[Code of Federal Regulations]
[Title 48, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 48CFR41.201]

[Page 750-751]
 
            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM
 
                CHAPTER 1--FEDERAL ACQUISITION REGULATION
 
PART 41_ACQUISITION OF UTILITY SERVICES--Table of Contents
 
                 Subpart 41.2_Acquiring Utility Services
 
Sec.  41.201  Policy.


    (a) Subject to paragraph (d) of this section, it is the policy of 
the Federal Government that agencies obtain required utility services 
from sources of supply which are most advantageous to the Government in 
terms of economy, efficiency, reliability, or service.
    (b) Except for acquisitions at or below the simplified acquisition 
threshold, agencies shall acquire utility services by a bilateral 
written contract, which must include the clauses required by 41.501, 
regardless of whether rates or terms and conditions of service are fixed 
or adjusted by a regulatory body. Agencies may not use the utility 
supplier's forms and clauses to avoid the inclusion of provisions and 
clauses required by 41.501 or by statute. (See 41.202(c) for procedures 
to be used when the supplier refuses to execute a written contract.)
    (c) Specific operating and management details, such as procedures 
for internal agency contract assistance and review, delegations of 
authority, and approval thresholds, may be prescribed by an individual 
agency subject to compliance with applicable statutes and regulations.
    (d)(1) Section 8093 of the Department of Defense Appropriations Act 
of 1988, Pub. L. 100-202, provides that none of the funds appropriated 
by that Act or any other Act with respect to any fiscal year by any 
department, agency, or instrumentality of the United States, may be used 
for the purchase of electricity by the Government in any manner that is 
inconsistent with state law governing the providing of electric utility 
service, including state utility

[[Page 751]]

commission rulings and electric utility franchises or service 
territories established pursuant to state statute, state regulation, or 
state-approved territorial agreements.
    (2) The Act does not preclude--
    (i) The head of a Federal agency from entering into a contract 
pursuant to 42 U.S.C. 8287 (which pertains to the subject of shared 
energy savings including cogeneration);
    (ii) The Secretary of a military department from entering into a 
contract pursuant to 10 U.S.C. 2394 (which pertains to contracts for 
energy or fuel for military installations including the provision and 
operation of energy production facilities); or
    (iii) The Secretary of a military department from purchasing 
electricity from any provider when the utility or utilities having 
applicable state-approved franchise or other service authorizations are 
found by the Secretary to be unwilling or unable to meet unusual 
standards for service reliability that are necessary for purposes of 
national defense.
    (3) Additionally, the head of a Federal agency may--
    (i) Consistent with applicable state law, enter into contracts for 
the purchase or transfer of electricity to the agency by a non-utility, 
including a qualifying facility under the Public Utility Regulatory 
Policies Act of 1978;
    (ii) Enter into an interagency agreement, pursuant to 41.206 and 
17.5, with a Federal power marketing agency or the Tennessee Valley 
Authority for the transfer of electric power to the agency; and
    (iii) Enter into a contract with an electric utility under the 
authority or tariffs of the Federal Energy Regulatory Commission.
    (e) Prior to acquiring electric utility services on a competitive 
basis, the contracting officer shall determine, with the advice of legal 
counsel, by a market survey or any other appropriate means, e.g. 
consultation with the state agency responsible for regulating public 
utilities, that such competition would not be inconsistent with state 
law governing the provision of electric utility service, including state 
utility commission rulings and electric utility franchises or service 
territories established pursuant to state statute, state regulation, or 
state-approved territorial agreements. Proposals from alternative 
electric suppliers shall provide a representation that service can be 
provided in a manner consistent with section 8093 of Public Law 100-202 
(see 41.201(d)).

[59 FR 67018, Dec. 28, 1994, as amended at 60 FR 34759, July 3, 1995; 61 
FR 39190, July 26, 1996; 64 FR 10533, Mar. 4, 1999]