Chapter 26.2, EPACT Cost Sharing Requirements
[Reference: Energy Policy Act, Pub. L. 102-486; DEAR 926.70]
Overview
This section provides implementation guidance on sections 3001 and 3002 of the Energy Policy Act, (EPAct) 42 U.S.C. 13541 and 13542 for acquisition awards.
Background
Sections 3001 and 3002 provide general provisions covering the research, development, demonstration, and commercial application activities to be carried out under EPAct. Section 3001 authorizes the Secretary to carry out research, development, demonstration and commercial application programs through the use of contracts, cooperative agreements, grants, cooperative research and development agreements, and joint ventures.
It also extends the protection of information coverage of the Stevenson-Wydler Technology Innovation Act of 1980, 15 U.S.C. 3710 a(c)(7) to research, development, demonstration, and commercial application programs and activities under EPAct.
Section 3002 imposes cost sharing requirements for such activities. For research and development programs, the Secretary requires a commitment from non-Federal sources of at least 20 percent of the cost of the project.
For demonstration and commercial application programs, the Secretary requires at least 50 percent of the costs directly and specifically related to any demonstration or commercial application project to be provided from non-Federal sources.
The Secretary may reduce or eliminate the non-Federal requirement for cost sharing for research and development programs if the Secretary determines that the research and development is of a basic or fundamental nature.
For demonstration and commercial application programs, the Secretary may reduce the non-Federal requirement if the reduction is necessary and appropriate considering the technological risks involved in the project and the project is necessary to meet the objectives of EPAct.
In calculating the amount of the non-Federal commitment, cash, personnel, services, equipment, and other resources are included. Guidance
The requirements of Sections 3001 and 3002 apply to contracts for research and development, demonstration, and commercial application projects under an EPAct covered program which are made on or after October 24, 1992, the effective date of EPAct.
The Department of Energy has determined that programs executed under the authority of the Small Business Innovation Research and Small Business Technology Transfer programs are not covered under EPACT.
Contracting Officer Responsibilities
Contracting officers must include the following information in any solicitation for research and development, demonstration, and commercial application programs covered under EPACT:
(1) Protection of Information.
The provisions of Section 12(c)(7) of the Stevenson-Wydler Technology Innovation Act of 1980, relating to the protection of information, apply to research, development, demonstration, and commercial application programs and activities under this Act.
These provisions specify:
• The protection from public disclosure of trade secrets or financial or commercial information that is privileged or confidential and obtained in the conduct of research or as a result of activities under this Act from a non-Federal party to a covered contract. • The protection from public disclosure, for a period of up to five years from development, of information resulting from the contract that would be a trade secret or commercial or financial information that is privileged or confidential if the information had been obtained from a non-Federal party to a covered contract. This protection from public disclosure includes exemption from disclosure pursuant to 5 U.S.C. 552(b) (The Freedom of Information Act.)
The Contracting Officer coordinates with the DOE Patent Counsel prior to award of any contract covered under EPAct to assure appropriate intellectual property provisions.
In no event does the Contracting Officer construe the data protection provisions to apply to information or data generated by M&O contractors under their prime contract with the Department. (2) Cost sharing requirement.
Contractor proposals must show the requisite cost sharing commitment. The following is suggested language which may be used in solicitations and resulting contracts.
Cost Sharing Requirement
EPACT 3002 requires a cost sharing commitment of 20 percent from non-Federal sources for research and development projects. For demonstration or commercial application projects, the cost sharing requirement from non-Federal sources is 50 percent. Your cost proposal must show the breakout between Federal and non-Federal sources and how you propose to meet the cost sharing requirement. The non-Federal share may include cash, personnel, services, equipment, and other resources.
All cost sharing or matching contributions, including cash and third party in-kind, shall meet the following criteria: (1) are verifiable from the contractor's records, (2) are not included as contributions for any other federally-assisted project or program, (3) are necessary and reasonable for proper and efficient accomplishment of project or program objectives, (4) are allowable under the applicable cost principles, (5) are not paid by the Federal Government under another award, except where authorized by Federal statute to be used for cost sharing or matching. Values for contractor contributions of services and property shall be established in accordance with applicable cost principles.
Volunteer services furnished by professional and technical personnel, consultants, and other skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral and necessary part of an approved project or program. Rates for volunteer services shall be consistent with those paid for similar work in the contractor's organization. In those instances in which the required skills are not found in the contractor organization, rates shall be consistent with those paid for similar work in the labor market in which the contractor competes for the kind of services involved.
In addition to including the appropriate information in solicitations, the contracting officer also ensures that the award document incorporates the cost sharing requirement and that cost sharing is obtained.
Waiver of Cost Sharing Requirement
The Secretary has delegated the authority to make the determinations waiving the section 3002 non-Federal cost sharing requirement to the Director, Office of Procurement and Assistance Management.
The Director, Office of Procurement and Assistance Management, by separate document, redelegated authority to make EPAct cost sharing determinations to the Heads of Contracting Activities (HCAs) and, with respect to the financial assistance under the Office of Energy Research Financial Assistance Program Rule, 10 CFR Part 605, to the Director, Office of Energy ResearchScience.
Any determination waiving or reducing a cost sharing requirement must be based on the section 3002 criteria. For research and development programs, DOE must determine that the research and development is of a basic or fundamental nature.
For demonstration and commercial application programs, the determination must show that the reduction is necessary and appropriate, considering the technological risks involved in the project and the project is necessary to meet the objectives of EPAct. This determination should be based on demonstrated results of activities such as the following:
(1) Solicitations. The contracting activity has attempted to obtain cost sharing, but industry and others did not respond to the solicitation.
(2) Other studies. Market surveys or other studies have been conducted which provide significant data that commercial organizations are not willing to participate in programs, projects or other activities because of the cost sharing requirements.
