Alignment of Recommendations in EMD-79-105 With Senate Bill 885

A member of Congress requested views on how a proposed Senate bill aligns with three issues GAO raised in a recent report. The report addressed whether a proposed House bill could expose regional power consumers to more rate increases from construction cost overruns on non-Federal powerplants backed by the Bonneville Power Administration. It considered how passage or failure of the legislation would impact on Bonneville's direct service industrial (DSI) customers and on anadromous fishes in the Columbia River system. A brief review of the Senate bill revealed various amended provisions relating to these issues.

The Senate bill recognized the importance of sound contracting and oversight practices, but left the determination of what practices were proper to the discretion of the Administrator. The language of the bill provided a useful statement of purpose but failed to provide any of the specific contracting and oversight requirements recommended by GAO in the earlier report. The legislation provided that rates charged DSI customers would be tied to the cost of certain new power purchases before 1985, and thereafter to a level which the Administrator would determine to be equitable in relation to the retail rates charged by the region's public bodies and cooperatives to their industrial customers. The value of credits granted for power interruptions would also be determined by the Administrator. GAO continued to believe that opportunities exist for improving the energy efficiency of older production DSI facilities and the cost-effectiveness of providing various system reserves. Exploration of these potentials should be required before Bonneville is authorized to offer new contracts to the DSI customers. The Senate recognized as a desirable objective the enhancement of the anadromous fisheries in the Columbia River system. It provided for participation and consultation of fishery agencies in the development of regional plans and programs. GAO felt that the provisions were desirable but were not sufficiently strong to assure survival of the upriver fish runs. The earlier report indicated that time was a critical factor for some of the runs.