JOTFOC_FAR-6_Sole_Source_4-2021_Signed_Redacted.pdf

Solicitation Number: 140R2026Q0003 Page 1 of 7

WBR 1406.303-1 Template 1 eFile - B02

(04/2021)

JUSTIFICATION AND APPROVAL FOR OTHER THAN FULL AND OPEN

COMPETITION

In accordance with FAR 6.302 or FAR 13.501(a), the proposed contractual action is pursuant to the statutory authority identified in paragraph 4. This template is required for actions over the Simplified Acquisition Threshold (unless the procurement is acquired as a limited source IAW FAR 8.405-6 or is an Exception to Fair Opportunity IAW FAR 16.505(b)(2)).

1. Agency and Contracting Activity (FAR 6.303-2(b)(1)).

U.S. Department of the Interior, Bureau of Reclamation California Great Basin, Acquisition Services Sacramento, CA 95825

2. Nature/Description of Action (FAR 6.303-2(b)(2)).

The is a firm-fixed-price, sole-source procurement using Fiscal Year 2024 Infrastructure Investment and Jobs Act (IIJA) funds to acquire exclusive services from L&S Electric Inc. for upgrading the main unit governors and two (2) station service governors at the Shasta Power Plant.

The total estimated cost is , with an estimated delivery lead time of two (2) years from date of award.

3. Description of Supplies/Services (FAR 6.303-2(b)(3)).

The overall purpose of this procurement is to supply and commission new equipment and software—including relevant training and operations and maintenance (O&M) manuals—to upgrade the aging digital governors at the Shasta Powerplant. The contract includes the provision of seven (7) Programmable Logic Controller (PLC)-based digital governor retrofit kits, proprietary software for digital governor control, customization of that software, training, O&M manuals, and commissioning support for all units.

Installation of the new equipment will be performed by project staff.

This Justification and Approval (J&A) addresses the procurement of customized equipment, parts, and services related to the proprietary software, as well as on-site commissioning of the customized system and training for Shasta Dam personnel in the operation, maintenance, and troubleshooting of the governors following completion of customization and commissioning.

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(04/2021) understood and integrated to minimize the risk of inadvertent operations, ensure safety, and protect life and property.

(2) Project Background: A local value planning was conducted on this project. 4 alternatives were reviewed. -

a. Do nothing

b. Buy spare parts

c. Retrofit all units and replace critical components with an alternate governor supplier and programmer

d. Upgrade the existing governors using the L&S retrofit kits. This will modernize the digital governors and ensure compatibility with the proprietary software.

The Government and project team cannot pursue Alternative A due to the age and deteriorating condition of the existing equipment, which presents an unacceptable risk of failure. In the event of an outage, automated control of the turbines in the powerhouse would be lost, resulting in a cessation of electricity generation and adverse impacts on the electrical grid.

Alternative B was also eliminated due to the unavailability of spare parts.

Alternative C was deemed unfeasible because the cost of implementing a different system would be higher, particularly when considering the technological background and integration requirements. While the mechanical and physical components of the governor equipment are not proprietary to L&S Electric Inc., the governor software is proprietary.

L&S Electric Inc. will only provide their proprietary software, customization services, commissioning, and training if the mechanical and physical components are also supplied by their company. This approach is standard in the industry due to the integrated nature of electro-mechanical equipment controlled by PLC-based digital systems.

(3) Justification: The purchase of powerhouse governor modernization including software customization and training from the same integrator is required for several key reasons:

a. National Security and System Resilience:

Hydroelectric dams are part of the nation’s critical infrastructure, and as such, there is heightened responsibility to ensure system security and operational resilience. Procuring the same parts, software, and software customization from the original integrator ensures compatibility with existing systems that have

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(04/2021) already been tested and proven reliable. This approach minimizes cybersecurity risks and supports the continued resilience of the power generation infrastructure.

b. Operational Efficiency and Workforce Familiarity:

The project is already equipped with L&S Electric Inc. governors and associated software. Project personnel have been trained in their operation and maintenance and have experience installing and supporting these systems. Continuing with the same vendor is both logical and cost-effective, as it avoids retraining, reduces integration risks, and leverages existing institutional knowledge.

c. Proprietary Software and Industry Practice:

While the mechanical and physical components of the governor equipment are not proprietary to L&S Electric Inc., the control software is. L&S Electric Inc. does not provide commissioning or training services for their proprietary software if the mechanical components are supplied by another firm. This is standard industry practice due to the tightly integrated nature of electro-mechanical systems controlled by PLC-based digital platforms.

d. Reduced Downtime and Cost Avoidance:

An Original Equipment Manufacturer (OEM) retrofit using L&S Electric Inc.

components would require only a short outage per unit, which can be scheduled during normal maintenance windows. In contrast, switching to an alternative manufacturer would necessitate a full system conversion, resulting in extended outages of at least two months for installation and commissioning. This would significantly increase costs and reduce plant availability and generation revenue.

