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BPA Plans Electrical Diversification by Staff Spokesman Review, July 14, 2006

Long-range plan could force local utilities to build their own power plants

Public utilities may have to build their own power plants or buy secondary electricity supplies rather than rely solely on the Bonneville Power Administration.

The proposal is part of long-range plan by Bonneville to boost and diversify the Pacific Northwest's electricity supply. The federal power-marketing agency released details of the plan Thursday.

Bonneville now pools all the power it needs to meet customers demand and comes up with a price for that total.

Most of the electricity is cheap, generated at the federal government's Columbia River dams and other power plants. The rest is often more expensive, as Bonneville must go out and buy the extra power on the open market.

In the end, the federal agency blends the power into a single rate.

Separating the cheap power from federal dams and the pricey power purchased on the open market would shift more responsibility to utilities starting five years from now. Utilities would be able to purchase their allotment of federal power at low cost, but likely would have to pay more if customer needs exceed the allotment and forced Bonneville to purchase in the higher-priced open market.

The federal agency's proposal is designed to encourage new power supplies as the region's electricity needs outstrip its power conservation measures.

"Knowing BPA's plans for the future will help other regional utilities make informed choices about their power supply and to do so early enough that adequate resources can be developed to meet growing demand," Steve Wright, BPA administrator, said in a prepared statement.

The proposal could affect the bills of thousands of people who buy power from public utilities such as Inland Power & Light, Kootenai Electric Cooperative, or Vera Water and Power.

Bonneville is accepting public comments on this "Long-Term Regional Dialogue Policy Proposal" through Sept. 29.