Amd 0007 RFI Group 6.pdf

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Request for Information – Group 6

1. Electricity Suppliers are licensed by State, Group 1 includes PA, NJ, MD. Suppliers that are not licensed in all 3 states cannot bid on Group 1. Can you please divide Group 1 into three groups by state?

a. Pricing group 1 is combined because of their specific consolidated billing requirements.

2. I have a question regarding the trade agreement certificate, specifically the certification that the in-product is a US-made or designated country in-product. The in-product meaning electricity, that is probably very easy certification to make. But are you implying that the upstream facility that is producing the electricity, a solar facility, that is also has to have a certification?

a. Yes. The Government requires certification that the CFE generating asset be Trade Agreement Act/Buy American Agreement Act compliant. Reference Section I.

3. Regarding Section 52.212-4 [Contract Terms and Conditions, (l) Termination]: Regarding termination, whether for convenience or other reasons, can you confirm that the DLA will be subject to pay any mark-to-market or liquidation damages should the supply contract be canceled after the supplier has entered in a long term PPA offtake agreement on the DLA’s behalf? We have seen this referenced in earlier Q&As as “See Amendment 2,” but are still unclear on this item.

a. Pursuant to FAR 52.212-4 (l) Termination for the Government’s convenience. The Government reserves the right to terminate this contract, or any part hereof, for its sole convenience. In the event of such termination, the Contractor shall immediately stop all work hereunder and shall immediately cause any and all of its suppliers and subcontractors to cease work. Subject to the terms of this contract, the Contractor shall be paid a percentage of the contract price reflecting the percentage of the work performed prior to the notice of termination, plus reasonable charges the Contractor can demonstrate to the satisfaction of the Government using its standard record keeping system, have resulted from the termination. The Contractor shall not be required to comply with the cost accounting standards or contract cost principles for this purpose. This paragraph does not give the Government any right to audit the Contractor’s records. The Contractor shall not be paid for any work performed or costs incurred which reasonably could have been avoided.

b. (m) Termination for cause. The Government may terminate this contract, or any part hereof, for cause in the event of any default by the Contractor, or if the Contractor fails to comply with any contract terms and conditions, or fails to provide the Government, upon request, with adequate assurances of future performance. In the event of termination for cause, the Government shall not be liable to the Contractor for any amount for supplies or services not accepted, and the Contractor shall be liable to the Government for all rights and remedies provided by law. If it is determined that the Government improperly terminated this contract for default, such termination shall be deemed a termination for convenience.

c. Exceptions to the RFP terms and conditions can be submitted with proposals in accordance with Section L.4.K.

4. Section B, Table 1: The “Total” volumes for New Build CFE and Retail Electricity do not equal the sum of the four pricing groups. Please explain.

a. Please refer to Amd. 0005

5. Section C(2)(a) states “CFE shall be supplied to the Government within the same hour in which it was generated.

The Contractor shall not supply, and the Government will not purchase, any quantity of CFE exceeding the Government’s total electricity requirement during each hour.” Question: While we understand that the Government will not pay for Bundled CFE within the hour when excess Bundled CFE was generated, can the excess Bundled CFE be “rolled forward” and counted towards the 35% annual Bundled CFE requirement?

a. No

6. Section C(3)(e): Since PJM subaccount invoices are published on a calendar month basis and account level billing is to be done on a meter read cycle, it is our understanding that the subaccount will be used to facilitate the accurate allocation of charges but that it is not the intent that monthly account level invoices be held up and billed on a calendar month basis. Please confirm.

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a. Invoices may be issued on the meter read cycle.

7. Section C(2)(g)(i)(3): We do not understand the 24/7 CFE supply reporting requirement. Is it meant to only capture the exact hours when generation matches load. Should intervals when generation is above load be reported? Is the measurement done at the account level or some more aggregated level? Can the Government provide a sample of how the reporting should be performed?

a. Yes

b. Measurement should be done at the Installation level

c. Reporting should be done annual basis. Refer to Attachment X, 24-7 CFE Reporting Example

8. Section C(2)(a) states “Starting with the end of the first instance of the rolling 12-month period in which the amount of CFE Production was less than the New Build CFE Net Annual Quantity defined in Section B, if the generating asset is not able to produce the New Build CFE Net Annual Quantity defined in Section B, Table 1 in any rolling 12-month period, the Government may terminate for cause.” Question: This clause is very punitive for a product that is relying on intermittent resources that are subject to weather and operational constraints.

