Defense Federal Acquisition Regulation Supplement: Improved Energy Security for Main Operating Bases in Europe (DFARS Case 2020-D030), 48336-48339 [2021-18340]
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48336
Federal Register / Vol. 86, No. 165 / Monday, August 30, 2021 / Rules and Regulations
https://www.epa.gov/sites/production/
files/2015-07/documents/trac2b054_
0.pdf.
21. EPA’s Exposure Factors Handbook.
Available at: https://www.epa.gov/
expobox/about-exposure-factorshandbook.
22. U.S. EPA (2014). Guidance for Applying
Quantitative Data to Develop DataDerived Extrapolation Factors for
Interspecies and Intraspecies
Extrapolation. Available at: https://
www.epa.gov/sites/default/files/2015-01/
documents/ddef-final.pdf.
23. U.S. EPA (2014). Chlorpyrifos Acute and
Steady Dietary (Food Only) Exposure
Analysis to Support Registration Review.
Available at: https://
www.regulations.gov/document/EPAHQ-OPP-2008-0850-0197.
24. U.S. EPA (2020). Framework for
Conducting Pesticide Drinking Water
Assessments for Surface Water.
Environmental Fate and Effects Division.
Office of Pesticide Programs. Office of
Chemical Safety and Pollution
Prevention. U.S. Environmental
Protection Agency. Available at: https://
www.epa.gov/sites/default/files/2020-09/
documents/framework-conductingpesticide-dw-sw.pdf.
25. FIFRA Scientific Advisory Panel (2019)
‘‘Approaches for Quantitative Use of
Surface Water Monitoring Data in
Pesticide Drinking Water Assessments.’’
Available at: https://
www.regulations.gov/document/EPAHQ-OPP-2019-0417-0019.
26. U.S. EPA (2001). General Principles for
Performing Aggregate Exposure and Risk
Assessments. Available at: https://
www.epa.gov/sites/default/files/2015-07/
documents/aggregate.pdf.
27. U.S. EPA (2020). Appendix B. Case Study
for Integrating a Distributional Approach
to Using Percent Crop Area (PCA) and
Percent Crop Treated (PCT) into
Drinking Water Assessment. Available
at: https://www.regulations.gov/
document/EPA-HQ-OPP-2020-02790002.
28. U.S. EPA (2016). Chlorpyrifos Refined
Drinking Water Assessment for
Registration Review. Available at:
https://www.regulations.gov/document/
EPA-HQ-OPP-2015-0653-0437.
29. U.S. EPA (2014). Chlorpyrifos Updated
Drinking Water Assessment for
Registration Review. Available at:
https://www.regulations.gov/document/
EPA-HQ-OPP-2008-0850-0198.
30. U.S. EPA (2015). Proposed Rule:
Tolerance Revocations: Chlorpyrifos.
Available at: https://
www.regulations.gov/document/EPAHQ-OPP-2015-0653-0001.
31. U.S. EPA (2011). Finalization of Guidance
on Incorporation of Water Treatment
Effects on Pesticide Removal and
Transformations in Drinking Water
Exposure Assessments. Available at:
https://www.epa.gov/pesticide-scienceand-assessing-pesticide-risks/
finalization-guidance-incorporationwater-treatment.
32. U.S. EPA (2020). Chlorpyrifos Proposed
Interim Registration Review Decision.
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16:13 Aug 27, 2021
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Available at: https://
www.regulations.gov/document/EPAHQ-OPP-2008-0850-0971.
33. For more information on World Trade
Organization’s Agreement on the
Application of Sanitary and
Phytosanitary Measures (SPS
Agreement), please see: https://
www.wto.org/english/tratop_e/sps_e/
spsagr_e.htm.
34. For more information on World Trade
Organization (2001) ImplementationRelated Issues and Concerns, please see:
https://docs.wto.org/dol2fe/Pages/SS/
directdoc.aspx?filename=Q:/WT/Min01/
17.pdf&Open=True.
List of Subjects in 40 CFR Part 180
Environmental protection,
Administrative practice and procedure,
Agricultural commodities, Pesticides
and pests, Reporting and recordkeeping
requirements.
Dated: August 18, 2021.
Edward Messina,
Director, Office of Pesticide Programs.
Therefore, for the reasons set forth in
the preamble, 40 CFR part 180 is
amended as follows:
PART 180—[AMENDED]
1. The authority citation for part 180
continues to read as follows:
■
Authority: 21 U.S.C. 321(q), 346a and 371.
2. In § 180.342, add introductory text
to read as follows:
■
§ 180.342 Chlorpyrifos; tolerances for
residues.
This section and all tolerances
contained herein expire and are revoked
on February 28, 2022.
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[FR Doc. 2021–18091 Filed 8–27–21; 8:45 am]
BILLING CODE 6560–50–P
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Parts 212, 225 and 252
[Docket DARS–2020–0039]
RIN 0750–AL15
Defense Federal Acquisition
Regulation Supplement: Improved
Energy Security for Main Operating
Bases in Europe (DFARS Case 2020–
D030)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Final rule.
AGENCY:
DoD is issuing a final rule
amending the Defense Federal
SUMMARY:
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Acquisition Regulation Supplement
(DFARS) to implement a section of the
National Defense Authorization Act for
Fiscal Year 2020. This section prohibits
contracts for the acquisition of
furnished energy for a covered military
installation in Europe that is sourced
from inside the Russian Federation.
DATES: Effective August 30, 2021.
FOR FURTHER INFORMATION CONTACT: Ms.
