Parsons Awarded $20 Million U.S. Army Corps of Engineers Contract for Puerto Rico Microgrid

Rhea-AI Summary

Parsons (NYSE: PSN) has secured a $20 million contract from the U.S. Army Corps of Engineers Louisville District for the LTC Hernan G. Pesquera Army Reserve Center Microgrid project in Puerto Rico. The 610-day project involves installing a comprehensive microgrid system, including security measures, generators, photovoltaic cells, battery storage, and controllers.

This new contract builds upon Parsons' existing work in Puerto Rico, following their November 2023 selection for a $5 billion multiple-award contract to provide temporary power generation for Puerto Rico's power grid stabilization project. The company will implement critical infrastructure protection capabilities to enhance energy reliability, resilience, and sustainability at the Army Reserve Center in Juana Diaz.

Positive

• Secured new $20 million contract for microgrid project
• Contract adds to existing $5 billion ceiling value contract in Puerto Rico
• Expands presence in critical infrastructure and energy solutions sector

Negative

• None.

Insights

Energy Infrastructure Analyst

The $20 million USACE microgrid contract represents a strategic expansion of Parsons' energy infrastructure portfolio. The project's comprehensive scope, including photovoltaic cells, battery storage and microgrid controllers, demonstrates advanced technical capabilities in resilient power systems. Most notably, this contract complements Parsons' recent $5 billion IDIQ award for Puerto Rico's power grid stabilization, positioning the company as a key player in the region's critical infrastructure modernization. The 610-day performance period suggests careful project staging and implementation, while the integration of security measures indicates a holistic approach to infrastructure protection. This contract enhances PSN's foothold in the growing federal energy resilience market, particularly valuable given Puerto Rico's vulnerability to natural disasters and grid instability. For investors, this represents positive momentum in Parsons' strategic pivot toward higher-margin technical solutions and recurring revenue streams in the energy sector.

Federal Contracting Expert

The contract award exhibits several favorable characteristics from a federal procurement perspective. First, it's classified as "new work," indicating business expansion rather than contract renewal. Second, the integration with the larger $5 billion IDIQ demonstrates Parsons' ability to leverage multiple contract vehicles in a strategic market. The Army Reserve project serves as a proof-of-concept for similar installations, potentially leading to additional military microgrid contracts. The comprehensive technical requirements suggest minimal subcontracting needs, allowing for higher profit retention. The project's scope aligns with federal mandates for energy resilience and sustainability, positioning Parsons favorably for future Department of Defense energy infrastructure projects. This contract represents more than just its $20 million face value - it's a strategic stepping stone for capturing larger shares of the federal energy modernization market.

CHANTILLY, Va., Dec. 18, 2024 (GLOBE NEWSWIRE) -- Parsons Corporation (NYSE: PSN) announced today that the company was awarded the LTC Hernan G. Pesquera Army Reserve Center Microgrid contract by the United States Army Corps of Engineers (USACE) Louisville District. The $20 million contract, including base plus options, to enhance energy resilience and sustainability for the Pesquera Army Reserve Center in Puerto Rico consists of a 610-day period of performance and is new work for the company.

Under this contract, Parsons will deliver critical infrastructure protection capabilities designed to enhance energy reliability, resilience, and sustainability for the Army Reserve Center in Juana Diaz, Puerto Rico, including installing security measures, generators, photovoltaic cells, a Battery Energy Storage System, microgrid controllers, and all necessary cabling to ensure a robust and efficient microgrid system.

“Energy is a vital component of critical infrastructure protection, and Parsons’ leading energy solutions combined with our other technology offerings enable us to deliver end-to-end capabilities to secure facilities and bases,” said Jon Moretta, President, Engineered Systems for Parsons. “By leveraging our comprehensive solutions and experience delivering large-scale energy projects, we’re proud to advance the power stability and energy efficiency goals of the Army Reserve in Puerto Rico and the Army’s broader energy objectives.”

