The Department of Defense issued 10 new contracts on Tuesday worth a combined $7.42 billion. One single award, however, ate up more than 94% of the funds on offer.
This contract, a massive $7 billion deal to supply wind energy "from renewable and alternative energy production facilities that are designed, financed, constructed, operated and maintained by private sector entities," involves some 17 separate companies. Taking the form of a multiple-vendor, indefinite-delivery/indefinite-quantity, firm-fixed-price, non-option, non-multiyear contract, it requires vendors will to bid against each other to sell wind energy to the U.S. Army in response to individual "task orders" issued by the U.S. Army Corps of Engineers.
Once won, a task order will be funded out of the $7 billion "pot" of funds allocated under this master Power Purchase Agreement. Bidders who won the right to compete for these task orders number 17, out of a total of 45 bids submitted. Most of the winners are either small, privately held concerns or small subsidiaries of foreign energy utilities whose stocks are not listed in the U.S. The few exceptions include U.S. listed major energy companies Dominion Resources (NYSE:D), Duke Energy (NYSE:DUK), Siemens (NASDAQOTH:SIEGY), and Canada's Toronto-listed NorthlandPower (TSX:NPI).
In both form and function, this contract announcement echoes a similar one -- also valued at up to $7 billion -- awarded late last month. That contract, however, concerned the supply of solar energy to the military and awarded 22 companies the right to bid against one another to fulfill task orders under it.
Among the winners of this current contract, Dominion and Siemens also won the right to participate in the earlier award for the provision of solar power to the military.
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