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BPA Releases Regional Dialogue Policy by Staff BPA Journal, August 2007

BPA released its Long-Term Regional Dialogue Policy and accompanying Record of Decision July 19 after five years of efforts by BPA, its customers and other regional stakeholders. The policy and ROD define BPA's long-term power supply role for the region in a way that keeps the economic benefits of the Federal Columbia River Power System in the Northwest and ensures the agency's ability to meet its U.S. Department of Treasury obligations. This release marks a major milestone in advancing key national and regional goals and prepares the way for post-2011 BPA power sales contracts. These contracts will provide Northwest utilities with greater certainty to prepare for their future energy needs.

A primary focus of the policy is on the products and services that will be available to publicly owned utility customers through long-term contracts. The policy also proposes a tiered rate structure which defines the amount of energy each publicly owned utility can purchase at the cost of the existing federal system, referred to as a Tier 1 rate. A Tier 2 rate would be used for energy purchased beyond this established amount to serve customer load growth and would be designed to recover BPA's costs of securing additional resources to serve the higher load. Tiering the rates should create a strong incentive for customers to pursue conservation to lessen the need to purchase power at the higher priced Tier 2 rate.