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Utilities

Contracting/Power Procurement

The mission of the Utilities Contracting Policy Office, Installation Support Policy Branch USACE's Office of the Deputy Commanding General for Military Programs, is to assist the Chief of Engineers, who is the Army Power Procurement Officer, in developing policy, standards, and procedures for the preparation and approval of contracts to buy and sell utilities services. It also maintains a continuing liaison with the Assistant Secretary of the Army, Department of Defense, and the Army Regulatory Law Office to provide recommendations for improving and expediting contracting procedures.

Assisting the Utilities Contracting Policy Office is the Installation Support Center of Expertise (ISCX) at the U.S. Army Corps of Engineers Engineering and Support Center, Huntsville, AL. This Support Center:

  • serves as the central point of contact for all Army acquisitions and sales of utilities services
  • monitors overall utility contracting practices and procedures and supervises the development of contract-related technical specifications
  • provides assistance during rate negotiations with utility companies and in the review of rates for special programs, and
  • provides technical assistance to the Army Chief of Staff for Installations Management (ACSIM) in their Army's utilities privatization program.

Acquisition of Utility Services

The policy/goals of the Army and the Corps of Engineers regarding the acquisition of utility services are to:

  1. obtain utility services from the most efficient provider taking into consideration reliability, efficiency and safety of the furnished services;
  2. promote competition and aggregation; and
  3. provide contracting choices to the installation commander during these times of resources downsizing. AR 420-41 is the regulation for the Acquisition and Sale of Utility Services.

Utility Rate Intervention and Litigation

The Regulatory Law and Intellectual Property Office, U.S. Army Legal Services Agency, is responsible for:

  • assisting the Chief of Engineers, the Deputy Army Power Procurement Officer, and the Huntsville ISCX on utility regulatory matters and for providing representation on behalf of the Department of the Army before Federal and State regulatory bodies in all cases and hearings relating to communications, transportation, electricity, gas, water, and sewer; and
  • providing consultation, advice and legal guidance to Army, DOD, and other Federal activities concerning regulatory law matters.

Modernization

The Utilities Modernization Program (UMP) focuses on those utility systems that are either exempt from privatization or pending exemption from privatization. Modernization, as part of the Department of Defense Recapitalization program, is defined as alteration of facilities to implement new or higher standards, to accommodate new functions, to increase the efficiencies of components or the overall system and to replace building components that are at or beyond their service life. Modernization may be required due to a new mission or a change of capacity requirements at a particular location. Modernization may be accomplished through any of the following:

  • Incremental upgrades or replacements of a facility over the facility service life
  • Full modernization or refurbishment of a facility at the end of its service life, or
  • Replacement of a facility at the end of its service life.

The expectation for a Utility Modernization project is to raise the utility performance to a level higher than original performance or design level. The primary focus of the UMP is on central energy plants, thermal distribution systems and water distribution systems.

Renewable energy utility systems will be considered when modernization or replacement is required for failing utility systems. The Army recognizes the need for more secure, dependable and reliable energy and water systems. Availability and economy of energy sources is primary to Installations development of UMP projects.

This program resulted in significant efficiency and cost savings, and thus contributed toward meeting energy reduction goals. Current UMP efforts are focused on utility systems that the Army is unable to privatize. UMP projects compete for funding resources in SRM programs based on the criteria below:

  • ISR cost estimates for bringing systems to Q1 level rating
  • Reported environmental (air or water) Notices of Violation (NOVs)
  • Impact on mission dependency due to changes in mission requirements
  • Energy savings, in terms of energy per square footage reduction, and water consumption reduction

Process

  • Installations define their own site-specific utilities modernization plan, which requires garrisons to identify non-privatized utility systems projects that have ISR ratings below satisfactory condition/quality levels. These utility systems will then be prioritized against established selection criteria.
  • After projects are prioritized by HQDA, they are entered into a POM budget cycle.
  • A UMP Support Team performs technical and economic evaluations. This may include site visits and assessments at selected installations, reviews of utility source availabilities, environmental regulations, visual inspections of plants and distribution systems, design reviews, utility options for modernizing the systems (e.g., building a new plant, decentralization, refurbishment), and project validation.

UMP projects must be entered in the Project Prioritization System (PPS). All utilities systems with Q4/Black and Q3/Red ratings must have a project or projects in PPS to bring the systems to Q1/Green.