Kimberly Bass, telephone 571–372–
6174.
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the
Federal Register at 86 FR 3935 on
January 15, 2021, to amend the DFARS
to implement section 2821 of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020 (Pub.
L. 116–92). Section 2821 prohibits use
of energy sourced from inside the
Russian Federation in an effort to
promote energy security in Europe. The
prohibition applies to all forms of
energy ‘‘furnished to a covered military
installation’’ as that term is defined in
the statute. No public comments were
received in response to the proposed
rule.
II. Discussion and Analysis
A. Summary of Significant Changes
No changes are made to the final rule
as a result of public comments.
B. Other Changes
One change is made to the rule as
proposed to clarify the same language
that appears in section 225.7019–2,
paragraph (b); the provision 252.225–
7053, paragraph (b)(2); and clause
252.225–7054, paragraph (b)(2). In all
three locations, the statement ‘‘Does not
apply to a third party that uses it to
create some other form of energy (e.g.,
heating, cooling, or electricity)’’ is
changed to read ‘‘Does not apply to
energy converted by a third party into
another form of energy and not directly
delivered to a covered military
installation.’’ No other changes are
made to the rule.
III. Applicability to Contracts At or
Below the Simplified Acquisition
Threshold and for Commercial Items,
Including Commercially Available Offthe-Shelf Items
This DFARS rule implements section
2821 of the NDAA for FY 2020 (Pub. L.
116–92). Section 2821 prohibits use of
energy sourced from inside the Russian
Federation unless a waiver is approved
by the head of the contracting activity.
To implement section 2821, this rule
creates a new solicitation provision and
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contract clause: (1) DFARS 252.225–
7053, Representation Regarding
Prohibition on Use of Certain Energy
Sourced from Inside the Russian
Federation, and (2) DFARS 252.225–
7054, Prohibition on Use of Certain
Energy Sourced from Inside the Russian
Federation.
Section 2821 is silent on applicability
to contracts and subcontracts in
amounts at or below the simplified
acquisition threshold (SAT) or for the
acquisition of commercial items. Also,
the statute does not provide for civil or
criminal penalties. Therefore, it does
not apply to contracts or subcontracts in
amounts not greater than the SAT or to
the acquisition of commercial items,
including COTS items, unless a written
determination is made as provided for
in 41 U.S.C. 1905 and 10 U.S.C. 2375,
respectively. The Principal Director,
Defense Pricing and Contracting, is the
appropriate authority to make a
determination for regulations to be
published in the DFARS, which is part
of the FAR system of regulations. In
consonance with the written
determination made by the Principal
Director, Defense Pricing and
Contracting, on May 29, 2020, DoD will
apply section 2821 to solicitations and
contracts at or below the SAT and to the
acquisition of commercial items,
including COTS items, as defined at
FAR 2.101. Not applying this
prohibition guidance to contracts at or
below the SAT and for the acquisition
of commercial items, including COTS
items, would exclude contracts
intended to be covered by this rule and
undermine the overarching purpose of
the rule to prohibit use of energy
sourced from inside the Russian
Federation. Consequently, DoD will
apply the rule to contracts at or below
the SAT and for the acquisition of
commercial items, including COTS
items, to promote energy security in
Europe and reduce the risk of supply
shortages and reliance on energy
sourced inside the Russian Federation.
IV. Expected Impact of the Rule
This rule amends the DFARS to
implement section 2821 of the NDAA
for FY 2020 (Pub. L. 116–92). Section
2821 prohibits the use of energy sourced
from inside the Russian Federation in
an effort to promote energy security in
Europe. The prohibition applies to all
forms of energy that is ‘‘furnished to a
covered military installation’’, as that
term is defined in the statute and only
to main operating bases as defined and
identified by DoD. This means the
energy itself must be furnished to the
military installation, not to a third party
that uses it to create some other form of
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energy (e.g., heating, cooling, or
electric). The prohibition applies only to
Europe, not to Asia (for example, those
parts of Turkey located in Asia).
DoD will promote the energy security
of its European installations by
encouraging energy security and energy
resilience and will not purchase energy
sourced from inside the Russian
Federation unless a waiver of the
prohibition in section 2821 is approved
by the head of the contracting activity.
The rule requires the head of the
contracting activity to submit to the
congressional defense committees a
notice of the waiver.
The following factors will be taken
into consideration for granting a waiver:
(1) The energy supply system is
physically incapable of segregating
Russian Federation energy from nonRussian Federation energy.
(2) The installation can only obtain
the necessary energy from its current
supplier without the unaffordable
expense of constructing new supply
lines.
(3) The price of requiring the supplier
to segregate the energy is unaffordable
and would result in the installation
being unable to perform its mission
within its budget authority.
(4) Consideration, by the requiring
activity, of installation energy and
security resilience has been taken into
account (e.g., on-site sources of energy
and fuel resupply would allow the
installation to continue to perform its
mission even with disruption of Russian
Federation-sourced energy, the
installation has addressed energy
resilience and security risks and
vulnerabilities, etc.).
According to Federal Procurement
Data System (FPDS) data for fiscal years
2017 through 2019, DoD awards an
average of 108 contracts each year that
are assigned the product service code
(PSC) S111, with an average of 3 of
those awards being made to unique
entities that were other than small
businesses.
PSC
Description
S111
Utilities—Gas (with locations in Europe).
The awardees were listed as foreign
contractor consolidated reporting.