“Oversizing” can be one lever for the supplier to manage the Bundled CFE volumetric risk, but there needs to be a defined cure or some further flexibility (such as a tolerance band) around the 35% requirement, rather than have the supplier risk of termination for cause over a 20-year agreement related to issues that may outside of their control. 20 years is a long time, and a lot of weather and operational outcomes are to be expected.

Termination for cause subjects the supplier to extreme risk. We suggest the Government consider a cure provision that allows the supplier to avoid the risk of termination for cause by providing replacement PJM Class 1 RECs as a cure of Bundled CFE shortfalls. Is this acceptable to the Government? If not, can the Government suggest an alternate cure for the Contractor to avoid termination for cause. We are happy to work with the Government to structure a cure that provides incentives for the supplier to meet the 35% bundled CFE requirement while avoiding the extreme outcome of termination for cause.

a. Reference Section H (3), Force Majeure

9. Section C(2)(d) states: The Contractor shall deliver all EACs necessary to meet the CFE requirements to each installation. Question: It is our understanding that the Contractor will retire the EACs on behalf of the Government rather than deliver the EACs to the Government. Please confirm the disposition of the EACs.

a. The Contractor shall retire the EACs on behalf of the Government.

10. FAR 52.212-1(Instructions to Offerors): The “Period for acceptance of offers” states that offeror agrees to hold the prices in its offer firm for 30 calendar days. It is our understanding from the information session held on 9/12/24 that the Government intends to enter into discussions with suppliers prior to making an award, therefore there should be no need to hold prices firm. Please confirm the Government’s intent to enter into discussions prior to award.

a. Reference Section L.6 Competitive Range. The Government intends to award without discussions with Offerors (except clarifications as described in FAR 15.306(a)). Therefore, each proposal should be submitted on the most favorable terms to the Government. The Government reserves the right to conduct discussions if discussions are later determined by the Contracting Officer to be necessary.

11. FAR 52.212-1(Multiple offers): “Offerors are encouraged to submit multiple offers presenting alternate terms and conditions”. Will the government consider a non NEPA compliant offer?

a. Please refer to Section M.6(A), Completion of National Environmental Policy Act analysis requirements. A decision document must be signed prior to the construction of the CFE generating assets.

12. Exceptions to Terms and Conditions (Section L - L.4 Format Paragraph K): during the interview we understood that in order to submit alternate proposals we had to request an exception through a specific form prior submission. Is the process for submitting an exception as described on page 66, meaning that we only have to include in our final submission a table listing proposed exceptions? FAR 52.212-1 (Contract award): “The Government intends to evaluate offers and award a contract without discussion with offerors.” It is our understanding from the information session held on 9/12/24 that the Government will engage in discussions with suppliers before making an award.

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a. The Government reserves the right to conduct discussions as determined by the Contracting Officer to be necessary.

13. FAR 52.212-4 (Termination for the Government’s convenience): This section lacks sufficient detail to adequately describe the cost that the Contractor would incur should the Government terminate the contract. The contractor will be exposed to significant costs in liquidating the upstream renewable project should the Government choose to terminate for convenience. Is it the Government’s expectation that the Contractor would be paid all costs associated with liquidating the upstream renewable asset should the Government invoke this clause. Normal commercial contracts do not allow for termination for convenience, so this is a novel circumstance.

a. Reference Section 52.212-1 (e). Multiple offers. Offerors are encouraged to submit multiple offers presenting alternative terms and conditions, including alternative line items (provided that the alternative line items are consistent with FAR subpart 4.10), or alternative commercial products or commercial services for satisfying the requirements of this solicitation. Each offer submitted will be evaluated separately.

b. Pursuant to FAR 52.212-4 (l) Termination for the Government’s convenience. The Government reserves the right to terminate this contract, or any part hereof, for its sole convenience. In the event of such termination, the Contractor shall immediately stop all work hereunder and shall immediately cause any and all of its suppliers and subcontractors to cease work. Subject to the terms of this contract, the Contractor shall be paid a percentage of the contract price reflecting the percentage of the work performed prior to the notice of termination, plus reasonable charges the Contractor can demonstrate to the satisfaction of the Government using its standard record keeping system, have resulted from the termination. The Contractor shall not be required to comply with the cost accounting standards or contract cost principles for this purpose. This paragraph does not give the Government any right to audit the Contractor’s records. The Contractor shall not be paid for any work performed or costs incurred which reasonably could have been avoided.

c. (m) Termination for cause. The Government may terminate this contract, or any part hereof, for cause in the event of any default by the Contractor, or if the Contractor fails to comply with any contract terms and conditions, or fails to provide the Government, upon request, with adequate assurances of future performance. In the event of termination for cause, the Government shall not be liable to the Contractor for any amount for supplies or services not accepted, and the Contractor shall be liable to the Government for any and all rights and remedies provided by law. If it is determined that the Government improperly terminated this contract for default, such termination shall be deemed a termination for convenience.

d. Exceptions to the RFP terms and conditions can be submitted with proposals in accordance with Section L.4(K).