Attachment
The attached listing identifies EPAct covered programs. ATTACHMENT 1
COVERED PROGRAMS- § 3002 EPACT SECTIONS
Fossil Energy R & D
Coal All Programs Including § 1301-1312 Coal-fired Diesel Engines § 1302 Clean Coal, Waste-To-Energy § 1303 Nonfuel Use of Coal § 1304 Coal Refinery Program § 1305 Coalbed Methane Recovery § 1306 Metallurgical Coal Development § 1307 Utilization of Coal Wastes § 1308 Underground Coal Gasification § 1309 Low-rank Coal Research and Development § 1310 Magnetohydrodynamics § 1311 Oil Substitution Through Coal Liquefaction § 1312
Clean Coal Technology § 1321 Fossil Energy R & D
Petroleum
Enhanced Oil Recovery All Programs Including: § 2011 Heavy Oil § 2011 Light Oil § 2011 Tar Sands § 2011 Advanced Extraction & Process Tech All Programs Including: § 2011 Geological Science/Extract Research § 2011 SPT Technology/Environmental Research § 2011 University Geoscience Research § 2011 Oil Shale All Programs: § 2012
Gas
Natural Gas Research All Programs Including: § 2013-2015 Resource & Extraction § 2013, 2014 Delivery & Storage § 2013, 2014 Utilization § 2013, 2014 Environmental Research & Regulatory Analysis § 2013, 2014 Midcontinent Energy Research Center* § 2013, 2015 Fuel Cells All Programs Including: § 2115 Advanced Research § 2115 Phosphoric Acid Systems § 2115 Molten Carbonate Systems § 2115 Advanced Concepts § 2115
Energy Conservation
Transportation All Programs Including: § 2021-2025, 2027, 2028, 2112 Alternative Fuels Utilization § 2021, 2023 Materials Development § 2021 Heat Engine Development § 2021, 2112 Electric & Hybrid Propulsion Development § 2021, 2025 Implementation & Deployment § 2021 Management § 2021 Management-Capital Equipment § 2021 Advanced Automotive Fuel Economy § 2021, 2022 Biofuels User Facility* § 2021, 2024 Advanced Diesel Emissions Program* § 2021, 2027 Telecommuting Study* § 2021, 2028
Utility All Programs Including: § 2101 Integrated Resource Planning § 2101 Program Direction-IRP § 2101 Energy Management Control § 2101
Industry All Programs Including: § 2101-2108 Industrial Wastes § 2101 Municipal Solid Wastes § 2101 Cogeneration § 2101 Electric Drives § 2101, 2105 Materials Processing § 2101, 2107 Separations § 2101 Sensors & Controls § 2101 Bioprocessing § 2101 Enabling Materials § 2101 Improved Combustion Efficiency § 2101, 2107 Process Heating & Cooling § 2101, 2102 Implementation & Deployment § 2101 Management § 2101 Management-Capital Equipment § 2101 National Advanced Manufacturing Tech Initiative* § 2101, 2202 Pulp & Paper* § 2101, 2103 Steel, Aluminum, and Metal Research* § 2101, 2106 Energy Efficient Environmental Program* § 2101, 2108
Buildings All Programs Including: § 2101-2108 Solar Technologies § 2101 Materials & Structures § 2101 Lighting & Appliances § 2101 Heating & Cooling Equipment § 2101, 2102 Indoor Air Quality § 2101 Building Systems Research § 2101 Federal Energy Management Program § 2101 Implementation & Deployment § 2101 Management § 2101 Management-Capital Equipment § 2101 Advanced Buildings for 2005* § 2101, 2104
Energy Supply R & D
Energy Research
Fusion Energy All Programs Including: § 2114 Confinement Systems § 2114 Development & Technology . § 2114 Applied Plasma Physics § 2114 Planning & Projects § 2114 Inertial Fusion Energy § 2114 Program Direction-Op Exp § 2114 Capital Equipment & Construction § 2114 Basic Energy Sciences All Programs Including: § 2203 Materials Sciences § 2203 Chemical Sciences § 2203 Energy Biosciences § 2203 Engineering & Geosciences § 2203 Applied Math Sciences § 2203, 2204 Advanced Energy Projects § 2203 Advanced Neutron Source § 2203 Program Direction § 2203 Capital Equipment § 2203 Advisory & Oversight/Program Direction § 2203 Energy Research Analysis § 2203 University & Science Education Programs § 2203 Experimental Program to Stimulate Competitive Research* § 2203 Laboratory Technology Transfer § 2203 Multi-Program Laboratory Support § 2203
Nuclear Energy
Light Water Reactor § 2123, 2126 Advanced Reactor R&D § 2121, 2122 2124, 2126 Facilities § 2126 Solar & Renewables
Solar & Other Energy All Programs Including: § 2021, 2026, § 2111, 2117 Photovoltaics § 2111 Biofuels § 2021 Solar Technology Transfer § 2111 NREL § 2111 Program Direction- Other Solar Energy § 2111 Solar Building Technology Research § 2111 Solar Thermal Energy Systems § 2111 Wind Energy Systems § 2111 Ocean Energy System § 2111 International Solar Energy Program § 2111 Resource Assessment § 2111 Program Support § 2111 Geothermal § 2111 Hydrogen Research § 2026 Electric Energy Systems including: Superconductivity § 2117, 2111 Energy Storage Systems § 2111
Environmental Restoration & Waste Management
Facility Transition-Fast Flux Test Facility § 2116
Civilian Waste R & D § 2113
Electric & Magnetic Fields Research and Public Dissemination Program* § 2118 Spark M. Matsunga Renewable Energy & Ocean Technology Center* § 2111, 2119
*Direct citation from Title XX-XXIII.
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