Foreign contractor consolidated
reporting is used to report procurement
actions awarded to contractors located
outside the United States providing
utilities goods or services when a
unique entity identifier is not available.
When a generic entity identifier is used
to report these actions, FPDS only
allows contracting officers to select
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48337
‘‘other than small business’’ as the
contracting officer’s determination of
business size. FPDS allows contracting
officers to aggregate awards and report
one record that includes multiple
awards, which masks the identity of the
entity. Consequently, reporting awards
in this manner is likely to result in an
undercount of the number of unique
entities, as there is no data available to
determine the number of entities or
whether the entities are small or other
than small.
Based on this analysis, DoD estimates
it is highly unlikely that an American
small entity would be providing these
utility services in Europe. It is expected
that this rule will not impact small
businesses, but it may impact large
businesses or their subcontractors who
compete on solicitations for Federal
overseas energy contracts for utilities
and gas in Europe.
Utilizing energy sourced from inside
the Russian Federation could increase
the risk of limited access to the required
energy supply, resulting in negative
impacts to the warfighter. Section 2911
of title 10 United States Code ensures
the readiness of the armed forces for
their military missions by pursuing
energy security and resilience. Further,
DoD Instruction 4170.11, Installation
Energy Management, encourages DoD
components to pursue energy resilience.
In today’s environment, maintaining
secure access to energy resources is
critical to DoD’s execution of its
mission, and ensuring energy resilience
at DoD installations is a top priority.
This prohibition will ensure
improved energy security for main
operating bases in Europe. This rule
requires an offeror to represent, by
submission of their offer, that the offeror
will not use any energy sourced from
inside the Russian Federation as a
means of generating the furnished
energy for the covered military
installation in Europe. In addition, the
rule provides a contract clause that
ensures the prohibition is incorporated
as a term and condition of the resulting
contract.
V. Executive Orders 12866 and 13563
Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs
and benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). E.O. 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
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Federal Register / Vol. 86, No. 165 / Monday, August 30, 2021 / Rules and Regulations
harmonizing rules, and of promoting
flexibility. This is a significant
regulatory action and, therefore, was
subject to review under section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993.
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VI. Congressional Review Act
As required by the Congressional
Review Act (5 U.S.C. 801–808) before an
interim or final rule takes effect, DoD
will submit a copy of the interim or
final rule with the form, Submission of
Federal Rules Under the Congressional
Review Act, to the U.S. Senate, the U.S.
House of Representatives, and the
Comptroller General of the United
States. A major rule under the
Congressional Review Act cannot take
effect until 60 days after it is published
in the Federal Register. The Office of
Information and Regulatory Affairs in
the Office of Management and Budget
has determined that this rule is not a
major rule as defined by 5 U.S.C. 804.
VII. Regulatory Flexibility Act
A final regulatory flexibility analysis
(FRFA) has been prepared consistent
with the Regulatory Flexibility Act, 5
U.S.C. 601, et seq. The FRFA is
summarized as follows:
The final rule is necessary to revise
the Defense Federal Acquisition
Regulation Supplement (DFARS) to
implement a statute that prohibits
contracts for the use of energy sourced
inside the Russian Federation for
military installations in Europe.
The objective for and the legal basis
for the rule is section 2821 of the
National Defense Authorization Act
(NDAA) for Fiscal Year (FY) 2020,
which prohibits use of energy sourced
from inside the Russian Federation in
an effort to promote energy security in
Europe. The prohibition applies to all
forms of energy ‘‘furnished to a covered
military installation,’’ as that term is
defined in the statute, and only to main
operating bases as defined and
identified by DoD.
No public comments were received in
response to the initial regulatory
flexibility analysis.
According to data obtained from the
Federal Procurement Data System
(FPDS) for fiscal years 2017 through
2019 for awards coded for product
service code S111 (Utilities-Gas) with
locations in Europe, 108 awards per
year were made on average over the
three fiscal years, with an average of 3
awards to unique entities that were
other than small businesses. The
awardees were listed as foreign
contractor consolidated reporting,
which is used to report procurement
actions awarded to contractors located
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outside the United States providing
utilities goods or services when a
unique entity identifier is not available.
When a generic entity identifier is used
to report these actions, FPDS only
allows contracting officers to select
‘‘other than small business’’ as the
contracting officer’s determination of
business size. FPDS allows contracting
officers to aggregate awards and report
one record that includes multiple
awards, which masks the identity of the
entity. Consequently, reporting awards
in this manner is likely to result in an
undercount of the number of unique
entities, as there is no data available to
determine the number of entities or
whether the entities are small or other
than small. Based on this analysis, DoD
estimates it is unlikely that an American
small entity would be providing these
utility services in Europe. Therefore,
DoD does not expect this rule to impact
small entities.
This rule does not include any new
reporting, recordkeeping, or other
compliance requirements for small
entities.
DoD has not identified any alternative
approaches to the rule that would meet
the requirements of the statute.
VIII. Paperwork Reduction Act
This rule does not contain any
information collection requirements that
require the approval of the Office of
Management and Budget under the
Paperwork Reduction Act (44 U.S.C.
chapter 35).
List of Subjects in 48 CFR Parts 212,
225 and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition
Regulations System.
Therefore, 48 CFR parts 212, 225, and
252 are amended as follows:
■ 1. The authority citation for 48 CFR
parts 212, 225, and 252 continues to
read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR
chapter 1.
PART 212—ACQUISITION OF
COMMERCIAL ITEMS
2. Amend section 212.301 by adding
paragraphs (f)(ix)(GG) and (HH) to read
as follows:
■
212.301 Solicitation provisions and
contract clauses for the acquisition of
commercial items.