14. FAR 52.225-5 (Trade Agreements): Is compliance with FAR 52.225-5 a hard requirement of the solicitation?

This clause may limit the breadth of projects that are available to source this solicitation. Is the Government open to alternate proposals that do not comply with FAR 52.225-5?

a. Reference Section 52.212-1 (e). Multiple offers. Offerors are encouraged to submit multiple offers presenting alternative terms and conditions, including alternative line items (provided that the alternative line items are consistent with FAR subpart 4.10), or alternative commercial products or commercial services for satisfying the requirements of this solicitation. Each offer submitted will be evaluated separately.

b. Exceptions to the RFP terms and conditions can be submitted with proposals in accordance with Section L.4(K).

15. NEPA Compliance: The NEPA process is a thorough review conducted by a federal agency to study the economic, environmental, and social impact of a project and can usually take up to 1-3 years. There are different classes of action: Environmental Impact Statement, Environmental Assessment and Categorical Exclusion; and the scope of the impact statements seems to vary project by project. How does DLA envision the NEPA process for this RFP? On page 73, it is mentioned that the retail supplier shall provide copies of available studies related to environmental considerations. Does it mean that providing such third-party environmental studies would make the upstream renewable asset NEPA compliant? Could the DLA detail more precisely how they will judge if an asset is NEPA compliant?

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a. The Government requires a favorable NEPA decision document prior to construction and contract award. Exceptions to the RFP terms and conditions can be submitted with proposals in accordance with Section L.4(K).

b. Having existing studies already accomplished may expedite the process. However, the Government will need to evaluate the documents.

16. The Executive order states 100% CFEC’s by 2030. How is the DLA planning to reach that goal in 5 years with the current 65/35 model?

a. To meet the 100% CFE goal of 2030, we are only requiring ~35% as the Government anticipates the other 65% will be other contributions from Grid Supplied CFE.

17. Argonne National Laboratory is listed in the 12 Month DLA RFP SPE60424R0408; however, it is not listed in the DLA 20 Year RFP SP060424R0421. Will it be included in RFP SP060424R0421?

a. Argonne National Laboratory was removed from the solicitation.

18. Will the start date of the contract be the same as the expected COD (Commercial Online Date) of the new build CFE projects?

a. No. The targeted CFE/Retail Electricity SP060424R0421 period of performance is intended to commence at the contract expiration for SPE60424R0408. It will be the follow-on to the Retail Electricity, upon expiration of the retail electricity contract.

19. The majority of the renewable PPA marketplace transacts on virtual PPA (as generated fixed for floating) agreements rather than physical supply agreements, which helps to reduce the cost and complexity associated with incorporating into a traditional retail supply solution. Would the DLA consider Virtual PPA Agreements?

a. The Government does not intend to consider Virtual PPAs Agreements. Exceptions to the RFP terms and conditions can be submitted with proposals in accordance with Section made via In section L.4(K).

20. Question/Feedback on Process and Timeline: The current offer due date is 11/4/24. Given that the DLA is in the process of securing a one year “bridge” agreement through December 2025, we recommend that the offer due date be reconsidered for the following reasons: (1) Allow time for DLA to fully respond to the questions that are submitted by the 9/23/24 deadline and for suppliers to fully digest the responses to the questions and craft offers accordingly. (2) There is an ongoing Bundled CFE solicitation in PJM through GSA. Suppliers will be leveraging an overlapping inventory of new build PJM projects for both solicitations. Currently both the DLA solicitation and the GSA solicitations are due in early November 2024. Suppliers are basing the milestone dates and pricing that they quote in their offers based on the inventory of available assets at the time they make the offer. We recommend that GSA and DLA coordinate process and timelines so that suppliers are not put in a position of having to pull offers based on the outcome of each solicitation. Perhaps a linear process and timeline rather than a parallel process and timeline between the two solicitations would be beneficial. Question: Do you expect changes to the schedule for offer submission?

a. Please refer to Amd 0006. The deadline for proposal submission is extended to 20 Dec 2024.

b. Per Section L.1 Inquiries by Offerors, Questions and requests shall be entertained up to November 6th,

21. Is our technical response AND pricing both due on the 20th? Or just the technical piece?

a. Technical and price proposals are due 20 Dec 2024.