  • Entries must include building number, building use description, energy/water savings calculations, ISR improvements, mission impacts, measurement and validation methodology, pre-project energy and water use baselines, project justification and impact if not constructed.
  • The project originator will update their projects in PPS whenever design status, scope and cost changes occur.
  • Projects no longer required will be cancelled.
  • Once funding is approved, projects cannot be substituted without the approval of HQ IMCOM.

Privatization

Utilities Privatization (UP) represents the Army's investment strategy to recapitalize the Army's utility infrastructure (electrical, natural gas, water and wastewater) and bring the utility systems up to current industry standards. The utility systems are privatized only where the life cycle costs across the contract term are economical. Utility systems are exempted if the costs are unfavorable for the Army or for security reasons. The current portfolio (as of 03 2013) of privatized systems is estimated to be a portfolio of $18-20 billion.

The Army's UP Program addresses both the Pre-Award and Post-Award aspects of Utility Privatization. The Army's UP processes are fully consistent and compliant with the Congressional, Department of Defense (DoD) and Department of Army (DA) Policy & Guidance. Responsibility for the execution of the Army UP Program is through the Office of the Assistance Chief of Staff for Installation Management (OACSIM). The OACSIM UP Program Manager coordinates all UP activities and represents the Army in communications with Program Stakeholders and Points of Contact throughout the Army and DoD.

Additional Resources

ENERGY STAR®

FEMP Final Rule, 13 March 2009. This final rule covering the Federal procurement of energy-efficient products updates 10 CFR 436.

EISA 2007 requires Federal agencies to:

  • minimize standby energy use in purchases of energy-using equipment and to buy products with one watt or less of standby power when possible
  • focus on ENERGY STAR®-qualified and FEMP-designated products

EPAct 05, Section 104 states that agencies should select, where life-cycle cost-effective, ENERGY STAR and other energy efficient products when acquiring energy using products.

  • ENERGY STAR — the symbol for energy efficiency (U.S. Environmental Protection Agency) — ENERGY STAR labeled products use less energy than other products, save money on utility bills, and help protect the environment.

Procurement of ENERGY STAR® Products

  • Buying Energy Efficient Products — Federal Energy Management Program — Recommended efficiency levels, Federal supply sources, cost-effectiveness examples, and other buyer aids for commonly purchased products.
  • The Defense Logistics Agency and the General Services Administration are sources of lighting products for the Federal sector. These web-based catalogues offer a wide variety of efficient lighting products (lamps, bulbs, ballasts, and fixtures). In addition DLA provides weapon system lighting products for all of its DOD customers.

Renewable Energy

The Army needs to satisfy multiple goals and constraints while securing its energy supplies — focusing upon procurement of the lowest-cost energy that meets high reliability standards and minimum vulnerability to interruption from natural or intentional causes. Overlaid on this challenge is the need to comply with a series of statutes and policies as summarized below. These include:

  • Energy Policy Act of 2005 (EPAct 2005) Section 203. This law mandates the minimum contribution of renewable energy to an installation's total electricity consumption. The targets are:
    • 3% FY 2007 through FY 2009
    • 5% through FY 2012, and
    • Not less than 7.5 % beginning FY 2013.
  • In addition, proposed legislation, Senate Bill 1321, would increase these goals to 10% by FY 2010 and 15% by FY 2015. Although the bill has become law as the EISA, the renewable energy provisions were not included in the final version. It is likely this provision will be reintroduced in energy legislation in the next Congress.
  • The National Defense Authorization Act (NDAA) of 2007. The NDAA 2007 codifies DoD's voluntary goal of 25% of all energy consumed by 2025, but doesn't include any interim targets.

Water Resource Management

Authority

Section 432 of the Energy Independence and Security Act of 2007 (EISA) amends section 543 of the National Energy Conservation Policy Act, by adding a new subsection (f) Use of Energy and Water Efficiency Measures in Federal Buildings (42 U.S.C. 8253(f); referred to as "the statute" in this guidance). The new subsection prescribes a framework for facility energy project management and benchmarking, including the following elements /

  • Designated "facility energy managers" for ensuring compliance of "covered-facilities" subject to the requirements;
  • "Comprehensive energy and water evaluations"
  • Implementation of identified efficiency measures
  • Follow-up on implemented efficiency measures
  • Web-based tracking system of covered facilities' energy use, evaluations, projects, and follow-up
  • Benchmarking
  • Summaries of agency implementation status in Office of Management and Budget (OMB) Scorecards.