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(f) * * *
(ix) * * *
(GG) Use the provision at 252.225–
7053, Representation Regarding
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Prohibition on Use of Certain Energy
Sourced from Inside the Russian
Federation, as prescribed in 225.7019–
4(a), to comply with section 2821 of the
National Defense Authorization Act for
Fiscal Year 2020 (Pub. L. 116–92).
(HH) Use the clause at 252.225–7054,
Prohibition on Use of Certain Energy
Sourced from Inside the Russian
Federation, as prescribed in 225.7019–
4(b), to comply with section 2821 of the
National Defense Authorization Act for
Fiscal Year 2020 (Pub. L. 116–92).
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PART 225—FOREIGN ACQUISITION
3. Add sections 225.7019, 225.7019–1,
225.7019–2, 225.7019–3, and 225.7019–
4 to subpart 225.70 to read as follows:
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■
Sec.
225.7019 Prohibition on use of certain
energy sourced from inside the Russian
Federation.
225.7019–1 Definitions.
225.7019–2 Prohibition.
225.7019–3 Waiver.
225.7019–4 Solicitation provision and
contract clause.
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225.7019 Prohibition on use of certain
energy sourced from inside the Russian
Federation.
225.7019–1
Definitions.
As used in this section—
Covered military installation means a
military installation in Europe
identified by DoD as a main operating
base.
Furnished energy means energy
furnished to a covered military
installation in any form and for any
purpose, including heating, cooling, and
electricity.
Main operating base means a facility
outside the United States and its
territories with permanently stationed
operating forces and robust
infrastructure.
225.7019–2
Prohibition.
In accordance with section 2821 of
the National Defense Authorization Act
for Fiscal Year 2020 (Pub. L. 116–92),
contracts for the acquisition of
furnished energy for a covered military
installation shall not use any energy
sourced from inside the Russian
Federation as a means of generating the
furnished energy for the covered
military installation. The prohibition—
(a) Applies to all forms of energy that
are furnished to a covered military
installation; and
(b) Does not apply to energy
converted by a third party into another
form of energy and not directly
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Federal Register / Vol. 86, No. 165 / Monday, August 30, 2021 / Rules and Regulations
delivered to a covered military
installation.
225.7019–3
Waiver.
(a) Request and approval of waiver.
The requiring activity may submit to the
contracting activity a request for waiver
of the prohibition in 225.7019–2 for a
specific contract for the acquisition of
furnished energy for a covered military
installation. The head of the contracting
activity, without power of redelegation,
may approve the waiver, upon
certification to the congressional
defense committees that—
(1) The waiver of section 2821 is
necessary to ensure an adequate supply
of furnished energy for the covered
military installation; and
(2) National security requirements
have been balanced against the potential
risk associated with reliance upon the
Russian Federation for furnished
energy.
(b) Submission of waiver notice. (1)
Not later than 14 days before the
execution of any energy contract for
which a waiver is granted under
paragraph (a) of this section, the head of
the contracting activity shall submit to
the congressional defense committees a
notice of the waiver. See PGI 225.7019–
3 for waiver procedures.
(2) The waiver notice shall include
the following:
(i) The rationale for the waiver,
including the basis for the certifications
required by paragraph (a) of this section.
(ii) An assessment of how the waiver
may impact DoD’s European energy
resilience strategy.
(iii) An explanation of the measures
DoD is taking to mitigate the risk of
using Russian Federation furnished
energy.
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225.7019–4 Solicitation provision and
contract clause.
Unless a waiver has been granted in
accordance with 225.7019–3—
(a) Use the provision at 252.225–7053,
Representation Regarding Prohibition
on Use of Certain Energy Sourced from
Inside the Russian Federation, in
solicitations, including solicitations
using FAR part 12 procedures for the
acquisition of commercial items and
solicitations at or below the simplified
acquisition threshold, that are for the
acquisition of furnished energy for a
covered military installation; and
(b) Use the clause at 252.225–7054,
Prohibition on Use of Certain Energy
Sourced from Inside the Russian
Federation, in solicitations and
contracts, including solicitations and
contracts using FAR part 12 procedures
for the acquisition of commercial items
and solicitations and contracts at or
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below the simplified acquisition
threshold, that are for the acquisition of
furnished energy for a covered military
installation.
PART 252—SOLICITATION
PROVISIONS AND CONTRACT
CLAUSES
4. Add section 252.225–7053 to read
as follows:
■
252.225–7053 Representation Regarding
Prohibition on Use of Certain Energy
Sourced from Inside the Russian
Federation.
As prescribed in 225.7019–4(a), use
the following provision:
REPRESENTATION REGARDING
PROHIBITION ON USE OF CERTAIN
ENERGY SOURCED FROM INSIDE THE
RUSSIAN FEDERATION (AUG 2021)
(a) Definitions. As used in this provision—
Covered military installation means a
military installation in Europe identified by
DoD as a main operating base.
Furnished energy means energy furnished
to a covered military installation in any form
and for any purpose, including heating,
cooling, and electricity.
Main operating base means a facility
outside the United States and its territories
with permanently stationed operating forces
and robust infrastructure.
