluation sheets and laid-down cost reports demonstrating how the model allocates quantities across multiple vendors and delivery points. Questions regarding BEM functionality should be directed to Sean.Lucas@dla.mil.
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Text version
Bulk Bid Evaluation Model (BEM)
Sean Lucas February 2025
WARFIGHTER ALWAYSPEOPLE PRECISION POSTURE PARTNERSHIPS
Bulk Petroleum Procurement Characteristics
2 of xx
• Procurement of large volumes of petroleum products
• Large dollar value contracts
• Estimated quantity with high minimum lift guarantee (75%)
• Awards on FOB Origin and FOB Destination Basis
• Extensive use of commercial distribution systems
• Distribution may be direct to point of demand or through intermediate terminal(s)
• Socio-Economic considerations (Domestic Procurements only):
• 8(a) Reservations
• HUB Zone Premium Program
• Small Business Set-asides (Price Matching)
Offer Conditions
Bid Evaluation Model (BEM)
3 of xx
• Optimization program (mixed-integer linear evaluation) used to find the minimum laid down cost for the procurement.
• Laid Down Cost considers:
• Offered product price
• Transportation costs
• Additive costs
• Storage/onward distribution costs
• Fixed costs
• Variable costs
• Excess throughput charges
• Offer specific evaluation factors
• Base Reference Price evaluation factors
Bid Evaluation
Model
Volume Restrictions
Multiple Transport /
Delivery Modes
Injection Capability
Tiered / Block Pricing
Either or / One before
Two
* Conditional statements must not conflict with one another (i.e., minimum award by mode exceeds overall maximum award volume)
CUI
CUI
(Offered Price vs. Laid Down Cost)
Evaluation Visual
4 of xx
Requirements Base 1: 3,000,000 gallons received by TT Base 2: 3,000,000 gallons received by TT Base 3: 1,000,000 gallons received by TT
Intermediate Depot Support Available Into X by PL, out by TT to all Requirements Into Y by PL, out by TT to all Requirements
PL = Pipeline; TT = Tank Truck
Offer A
6,000,000 USG @ $2.95
Offer C
1,000,000 USG @ $2.98
Offer B
6,000,000 USG @ $3.00
Intermediate Terminal X
Intermediate Terminal Y
Requirement 3
1,000,000 USG
Requirement 2
3,000,000 USG
Requirement 1
3,000,000 USG
.28
.02 .05
.01
.02 .05.02
.04
.02
.04
.20
.23
.06
Req 1 – Offer A (total cost $3.23/gal) Req 2 – Offer A (total cost $3.15/gal) Req 3 – Offer C (total cost $3.04/gal)
Total cost: $22,180,000
Req 1 – Offer B (total cost $3.06/gal) Req 2 – Offer C (total cost $3.01/gal) Req 2 – Offer B (total cost $3.04/gal) Req 3 – Offer B(total cost $3.04/gal)
Total cost: $21,310,000 ($870,000)
Evaluated on Offered Price Only: Evaluated on Laid-Down Cost:
CUI
Evaluation Rounds
Bid Evaluation Model (BEM)
5 of xx
INITIAL OFFERS
ROUND 1
INTERIM OFFERS
ROUND 2
FINAL OFFERS
ROUND 3
PRICE REDUCTION
ROUND
Minimum Cost Bid Evaluation Sheet
Minimum Cost Bid Evaluation Sheet & Laid Down Cost Report
CUI
Minimum Cost Solution Evaluation Sheet
6 of xx
CUI
Laid Down Cost Report
7 of xx
CUI
Model Sequence
8 of xx
Small Business Set-Aside Run
HUBZone Run
8(A) Run
Base Run
Optimization Run
Final Forced Run
CUI
Contact Information
9 of xx
For questions concerning the functionality of the Bulk Bid Evaluation Model (BEM) please contact:
Sean.Lucas@dla.mil
File details come from the government source that posted it. Updated .