The US Department of Energy (DOE) recently published a notice of proposed rulemaking (NOPR) and request for comments in the Federal Register proposing a comprehensive revision of the Department of Energy Acquisition Regulation (DEAR). DOE’s proposal strives to update and streamline the DEAR’s policies, procedures, provisions, and clauses. DOE invites the public to submit written comments regarding this NOPR through the Federal eRulemaking Portal by no later than December 26, 2023.
As background, the DEAR implements and supplements the Federal Acquisition Regulation (FAR) for DOE’s specific needs. The FAR is the primary regulation that executive agencies use when acquiring supplies and services with appropriated funds.
Proposed Major Categories of Changes
DOE’s proposal encompasses four major categories of change:
- The first category of change seeks to update, clarify, or eliminate unclear, obsolete, or unnecessary duplicates of FAR’s coverage.
- The second category allows organizations to deviate from the FAR and DEAR by incorporating class deviations into the coverage.
- The third category seeks to streamline the DEAR’s policies and procedures by proposing various editorial revisions.
- Finally, the proposed rule seeks to standardize local DOE language by adding several new minor clauses, which would eliminate the multiple versions of local clauses in current use.
DOE claims that the revisions do not substantially change the currently existing DEAR or how DOE and DOE contractors adhere to the DEAR.
Nuclear Application Changes
In addition to the general changes, the nuclear industry should note three changes that are specific to nuclear applications:
- Section 901.103 clarifies that references to the Senior Procurement Executive (SPE) refers to both the DOE SPE and the National Nuclear Security Administration unless otherwise specified.
- Section 904.401 proposes to amend three nuclear terminology definitions—“access authorization,” “counterintelligence,” and “classified information”—to be harmonious with Executive Orders 12958 and 13526.
- Section 952.250-70 proposes to revise the “Nuclear Hazards Indemnity Agreement” clause to correctly reflect the current underlying statute, eliminate “effective date” considerations not germane to contracts awarded post 2020, and eliminate the exclusion from civil penalties for certain identified nonprofit institutions.
Potential Added Costs
While DOE claims that most revisions would not generate any additional costs for contractors, there are three noteworthy exceptions. The first exception is a proposed revision of the “Facility Clearance” clause to incorporate a pre-award interim access procedure and allow for final facility clearance post-award.
The second exception is a proposed revision of the management and operating (M&O) fee policy.
The last exception would add seven new contract clauses, which predominantly involve M&O contracts:
- Section 970.1708: Agreements for Commercializing Technology (ACT)
- Section 970.5219: Small Business Subcontracting Plan
- Section 942.7100: Conditional Payment of Fee, Profit, and Other Incentives
- Section 952.203-1: Identification of Contractor Employees
- Section 970.5222-4: Unemployment Compensation
- Section 970.5209-70: Conflicts of Interest
- Section 904.7401: Contract Clause
DOE has stated that the public benefits from the proposed changes outweigh the potential burdens.
The government’s comprehensive update in the Federal Register is a sign that the department is trying to keep up with the times—the last comprehensive DEAR update was decades ago. The regulation requires buffing and polishing to remain applicable to current laws, regulations, orders, and department practices.
Morgan Lewis will continue to monitor developments in this important area.