(b) Prohibition. In accordance with section
2821 of the National Defense Authorization
Act for Fiscal Year 2020 (Pub. L. 116–92),
contracts for the acquisition of furnished
energy for a covered military installation
shall not use any energy sourced from inside
the Russian Federation as a means of
generating the furnished energy for the
covered military installation, unless a waiver
is approved. The prohibition—
(1) Applies to all forms of energy that are
furnished to a covered military installation;
and
(2) Does not apply to energy converted by
a third party into another form of energy and
not directly delivered to a covered military
installation.
(c) Representation. By submission of its
offer, the Offeror represents that the Offeror
will not use or provide any energy sourced
from inside the Russian Federation as a
means of generating the furnished energy for
the covered military installation in the
performance of any contract, subcontract, or
other contractual instrument resulting from
this solicitation.
(End of provision)
5. Add section 252.225–7054 to read
as follows:
■
252.225–7054 Prohibition on Use of
Certain Energy Sourced from Inside the
Russian Federation.
As prescribed in 225.7019–4(b), use
the following clause: PROHIBITION ON
USE OF CERTAIN ENERGY SOURCED
FROM INSIDE THE RUSSIAN
FEDERATION (AUG 2021)
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48339
(a) Definitions. As used in this clause—
Covered military installation means a
military installation in Europe identified by
DoD as a main operating base.
Furnished energy means energy furnished
to a covered military installation in any form
and for any purpose, including heating,
cooling, and electricity.
Main operating base means a facility
outside the United States and its territories
with permanently stationed operating forces
and robust infrastructure.
(b) Prohibition. In accordance with section
2821 of the National Defense Authorization
Act for Fiscal Year 2020 (Pub. L. 116–92), the
Contractor shall not use in the performance
of this contract any energy sourced from
inside the Russian Federation as a means of
generating the furnished energy for the
covered military installation unless a waiver
is approved. The prohibition—
(1) Applies to all forms of energy that are
furnished to a covered military installation;
and
(2) Does not apply to energy converted by
a third party into another form of energy and
not directly delivered to a covered military
installation.
(c) Subcontracts. The Contractor shall
insert the substance of this clause, including
this paragraph (c), in subcontracts and other
commercial instruments that are for
furnished energy at a covered military
installation, including subcontracts and
commercial instruments for commercial
items.
(End of clause)
[FR Doc. 2021–18340 Filed 8–27–21; 8:45 am]
BILLING CODE 5001–06–P
DEPARTMENT OF DEFENSE
Defense Acquisition Regulations
System
48 CFR Part 225
[Docket DARS–2021–0016]
RIN 0750–AL37
Defense Federal Acquisition
Regulation Supplement; Use of FirmFixed-Price Contracts for Foreign
Military Sales (DFARS Case 2021–
D019)
Defense Acquisition
Regulations System, Department of
Defense (DoD).
ACTION: Final rule.
AGENCY:
DoD is issuing a final rule
amending the Defense Federal
Acquisition Regulation Supplement
(DFARS) to implement a section of the
National Defense Authorization Act for
Fiscal Year 2021 that rescinds the
requirement for the use of firm-fixedprice contract types for foreign military
sales unless an exception or waiver
applies.
SUMMARY:
E:\FR\FM\30AUR1.SGM
30AUR1
]]>Agencies
[Federal Register Volume 86, Number 165 (Monday, August 30, 2021)]
[Rules and Regulations]
[Pages 48336-48339]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18340]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 212, 225 and 252
[Docket DARS-2020-0039]
RIN 0750-AL15
Defense Federal Acquisition Regulation Supplement: Improved
Energy Security for Main Operating Bases in Europe (DFARS Case 2020-
D030)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: DoD is issuing a final rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to implement a section of the
National Defense Authorization Act for Fiscal Year 2020. This section
prohibits contracts for the acquisition of furnished energy for a
covered military installation in Europe that is sourced from inside the
Russian Federation.
DATES: Effective August 30, 2021.
FOR FURTHER INFORMATION CONTACT: Ms. Kimberly Bass, telephone 571-372-
6174.
SUPPLEMENTARY INFORMATION:
I. Background
DoD published a proposed rule in the Federal Register at 86 FR 3935
on January 15, 2021, to amend the DFARS to implement section 2821 of
the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2020
(Pub. L. 116-92). Section 2821 prohibits use of energy sourced from
inside the Russian Federation in an effort to promote energy security
in Europe. The prohibition applies to all forms of energy ``furnished
to a covered military installation'' as that term is defined in the
statute. No public comments were received in response to the proposed
rule.
II. Discussion and Analysis
A. Summary of Significant Changes
No changes are made to the final rule as a result of public
comments.
B. Other Changes
One change is made to the rule as proposed to clarify the same
language that appears in section 225.7019-2, paragraph (b); the
provision 252.225-7053, paragraph (b)(2); and clause 252.225-7054,
paragraph (b)(2). In all three locations, the statement ``Does not
apply to a third party that uses it to create some other form of energy
(e.g., heating, cooling, or electricity)'' is changed to read ``Does
not apply to energy converted by a third party into another form of
energy and not directly delivered to a covered military installation.''
No other changes are made to the rule.
III. Applicability to Contracts At or Below the Simplified Acquisition
Threshold and for Commercial Items, Including Commercially Available
Off-the-Shelf Items
This DFARS rule implements section 2821 of the NDAA for FY 2020
(Pub. L. 116-92). Section 2821 prohibits use of energy sourced from
inside the Russian Federation unless a waiver is approved by the head
of the contracting activity. To implement section 2821, this rule
creates a new solicitation provision and
[[Page 48337]]
contract clause: (1) DFARS 252.225-7053, Representation Regarding
Prohibition on Use of Certain Energy Sourced from Inside the Russian
Federation, and (2) DFARS 252.225-7054, Prohibition on Use of Certain
Energy Sourced from Inside the Russian Federation.
