JUSTIFICATION AND APPROVAL FOR USE OF OTHER THAN FULL AND OPEN COMPETITION

Request Feasibility Study (FS) prior to Design/Implementation for Utility Energy Service Contract (UESC) for Steam Decentralization at NSA Mechanicsburg Philadelphia Navy Yard Annex (PNYA) The feasibility study is necessary prior to the design/implementation of a UESC project at PNYA. Specifically, PNYA has requested NAVFAC Mid-Atlantic’s assistance with a UESC project with PGW. This UESC project, pursuant to 10 U.S.C. § 2913(d), will involve the reduction of energy consumption at twenty five (25) Navy buildings at PNYA. This reduction in energy consumption will be accomplished by removing these buildings from the current city-owned central steam system and by having PGW install a combination of localized heating solutions and associated Direct Digital Controls (DDC). All of these items together are hereinafter referred to as Energy Conservation Measures (ECM). These ECMs may include, but will not be not limited to, natural gas fired boilers for heating and domestic hot water requirements, and infrared heaters for open bay heating. The total area for this UESC project is approximately 1,359 KSF. As a part of this UESC project, PGW has agreed to provide, as an incentive and at no cost to the Government, a preliminary energy audit identifying potential ECMs, as well as financing (as such financing is authorized per 10 U.S.C. § 2913(d)). Specifically, PGW will advance financing costs for the design/implementation of the project, which will be repaid upon completion and acceptance of the project, over an agreed-to period (approximately 10 to 15 years). Improvements to these building heating and controls at PNYA are necessary, in order to improve system efficiency and provide a long-term solution to the PNYA system’s current maintenance and reliability problems. Further, as a result of the implementation of these ECMs, the Navy will be able to take advantage of lower rates for fuels other than steam. For example, the approved FY 2010 rate for steam purchased at PNYA was $55.94/MBtu, while the natural gas rate was $11.00/MBtu. Rough estimates of the conversion from steam to natural gas show a simple payback of four years, not including potential savings from installation and application of DDCs. Prior to the design/implementation of this UESC project, the Navy must procure a feasibility study, which is necessary to determine which ECMs are actually possible, cost effective, and will result in the savings that will ultimately pay for the UESC project. Specifically, as of this time, all the Navy has received is a preliminary energy audit of the PNYA facilities at issue, identifying potential ECMs (as discussed above). While this preliminary energy audit is of value and does provide information regarding this UESC project, a feasibility study is necessary in order to obtain very detailed, targeted information regarding the feasibility and costs pertaining to specific ECMs at PNYA. This feasibility study will provide the detailed “road map? for the ECMs and specific actions that will form the design/implementation of this UESC. The feasibility study is necessary prior to proceeding with the design/implementation of the UESC, and the feasibility study is thus a prerequisite for the necessary heating and control improvements to the above-referenced buildings at PNYA.