Options are periods of performance that are as the name suggests optional for the government. I would caution against the use of option years, as option periods do not have to be a year. An option could be a six-month period of performance or any other item. For instance, in construction contracting, you may have a contract to build a base overseas. Optional items on the contract may include additional buildin such as a dining facility, church, recreational center, etc. The goverment does not have to exercise an option. Meaning the government must have a bone fide need to exercise the option. Contracts with options have a base period of performance and option periods of performance. See FAR subpart 17.2; see also DFARS subpart 217-2.

Indefinite delivery indefinate quantity, Basic Ordering Agreements and Blanket Purchase Agreements are covered in FAR part 16. Be mindful, that agreements are not contracts - they are agreements covered under FAR subpart 16.7. Contracting officers place orders againt BOAs and BPAs for supplies and services covered by that agreement. Task orders and delivery orders may have option periods.

Also see https://www.dau.edu/aap/pages/ArticleContent.aspx?itemid=18271