Section 2821 is silent on applicability to contracts and
subcontracts in amounts at or below the simplified acquisition
threshold (SAT) or for the acquisition of commercial items. Also, the
statute does not provide for civil or criminal penalties. Therefore, it
does not apply to contracts or subcontracts in amounts not greater than
the SAT or to the acquisition of commercial items, including COTS
items, unless a written determination is made as provided for in 41
U.S.C. 1905 and 10 U.S.C. 2375, respectively. The Principal Director,
Defense Pricing and Contracting, is the appropriate authority to make a
determination for regulations to be published in the DFARS, which is
part of the FAR system of regulations. In consonance with the written
determination made by the Principal Director, Defense Pricing and
Contracting, on May 29, 2020, DoD will apply section 2821 to
solicitations and contracts at or below the SAT and to the acquisition
of commercial items, including COTS items, as defined at FAR 2.101. Not
applying this prohibition guidance to contracts at or below the SAT and
for the acquisition of commercial items, including COTS items, would
exclude contracts intended to be covered by this rule and undermine the
overarching purpose of the rule to prohibit use of energy sourced from
inside the Russian Federation. Consequently, DoD will apply the rule to
contracts at or below the SAT and for the acquisition of commercial
items, including COTS items, to promote energy security in Europe and
reduce the risk of supply shortages and reliance on energy sourced
inside the Russian Federation.
IV. Expected Impact of the Rule
This rule amends the DFARS to implement section 2821 of the NDAA
for FY 2020 (Pub. L. 116-92). Section 2821 prohibits the use of energy
sourced from inside the Russian Federation in an effort to promote
energy security in Europe. The prohibition applies to all forms of
energy that is ``furnished to a covered military installation'', as
that term is defined in the statute and only to main operating bases as
defined and identified by DoD. This means the energy itself must be
furnished to the military installation, not to a third party that uses
it to create some other form of energy (e.g., heating, cooling, or
electric). The prohibition applies only to Europe, not to Asia (for
example, those parts of Turkey located in Asia).
DoD will promote the energy security of its European installations
by encouraging energy security and energy resilience and will not
purchase energy sourced from inside the Russian Federation unless a
waiver of the prohibition in section 2821 is approved by the head of
the contracting activity. The rule requires the head of the contracting
activity to submit to the congressional defense committees a notice of
the waiver.
The following factors will be taken into consideration for granting
a waiver:
(1) The energy supply system is physically incapable of segregating
Russian Federation energy from non-Russian Federation energy.
(2) The installation can only obtain the necessary energy from its
current supplier without the unaffordable expense of constructing new
supply lines.
(3) The price of requiring the supplier to segregate the energy is
unaffordable and would result in the installation being unable to
perform its mission within its budget authority.
(4) Consideration, by the requiring activity, of installation
energy and security resilience has been taken into account (e.g., on-
site sources of energy and fuel resupply would allow the installation
to continue to perform its mission even with disruption of Russian
Federation-sourced energy, the installation has addressed energy
resilience and security risks and vulnerabilities, etc.).
According to Federal Procurement Data System (FPDS) data for fiscal
years 2017 through 2019, DoD awards an average of 108 contracts each
year that are assigned the product service code (PSC) S111, with an
average of 3 of those awards being made to unique entities that were
other than small businesses.
------------------------------------------------------------------------
PSC Description
------------------------------------------------------------------------
S111........................... Utilities--Gas (with locations in
Europe).
------------------------------------------------------------------------
The awardees were listed as foreign contractor consolidated
reporting. Foreign contractor consolidated reporting is used to report
procurement actions awarded to contractors located outside the United
States providing utilities goods or services when a unique entity
identifier is not available. When a generic entity identifier is used
to report these actions, FPDS only allows contracting officers to
select ``other than small business'' as the contracting officer's
determination of business size. FPDS allows contracting officers to
aggregate awards and report one record that includes multiple awards,
which masks the identity of the entity. Consequently, reporting awards
in this manner is likely to result in an undercount of the number of
unique entities, as there is no data available to determine the number
of entities or whether the entities are small or other than small.
Based on this analysis, DoD estimates it is highly unlikely that an
American small entity would be providing these utility services in
Europe. It is expected that this rule will not impact small businesses,
but it may impact large businesses or their subcontractors who compete
on solicitations for Federal overseas energy contracts for utilities
and gas in Europe.
Utilizing energy sourced from inside the Russian Federation could
increase the risk of limited access to the required energy supply,
resulting in negative impacts to the warfighter. Section 2911 of title
10 United States Code ensures the readiness of the armed forces for
their military missions by pursuing energy security and resilience.
Further, DoD Instruction 4170.11, Installation Energy Management,
encourages DoD components to pursue energy resilience. In today's
environment, maintaining secure access to energy resources is critical
to DoD's execution of its mission, and ensuring energy resilience at
DoD installations is a top priority.
This prohibition will ensure improved energy security for main
operating bases in Europe. This rule requires an offeror to represent,
by submission of their offer, that the offeror will not use any energy
sourced from inside the Russian Federation as a means of generating the
furnished energy for the covered military installation in Europe. In
addition, the rule provides a contract clause that ensures the
prohibition is incorporated as a term and condition of the resulting
contract.
