Section_J_Attachment_13.docx

SECTION J, ATTACHMENT 13 (J-13)

DEFINITIONS OF APPLICABLE TERMS

Actual Energy Savings (Actual Savings). Amount of energy saved as calculated using the most current information available by the most economically feasible methods so as not to adversely burden additional costs for the project.

Ancillary Savings. Cost savings, other than energy cost savings, which directly result from the Contractor’s efforts to save energy costs, including but not limited to operation, maintenance, repair, and environmental remediation cost reductions directly related to the system being modified. Capital cost procurement avoidance can not be included as Ancillary Savings unless it is included and funded in the budget for the facility.

Estimated Cost. Estimated cost shall be the direct costs (without Contractor markups) that will be incurred by the Contractor to implement the Energy Cost saving Measure (ESCM), starting at the time of ECM award; plus the estimated and negotiated approved cost to perform the feasibility study and the design. The estimated costs for the feasibility study and design shall be submitted and approved by the Government prior to performing the work. See FAR Parts 2 and 31 for definition and discussion of direct costs and unallowable costs. FIRMS WHICH ARE WHOLLY OR PARTLY OWNED BY THE CONTRACTOR OR THE CONTRACTOR’S PARENT COMPANY SHALL NOT BE CONSIDERED SUBCONTRACTORS AS THE TERM RELATES TO ESTIMATED COST.

Total Estimated Cost. The total cost of the ECM(s) or project after the application of the Contractor markup to the appropriate Estimated Cost.

Capital Cost. The one-time setup cost of a plant or project, after which there will only be recurring operational or running costs.

Data Item Description (DID), DD Form 1664. These forms are attached to this contract as Attachment J-19. These forms are referenced throughout the contract and contain the instructions for preparation of the data required to be submitted. Refer to Attachment J-14 for timing and quantities of DID submittals.

Energy Conservation Measures (ECM) means measures that are applied to an existing Federally owned building or facility that improves energy efficiency, are life-cycle cost-effective, and involves energy conservation, water conservation, cogeneration facilities, renewable energy sources, improvements in operation and maintenance efficiencies, or retrofit activities.

Energy Cost Savings means a reduction in the cost of energy and related operation and maintenance expenses, from a base cost established through a methodology set forth in an energy savings performance contract, utilized in an existing federally owned building or buildings or other federally owned facilities as a result of—

(1) The lease or purchase of operating equipment, improvements, altered operation and maintenance, or technical services; or

(2) The increased efficient use of existing energy sources by cogeneration or heat recovery, excluding any cogeneration process for other than a federally owned building or buildings or other federally owned facilities.

Finance Charges. Finance charges are the contractor's costs of financing the estimated cost of an ECM. The contractor shall propose (in Attachment J-17) a maximum, fixed, annual percentage rate, that when added to the Treasury Bill/Treasury Constant Maturity 10 year interest rate will be the total percentage finance charge.

Guaranteed Energy Savings (Guaranteed Savings). Amount of savings the contractor guarantees will be generated as long as the contract is valid and the stated conditions are met. Guaranteed energy savings are typically at or less than verified energy savings.

Installation. Used as a noun, the military facility, federal and state (if applicable) government facilities, included in their entirety, to which this contract pertains. The terms “post” and “base”, when used as nouns, may also be used in place of “installation”.

Markup. The maximum of difference between the Contractor’s proposed payment and the combination of the amortized estimated cost and O & M costs of the ECM. (Direct costs X Markup = Proposed Price) The markup shall include: indirect labor; overhead costs; sales, general and administrative expenses; Prime Contractor markup of subcontractor-supplied equipment, material, or labor; profit to the Contractor; and other costs that are not directly attributable to the project. The markup may be negotiated to a lower rate than identified in Attachment J-17 at the time of task order award. Indirect labor shall include any salaries that cannot be directly attributed to a specific task and therefore must be distributed across several tasks or projects. Indirect labor shall be included in overhead. These costs shall not be recovered by the Contractor except through the percent markup. The markup shall not include estimated costs, O&M costs, and finance charges.

FIRMS THAT ARE WHOLLY OR PARTLY OWNED BY THE CONTRACTOR OR THE CONTRACTOR’S PARENT COMPANY SHALL NOT BE CONSIDERED SUBCONTRACTORS AS THE TERM RELATES TO MARKUP. This means only one markup will be applied to the sister company, parent, or other such relative and the contractor for this contract.

Operation and Maintenance (O&M) Costs. O&M costs shall be the estimated direct cost for operation and maintenance (e.g., direct labor, material, and spare parts). Estimated O&M costs shall not include costs which are included in the estimated cost, markup, and finance charges.

Sharing Basis. The proposed contractor payment compared to the energy and ancillary savings generated by the ECM shall be the basis for the development of a cost savings sharing arrangement.

Technology Category. ECMs shall be categorized based on the type of system and equipment involved in the project. The technology categories are listed as CLINS in section B. The miscellaneous category shall be used for application where the ECMs are not identified by the other categories.

Verified Energy Savings (Verified Savings). Amount of energy calculated by the M&V process in accordance with the contract and task order for each ECM and total task order.

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