ATTACHMENT_4_EVALUATION_OF_OFFERS_FOR_BIOFUEL_BLENDS.pdf

Evaluation of Offers for BIOFUEL BLENDS

Application of the Biofuel Production Incentive (BPI) Evaluation Factor to F76 and JP-5

A Biofuel Production Incentive (BPI) evaluation factor will be applied to offers to supply F76 or JP5 containing a minimum of 5% blended biofuel to a maximum as permitted by specifications MIL-DTL-16884N and MIL-DTL-5624W respectively, and using a qualified feedstock or feedstocks listed in Attachment 5 to produce the biofuel used in the blended product. The BPI evaluation factor will be $0.100000 per gallon of F-76 or JP-5 fuel that contains a 5% biofuel blend and will increase by $0.010000 for every 1% biofuel content above 5% to a maximum evaluation factor of up to $0.250000. The BPI will be applied by subtracting that amount from an offeror’s price for evaluation purposes only in the Bulk Fuels Bid Evaluation Model (BEM). Offerors may submit multiple offers with different prices for varying biofuel content.

Small business set-aside match pricing will be determined by the BEM award pattern that includes the BPI evaluation factor for qualified small business offers ONLY. Any quantities designated for award to a small business under the Small Business Set-Aside price matching portion of the portion of the evaluation will be excluded from further consideration. The BPI evaluation factor will then be applied to all qualified offers and the BEM will be used to determine the award pattern. If the resulting award pattern yields a successful offeror evaluated with the BPI applied, the BPI will be removed from all the offers and the BEM will be used to determine the price that the Government would otherwise pay for fuel for each location in the solicitation, while preserving previously identified small business set-aside award quantities.

If a contract is awarded for a biofuel blend that uses CCC funds, the awarded contract price will be the offered price, which will be split into two contract line items. The first line item will be the price that DLA Energy would otherwise pay, based on the award pattern determined in the BEM run without the BPI included. The second line item will be the difference between that price and the offered price, and will represent the actual amount of BPI to be paid by the CCC. This BPI will be firm and fixed for the life of the contract, it will not escalate based on any market index.

$30,000,000.00 of CCC funds are available to support awards made to offerors eligible for the biofuel production incentive. The award pattern determined by the BEM will be reviewed to ensure that potential awards that include the BPI do not exceed the total available CCC funds.

Actual award quantities will be restricted to meet CCC funding limitations.

This BPI is not an additional sum to be paid over and above the offered price. The BPI will be applied as an evaluation factor as described above to determine if a biofuel blend offer will be eligible for award. After the award decision is made, the actual amount of the BPI to be paid by the CCC will be separately calculated and will cover only the portion of the total offered price that exceeds the price the Government would otherwise pay. In no event will an offeror be paid a price higher than its offered price. In the event that multiple offers are determined to have equivalent evaluated prices after evaluation factors are applied, the offer with the highest percentage of biofuel blend will be selected as eligible for award.

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ATTACHMENT 4

The Government reserves the right to remove from the competition at any time a biofuel offer that would be otherwise eligible for award but that does not meet all applicable statutory requirements, including those in 10 U.S.C. § 2922h. Under 10 U.S.C. § 2922h(a), absent a waiver, “the Secretary of Defense may not make a bulk purchase of a drop-in fuel for operational purposes unless the fully burdened cost of that drop-in fuel is cost-competitive with the fully burdened cost of a traditional fuel available for the same purpose.” If a contract for biofuel is awarded under this solicitation, it would qualify as a “bulk purchase of a drop-in fuel for operational purposes.” Therefore, in accordance with 10 U.S.C. § 2922h, a biofuel offer will be ineligible for contract award unless the fully burdened cost of the drop-in fuel is found to be cost competitive. The cost competitive analysis required by 10 U.S.C. § 2922h is fully separate from price evaluation in the Bid Evaluation Model (BEM), so that an offer that is evaluated in the BEM to be in line for award may not qualify as cost-competitive under 10 U.S.C. § 2922h.