V. Executive Orders 12866 and 13563
Executive Orders 12866 and 13563 Executive Orders (E.O.s) 12866 and
13563 direct agencies to assess all costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize net benefits (including potential
economic, environmental, public health and safety effects, distributive
impacts, and equity). E.O. 13563 emphasizes the importance of
quantifying both costs and benefits, of reducing costs, of
[[Page 48338]]
harmonizing rules, and of promoting flexibility. This is a significant
regulatory action and, therefore, was subject to review under section
6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30,
1993.
VI. Congressional Review Act
As required by the Congressional Review Act (5 U.S.C. 801-808)
before an interim or final rule takes effect, DoD will submit a copy of
the interim or final rule with the form, Submission of Federal Rules
Under the Congressional Review Act, to the U.S. Senate, the U.S. House
of Representatives, and the Comptroller General of the United States. A
major rule under the Congressional Review Act cannot take effect until
60 days after it is published in the Federal Register. The Office of
Information and Regulatory Affairs in the Office of Management and
Budget has determined that this rule is not a major rule as defined by
5 U.S.C. 804.
VII. Regulatory Flexibility Act
A final regulatory flexibility analysis (FRFA) has been prepared
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.
The FRFA is summarized as follows:
The final rule is necessary to revise the Defense Federal
Acquisition Regulation Supplement (DFARS) to implement a statute that
prohibits contracts for the use of energy sourced inside the Russian
Federation for military installations in Europe.
The objective for and the legal basis for the rule is section 2821
of the National Defense Authorization Act (NDAA) for Fiscal Year (FY)
2020, which prohibits use of energy sourced from inside the Russian
Federation in an effort to promote energy security in Europe. The
prohibition applies to all forms of energy ``furnished to a covered
military installation,'' as that term is defined in the statute, and
only to main operating bases as defined and identified by DoD.
No public comments were received in response to the initial
regulatory flexibility analysis.
According to data obtained from the Federal Procurement Data System
(FPDS) for fiscal years 2017 through 2019 for awards coded for product
service code S111 (Utilities-Gas) with locations in Europe, 108 awards
per year were made on average over the three fiscal years, with an
average of 3 awards to unique entities that were other than small
businesses. The awardees were listed as foreign contractor consolidated
reporting, which is used to report procurement actions awarded to
contractors located outside the United States providing utilities goods
or services when a unique entity identifier is not available. When a
generic entity identifier is used to report these actions, FPDS only
allows contracting officers to select ``other than small business'' as
the contracting officer's determination of business size. FPDS allows
contracting officers to aggregate awards and report one record that
includes multiple awards, which masks the identity of the entity.
Consequently, reporting awards in this manner is likely to result in an
undercount of the number of unique entities, as there is no data
available to determine the number of entities or whether the entities
are small or other than small. Based on this analysis, DoD estimates it
is unlikely that an American small entity would be providing these
utility services in Europe. Therefore, DoD does not expect this rule to
impact small entities.
This rule does not include any new reporting, recordkeeping, or
other compliance requirements for small entities.
DoD has not identified any alternative approaches to the rule that
would meet the requirements of the statute.
VIII. Paperwork Reduction Act
This rule does not contain any information collection requirements
that require the approval of the Office of Management and Budget under
the Paperwork Reduction Act (44 U.S.C. chapter 35).
List of Subjects in 48 CFR Parts 212, 225 and 252
Government procurement.
Jennifer D. Johnson,
Editor/Publisher, Defense Acquisition Regulations System.
Therefore, 48 CFR parts 212, 225, and 252 are amended as follows:
0
1. The authority citation for 48 CFR parts 212, 225, and 252 continues
to read as follows:
Authority: 41 U.S.C. 1303 and 48 CFR chapter 1.
PART 212--ACQUISITION OF COMMERCIAL ITEMS
0
2. Amend section 212.301 by adding paragraphs (f)(ix)(GG) and (HH) to
read as follows:
212.301 Solicitation provisions and contract clauses for the
acquisition of commercial items.
* * * * *
(f) * * *
(ix) * * *
(GG) Use the provision at 252.225-7053, Representation Regarding
Prohibition on Use of Certain Energy Sourced from Inside the Russian
Federation, as prescribed in 225.7019-4(a), to comply with section 2821
of the National Defense Authorization Act for Fiscal Year 2020 (Pub. L.
116-92).
(HH) Use the clause at 252.225-7054, Prohibition on Use of Certain
Energy Sourced from Inside the Russian Federation, as prescribed in
225.7019-4(b), to comply with section 2821 of the National Defense
Authorization Act for Fiscal Year 2020 (Pub. L. 116-92).
* * * * *
PART 225--FOREIGN ACQUISITION
0
3. Add sections 225.7019, 225.7019-1, 225.7019-2, 225.7019-3, and
225.7019-4 to subpart 225.70 to read as follows:
* * * * *
Sec.
225.7019 Prohibition on use of certain energy sourced from inside
the Russian Federation.
225.7019-1 Definitions.
225.7019-2 Prohibition.
225.7019-3 Waiver.
225.7019-4 Solicitation provision and contract clause.
* * * * *
225.7019 Prohibition on use of certain energy sourced from inside the
Russian Federation.
225.7019-1 Definitions.
As used in this section--
Covered military installation means a military installation in
Europe identified by DoD as a main operating base.
Furnished energy means energy furnished to a covered military
installation in any form and for any purpose, including heating,
cooling, and electricity.
Main operating base means a facility outside the United States and
its territories with permanently stationed operating forces and robust
infrastructure.