This award grows Parsons’ work supporting Puerto Rico’s infrastructure. In November 2023, the company announced its inclusion on a multiple award indefinite-delivery, indefinite-quantity task order contract for the Puerto Rico Power System Stabilization Project. The $5 billion ceiling value contract by the USACE Savannah District is to provide temporary power generation for the stabilization of Puerto Rico’s power grid, supporting the government’s request for assistance and aiding residents of the island as they recover from natural disasters.

To learn more about Parsons’ leading energy solutions, visit Parsons.com/energy.

About Parsons:
Parsons (NYSE: PSN) is a leading disruptive technology provider in the national security and global infrastructure markets, with capabilities across cyber and intelligence, space and missile defense, transportation, environmental remediation, urban development, and critical infrastructure. Please visit parsons.com and follow us on LinkedIn and Facebook to learn how we're making an impact.

Forward-Looking Statements:
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on our current expectations, beliefs and assumptions, and are not guarantees of future performance. Forward-looking statements are inherently subject to uncertainties, risks, changes in circumstances, trends and factors that are difficult to predict, many of which are outside of our control. Accordingly, actual performance, results and events may vary materially from those indicated in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results or events. Numerous factors could cause actual future performance, results and events to differ materially from those indicated in the forward-looking statements, including, among others: any issue that compromises our relationships with the U.S. federal government or its agencies or other state, local or foreign governments or agencies; any issues that damage our professional reputation; changes in governmental priorities that shift expenditures away from agencies or programs that we support; our dependence on long-term government contracts, which are subject to the government’s budgetary approval process; the size of our addressable markets and the amount of government spending on private contractors; failure by us or our employees to obtain and maintain necessary security clearances or certifications; failure to comply with numerous laws and regulations; changes in government procurement, contract or other practices or the adoption by governments of new laws, rules, regulations and programs in a manner adverse to us; the termination or nonrenewal of our government contracts, particularly our contracts with the U.S. federal government; our ability to compete effectively in the competitive bidding process and delays, contract terminations or cancellations caused by competitors’ protests of major contract awards received by us; our ability to generate revenue under certain of our contracts; any inability to attract, train or retain employees with the requisite skills, experience and security clearances; the loss of members of senior management or failure to develop new leaders; misconduct or other improper activities from our employees or subcontractors; our ability to realize the full value of our backlog and the timing of our receipt of revenue under contracts included in backlog; changes in the mix of our contracts and our ability to accurately estimate or otherwise recover expenses, time and resources for our contracts; changes in estimates used in recognizing revenue; internal system or service failures and security breaches; and inherent uncertainties and potential adverse developments in legal proceedings, including litigation, audits, reviews and investigations, which may result in materially adverse judgments, settlements or other unfavorable outcomes. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. For a discussion of additional factors that could materially adversely affect our business and financial performance, see the factors included under the caption “Risk Factors” in our Registration Statement on Form S-1 and our other filings with the Securities and Exchange Commission. All forward-looking statements are based on currently available information and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statement made in this presentation that becomes untrue because of subsequent events, new information or otherwise, except to the extent we are required to do so in connection with our ongoing requirements under federal securities laws.

Media Contact:                                        
Jonathan Larry
+1 706.832.7330
jonathan.larry@parsons.com

Investor Relations Contact:
Dave Spille
+1 703.775.6191
Dave.Spille@parsons.us

FAQ

What is the value and duration of Parsons' (PSN) new Army Corps microgrid contract?

The contract is valued at $20 million (including base plus options) with a 610-day period of performance.

What services will Parsons (PSN) provide for the Puerto Rico Army Reserve Center microgrid?

Parsons will install security measures, generators, photovoltaic cells, a Battery Energy Storage System, microgrid controllers, and necessary cabling for a comprehensive microgrid system.

How does this contract relate to Parsons' (PSN) other work in Puerto Rico?

This contract follows Parsons' November 2023 selection for a $5 billion ceiling value contract for the Puerto Rico Power System Stabilization Project.

Where will Parsons (PSN) implement the new microgrid system in Puerto Rico?

The microgrid system will be implemented at the LTC Hernan G. Pesquera Army Reserve Center in Juana Diaz, Puerto Rico.