FAR and DFARS › DFARS Part 241: Acquisition of Utility Services › Subpart 241.2
DFARS 241.202 Procedures.
The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.
In plain English
This section sets rules for how the Government handles connection and service charges when acquiring utility services. It establishes an order of precedence for how these charges are treated in contracts, from no charge to nonrefundable charges, and requires approval for certain alternatives. It matters to contractors because it affects whether and how they can be reimbursed for connecting facilities and related costs.
Applies to: Contracts for utility services, specifically connection and service charges
What it requires
- Use a termination liability instead of a connection charge only with approval of the service power procurement officer or designee
- Provide for refund of a refundable connection charge within five years unless a longer period or omission is authorized
- Follow the procedures at PGI 241.202(2) for construction and labor requirements
Key terms: connection charge · service charge · termination liability · refundable connection charge · nonrefundable charges
Written by AI from this section's text. A guide, not legal advice: the text below rules.
The text
(1) Connection and service charges. The Government may pay a connection charge when required to cover the cost of the necessary connecting facilities. A connection charge based on the estimated labor cost of installing and removing the facility shall not include salvage cost. A lump-sum connection charge shall be no more than the agreed cost of the connecting facilities less net salvage. The order of precedence for contractual treatment of connection and service charges is—
(i) No connection charge.
(ii) Termination liability. Use when an obligation is necessary to secure the required services. The obligation must be not more than the agreed connection charge, less any net salvage material costs. Use of a termination liability instead of a connection charge requires the approval of the service power procurement officer or designee.
(iii) Connection charge, refundable. Use a refundable connection charge when the supplier refuses to provide the facilities based on lack of capital or published rules which prohibit providing up-front funding. The contract should provide for refund of the connection charge within five years unless a longer period or omission of the refund requirement is authorized by the service power procurement officer or designee.
(iv) Connection and service charges, nonrefundable. The Government may pay certain nonrefundable, nonrecurring charges including service initiation charges, a contribution in aid of construction, membership fees, and charges required by the supplier's rules and regulations to be paid by the customer. If possible, consider sharing with other than Government users the use of (and costs for) facilities when large nonrefundable charges are required.
(2) Construction and labor requirements. Follow the procedures at PGI 241.202(2) for construction and labor requirements associated with connection and service charges.
← 241.201 Policy. · 241.205 Separate contracts. →
Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.