225.7019-2 Prohibition.
In accordance with section 2821 of the National Defense
Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), contracts for
the acquisition of furnished energy for a covered military installation
shall not use any energy sourced from inside the Russian Federation as
a means of generating the furnished energy for the covered military
installation. The prohibition--
(a) Applies to all forms of energy that are furnished to a covered
military installation; and
(b) Does not apply to energy converted by a third party into
another form of energy and not directly
[[Page 48339]]
delivered to a covered military installation.
225.7019-3 Waiver.
(a) Request and approval of waiver. The requiring activity may
submit to the contracting activity a request for waiver of the
prohibition in 225.7019-2 for a specific contract for the acquisition
of furnished energy for a covered military installation. The head of
the contracting activity, without power of redelegation, may approve
the waiver, upon certification to the congressional defense committees
that--
(1) The waiver of section 2821 is necessary to ensure an adequate
supply of furnished energy for the covered military installation; and
(2) National security requirements have been balanced against the
potential risk associated with reliance upon the Russian Federation for
furnished energy.
(b) Submission of waiver notice. (1) Not later than 14 days before
the execution of any energy contract for which a waiver is granted
under paragraph (a) of this section, the head of the contracting
activity shall submit to the congressional defense committees a notice
of the waiver. See PGI 225.7019-3 for waiver procedures.
(2) The waiver notice shall include the following:
(i) The rationale for the waiver, including the basis for the
certifications required by paragraph (a) of this section.
(ii) An assessment of how the waiver may impact DoD's European
energy resilience strategy.
(iii) An explanation of the measures DoD is taking to mitigate the
risk of using Russian Federation furnished energy.
225.7019-4 Solicitation provision and contract clause.
Unless a waiver has been granted in accordance with 225.7019-3--
(a) Use the provision at 252.225-7053, Representation Regarding
Prohibition on Use of Certain Energy Sourced from Inside the Russian
Federation, in solicitations, including solicitations using FAR part 12
procedures for the acquisition of commercial items and solicitations at
or below the simplified acquisition threshold, that are for the
acquisition of furnished energy for a covered military installation;
and
(b) Use the clause at 252.225-7054, Prohibition on Use of Certain
Energy Sourced from Inside the Russian Federation, in solicitations and
contracts, including solicitations and contracts using FAR part 12
procedures for the acquisition of commercial items and solicitations
and contracts at or below the simplified acquisition threshold, that
are for the acquisition of furnished energy for a covered military
installation.
PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
0
4. Add section 252.225-7053 to read as follows:
252.225-7053 Representation Regarding Prohibition on Use of Certain
Energy Sourced from Inside the Russian Federation.
As prescribed in 225.7019-4(a), use the following provision:
REPRESENTATION REGARDING PROHIBITION ON USE OF CERTAIN ENERGY SOURCED
FROM INSIDE THE RUSSIAN FEDERATION (AUG 2021)
(a) Definitions. As used in this provision--
Covered military installation means a military installation in
Europe identified by DoD as a main operating base.
Furnished energy means energy furnished to a covered military
installation in any form and for any purpose, including heating,
cooling, and electricity.
Main operating base means a facility outside the United States
and its territories with permanently stationed operating forces and
robust infrastructure.
(b) Prohibition. In accordance with section 2821 of the National
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92),
contracts for the acquisition of furnished energy for a covered
military installation shall not use any energy sourced from inside
the Russian Federation as a means of generating the furnished energy
for the covered military installation, unless a waiver is approved.
The prohibition--
(1) Applies to all forms of energy that are furnished to a
covered military installation; and
(2) Does not apply to energy converted by a third party into
another form of energy and not directly delivered to a covered
military installation.
(c) Representation. By submission of its offer, the Offeror
represents that the Offeror will not use or provide any energy
sourced from inside the Russian Federation as a means of generating
the furnished energy for the covered military installation in the
performance of any contract, subcontract, or other contractual
instrument resulting from this solicitation.
(End of provision)
0
5. Add section 252.225-7054 to read as follows:
252.225-7054 Prohibition on Use of Certain Energy Sourced from Inside
the Russian Federation.
As prescribed in 225.7019-4(b), use the following clause:
PROHIBITION ON USE OF CERTAIN ENERGY SOURCED FROM INSIDE THE RUSSIAN
FEDERATION (AUG 2021)
(a) Definitions. As used in this clause--
Covered military installation means a military installation in
Europe identified by DoD as a main operating base.
Furnished energy means energy furnished to a covered military
installation in any form and for any purpose, including heating,
cooling, and electricity.
Main operating base means a facility outside the United States
and its territories with permanently stationed operating forces and
robust infrastructure.
(b) Prohibition. In accordance with section 2821 of the National
Defense Authorization Act for Fiscal Year 2020 (Pub. L. 116-92), the
Contractor shall not use in the performance of this contract any
energy sourced from inside the Russian Federation as a means of
generating the furnished energy for the covered military
installation unless a waiver is approved. The prohibition--
(1) Applies to all forms of energy that are furnished to a
covered military installation; and
(2) Does not apply to energy converted by a third party into
another form of energy and not directly delivered to a covered
military installation.
(c) Subcontracts. The Contractor shall insert the substance of
this clause, including this paragraph (c), in subcontracts and other
commercial instruments that are for furnished energy at a covered
military installation, including subcontracts and commercial
instruments for commercial items.
(End of clause)
[FR Doc. 2021-18340 Filed 8-27-21; 8:45 am]
BILLING CODE 5001-06-P
