Notice of Intent - Sole Source ESPC III MATOC

The US Army Engineering and Support Center, Huntsville intends to seek approval from the Assistant Secretary of the Army (Acquisition, Logistics and Technology) under Federal Acquisition Regulations (FAR) Part 6.302-1 – only one or a limited number of responsible sources will satisfy agency requirements, for up to an additional 3 years ordering period under the current Energy Savings Performance Contracts (ESPC) Multiple Award Task Order Contracts (MATOCs) which will reach in the end of their ordering period in  May 2025. The MATOCs were issued under NAICS code 541330 – engineering services.  The firm-fixed priced MATOC was competitively solicited under W912DY-12-R-0046 and was awarded on 8 May 2015 to 14 contractors. An on-ramp resulted in 4 additional awards to small businesses on 26 Nov 2019. (One contract was closed leaving 17 active contracts). The total shared capacity for all ESPC III MATOC contractors is $1.5B (base plus option).  The Huntsville Center is currently working on the replacement contracts for these expiring contracts with the awards projected in August 2025 – solicitation date is pending acquisition strategy approval.  This 3-year extension from 07 May 2025 to 07 May 2028 will create an adequate ordering period overlap between the ESPC III MATOC and the new ESPC IV MATOC allowing those projects initiated and in development under the existing ESPC III MATOC to be awarded. This allows for the 18 to 24 month development of viable projects, leading to task order award. The current 17 contract numbers, award dates and contractors within this MATOC pool are –

W912DY-15-D-0039          8 May 2015          SitelogIQ Government Solutions

W912DY-15-D-0040          8 May 2015          AECOM

W912DY-15-D-0041          8 May 2015          Ameresco, Inc.

W912DY-15-D-0042          8 May 2015          Clark Energy Group (CEG) Solutions

W912DY-15-D-0043          8 May 2015          Constellation NewEnergy

W912DY-15-D-0044          8 May 2015          Energy System Group (ESG)

W912DY-15-D-0045          8 May 2015          Honeywell International Inc., Federal Systems Group

W912DY-15-D-0046          8 May 2015          Johnson Controls Government Systems

W912DY-15-D-0047          8 May 2015          NORESCO

W912DY-15-D-0049          8 May 2015          Schneider Electric Buildings America

W912DY-15-D-0050          8 May 2015          Siemens Government Technologies

W912DY-15-D-0051          8 May 2015          Southland Energy

W912DY-15-D-0052          8 May 2015          Trane US   

W912DY-20-D-0022          26 Nov 2019        CCI Group

W912DY-20-D-0026          26 Nov 2019        TLS-CES Services II

W912DY-20-D-0070          16 Mar 2020         CTI-OES JV

W912DY-20-D-0071          16 Mar 2020         Green Generation Solutions

The ESPC III MATOC provides projects which reduce energy and water consumption, with ancillary benefits of achieving facility improvements, improving the quality of life in the DoD, and ultimately reducing overall energy costs for the installations. Under an ESPC, the “Energy Savings Contractor” (ESCO) conducts a comprehensive energy audit for the Federal facility and identifies different energy conservation measures (ECMs) which are improvements made to one or more facilities on a federal installation to save energy, reduce consumption, and ensure energy resilience. In consultation with the installation, the ESCO designs and constructs a project that meets the installation’s needs and arranges the necessary third-party funding.

 Authorized under Section 155 of the Energy Policy Act of 1992 (P.L. 102-486), 42 United States Code (U.S.C.) § 8287 et seq., an ESPC is a multi-year contract between a Federal agency and an ESCO. As defined in 42 U.S.C. § 8287c, the term “energy savings performance contract” means a contract that provides for the performance of services for the design, acquisition, installation, testing, and, where appropriate, operation, maintenance, and repair, of an identified energy or water conservation measure or series of measures at one or more locations. Pursuant to 42 U.S.C. § 8287 and 10 C.F.R. § 436, Subpart B, the solicitation and award of ESPCs are limited to pre-qualified ESCOs (in this case existing ESPC III MATOC Awardees). Under an ESPC, the ESCO conducts a comprehensive energy audit for the Federal facility and identifies different ECMs it could undertake to make improvements to those facilities to save energy, reduce consumption, and ensure energy resilience. In consultation with the Federal facility or installation, the ESCO designs and carries out a project that meets the Government’s needs.

To accomplish this, 42 U.S.C. § 8287 authorizes an “alternative financing method” for ESPCs – in other words, agencies are not required to have appropriations upfront to pay the ESCO. Instead, the ESCO can “front” the costs of the ECMs via third-party financing. As such, an ESPC can be used to take advantage of private sector expertise and capital so that energy and water conservation goals can be achieved when appropriated funds are limited or unavailable. The ESCO is required to guarantee that the ECMs generate energy cost savings sufficient to pay for the project’s improvements to the installation’s facilities over the term of a task order. Each ESPC requires annual Measurement and Verification to validate the savings are obtained prior to paying the ESCO and their financier. The ESCO then is paid back over a fixed period of time from appropriations that would be used for the payment of energy expenses and related operation and maintenance expenses which would have been incurred without an ESPC.

ESPCs are more complex than traditional contracts due to their long-term duration of up to 25 years, the sophistication of energy saving systems, and the likelihood of changes in, or to the facility and how it is utilized over the long contract period that may affect project performance. The Measurement and Verification (M&V) process illustrates one aspect of ESPC complexity. It is a specialized and detailed field of engineering that is essential to ensuring that the project achieves guaranteed savings. Task Order (TO) development (i.e., project initiation to TO award) is unique in that it can range from 18-Months to 3-Years, depending on the size of the project, age of the facilities on the installation, availability of data on historical energy usage and consumption, and the complexity of energy conservation measures (ECMs) proposed.

This announcement is being issued to notify all responsible sources of the Huntsville Center’s intent.  Again, no solicitation will be issued by the Huntsville Center for this effort at this time.  As stated above there will be a new acquisition for an ESPC VI MATOC estimated at $3 billion forthcoming.  The replacement contracts have an expected award date of August 2025.  The issuance of the new solicitation will be dependent upon approval of the acquisition strategy by the Army Services Strategy Panel.  Responsible offerors may submit information to Ms. Lisa Steenburn, Contracting Officer at Lisa.L.Steenburn@usace.army.mil on or before 24 February 2024.