(4) Impact: The replacement of the existing governors is essential, as they are either failing or approaching the end of their expected service life of 20–25 years. Without timely replacement, component failures will increase, leading to extended outages as units are taken out of service for repairs. Additionally, the availability of spare parts has significantly declined, resulting in longer downtimes and increased operational risk.

In a blackout scenario, the failure of one or both station service governors could prevent the restart of the powerhouse, posing a serious threat to system reliability and grid stability.

Given these risks, it is critical that L&S Electric Inc. provide the required services for this acquisition. L&S Electric Inc. is the only source capable of delivering the proprietary software customization, integration, and commissioning services necessary for compatibility with the existing system. It is also standard industry practice for the same firm that supplies the hardware to provide the associated integration and commissioning services, ensuring a fully functional and supportable end product.

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6. Description of efforts made to maximize competition (FAR 6.303-2(b)(6)).

Currently, L&S Electric Inc. is the only known source capable of providing the required proprietary software customization and integration services that are fully compatible with the existing digital governor equipment at Shasta Powerplant. The programming and software are proprietary to L&S Electric Inc., and the company does not license or authorize third parties to modify or support their software.

Market research conducted by the Program Office indicates that sole sourcing is a common industry practice for digital governor modernization due to the proprietary nature of each manufacturer’s software and control systems. Redesigning or replacing the existing digital governor system to enable competition would introduce significant risks to plant infrastructure, including reduced system security, diminished resiliency, and interoperability challenges across the division.

Additionally, the notice of intent to award sole source announcement number 140R2026Q0003 was posted on December 19, 2025, via SAM.gov for over 14 days. No response was received.

7. Determination of Fair and Reasonable Cost (FAR 6.303-2(b)(7)).

The results of the restricted competition, comparison of proposed prices will be determined fair and reasonable by the Contracting Officer based on techniques set forth in FAR13.106-3(a)(2)(i), market research, (ii), comparison of the proposed price with prices found reasonable on previous purchase, and (iv), comparison with similar items in a related industry.

8. Description of Market Research Conducted (FAR 6.303-2(b)(8)).

Market Research Conducted by Contract Specialist:

a. Verified previous contracts 04CP202034 and 04CC200022, which were issued for the purchase of the existing digital governors. L&S Electric Inc. was the vendor responsible for installing and programming the original software.

b. A search was conducted on the SBA’s Dynamic Small Business Search website using

NAICS code 221111, which resulted in three (3) small businesses and over 1,000 results using the keywords “automated control digital governors.” Although the search yielded many small businesses, this requirement involves upgrading the digital governor systems. Only L&S Electric Inc. can fulfill these needs because the originally installed software is proprietary to them.

Additional Market Research Conducted by the Program Office:

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a. The Program Office searched SAM.gov and found that the Department of the Army has issued sole-source acquisitions for this type of procurement.

b. The Program Office confirmed with the lead engineer at the Technical Service Center in the Denver office that a sole-source procurement is the only viable option to meet the Government’s needs for digital governor upgrades due to proprietary software issues.

c. The Program Office also verified with L&S Electric Inc., who confirmed that their control software was installed; therefore, they are the only firm capable of performing the necessary upgrades required by the Government. Each company utilizes proprietary software in the design and operation of their systems, which limits interoperability. As a result, it is more cost-effective for the Government to continue working with the original equipment manufacturer for modernization efforts rather than introducing a new system that would require full replacement and integration.

9. Any Other Supporting Facts (FAR 6.303-2(b)(9)).

None

10. Listing of Interested Sources (FAR 6.303-2(b)(10)).

L&S Electric Inc.

5101 Mesker St.

Schofield, Wisconsin 54476-0740

11. Actions Taken to Remove Barriers to Competition (FAR 6.303-2(b)(11)).

This Justification and Approval supports a discrete, one-time requirement that will conclude upon completion of the services. Therefore, there are no planned actions to increase competition for this specific procurement. However, the Government will continue to consider alternative sources for future requirements, particularly when full system replacement is feasible and competition can be pursued without compromising compatibility or operational integrity.