As prescribed in 970.1504-5(c), insert the following clause:
Cost Reduction (AUG 2009)
Design, process, or method change is a change to a design, process, or method which has established cost, technical and schedule baseline, is defined, and is subject to a formal control procedure. Such a change must be innovative, initiated by the Contractor, and applied to a specific project or program.
Development cost is the Contractor cost of up-front planning, engineering, prototyping, and testing of a design, process, or method.
DOE cost is the Government cost incurred implementing and validating the CRP.
Implementation cost is the Contractor cost of tooling, facilities, documentation, etc., required to effect a design, process, or method change once it has been tested and approved.
Net Savings means a reduction in the total amount (to include all related costs and fee) of performing the effort where the savings revert to DOE control and may be available for deobligation. Such savings may result from a specific cost reduction effort which is negotiated on a cost-plus-incentive-fee, fixed-price incentive, or firm-fixed-price basis, or may result directly from a design, process, or method change. They may also be savings resulting from formal or informal direction given by DOE or from changes in the mission, work scope, or routine reorganization of the Contractor due to changes in the budget.
Shared Net Savings are those net savings which result from-
(End of clause)
48 C.F.R. §§970.5215-4