Comments on Issue Paper Reference to GAO's Pacific Northwest Report

The brief treatment which the Bonneville Power Administration (BPA) gave to some recommendations made to it concerning Congressional action, did not convince GAO that the points of contention have been thoroughly analyzed and properly resolved. Specifically, two areas should be commented on in more detail than have been presented by the BPA. The first is the area of financial participation by BPA in conventional thermal powerplants. The proposed legislation provides such authority while the position of GAO was that, until more information is available, BPA should avoid making firm commitments in the near future to help finance conventional thermal powerplants. The second area that could be expanded is that dealing with the GAO recommendation to add a surcharge on federal hydropower and keep the preference customer clause as is. Analysis showed that the Northwest will face higher power costs if increased demand is met by thermal powerplants rather than by conservation and renewable resource programs. Thus, the question to be answered is: how can rate disparities be decreased and power needs be met with minimum capital and environmental costs? The GAO response was to gradually increase the price of federal power until it reaches parity with the average price of producing power in the Northwest. Also, by investing in conservation and renewable energy sources, the region would not become dependent on external fuel supplies.