THE BPA PROPOSAL: CRITERIA FOR SELECTION

It was earlier mentioned that one of the perceived deficiencies in the BPA's Draft Role EIS was lack of an explicitly identified BPA proposed action or program among the numerous alternatives discussed. Among other things, the Revised Draft Role EIS more clearly identified such a proposal. It will be described shortly.

At the time the Revised Draft Role EIS was being prepared, potentially farreaching Northwest power legislation was being considered in the Congress. If that or similar legislation is enacted, BPA's authority and responsibilities would be very significantly altered.

One of the proposed bills, originally introduced in the 95th Congress (S. 3418 and H.R. 13931) as the "Pacific Northwest Electric Power Planning and Conservation Act," has been reintroduced in the 96th Congress as S. 885 and H.R. 3508. This legislation has been designed to address and solve the electric power problems confronting the Pacific Northwest. This proposed legislation was conceived on the basis of a general, although not universal, regional consensus. The proposed legislation was originally introduced in both houses of Congress by leading members of the Northwest congressional delegation, and was the subject of congressional hearings both in Washington, D.C., and across the region. As a result, numerous amendments were offered to improve it. The legislation was endorsed in principle, although by no means in every detail, by the national administration. It was not, however, an administration or BPA bill.

Another legislative proposal was put forward by Representative James Weaver of Oregon's Fourth Congressional District. His bill, the "Northwest Renewable Resources, Conservation, and Energy Planning Act" (H.R. 4159), proposes alternative mechanisms for resolving regional power issues.

Neither BPA nor any other executive branch agency can properly conjecture on the final outcome of a proposal before Congress which is not an administration proposal and the enactment of which is speculative and prospective. On the other hand, it would be disingenuous to ignore proposed legislation and, by implication, pretend that it does not exist. It is much too important. And it is not at all implausible to assume that it or a variant thereof might sooner or later be enacted.

The formulation of a BPA proposal was additionally influenced by many comments on the Draft Role EIS which urged selection of a proposal which was more specific-action oriented and with more emphasis on energy conservation than had appeared in the original draft. In view of these circumstances and in response to such comments, a number of selection criteria were established, to wit:

1. The BPA proposal should conform with executive agency protocol; hence, it should not depend on the speculative outcome of any pending legislation not proposed by BPA or the national administration.

2. The BPA proposal should be based essentially on the exercise of existing legislative authority, a known and available quantity.

3. The BPA proposal should be identified with more precision and more detail, without ambiguity.

4. The BPA proposal should be realistic; it should represent a plausible outcome.

5. The BPA proposal should have been encompassed within the original Draft Role EIS, the predecessor to this document.

6. Within existing legislative authority and to the extent possible, BPA should adopt policies that will support the goal of planning and operating the regional power system under the one-utility concept.

7. The BPA proposal should include a vigorous energy conservation policy that is realistic and feasible under existing legislative authority.

8. In recognition of the dynamic setting within which future regional power plans and programs must be executed, the BPA proposal should allow for endorsement in principle of additional prospective legislative authority that would (1) reinforce and strengthen the likelihood of achieving the goal of planning and operating under the one-utility concept, (2) provide additional tools to achieve regional electric energy conservation, and (3) respect existing broad institutional arrangements and political realities.

In the absence of selection criteria, any number of alternatives might be regarded as candidates for the BPA proposal. The range extends from one extreme in which new Federal legislation would be enacted to significantly reduce BPA's role in the region to another extreme in which new Federal legislation would create a regional power authority involving large-scale alterations in existing institutional arrangements. Within these two extremes are an almost infinite array of possibilities, the two most realistic and likely of which are

(1) energetic utilization of existing legislative authority, and (2) new legislative authority along the lines of proposed legislation introduced in the 95th Congress. It is the former of these two alternatives that has been selected as the BPA proposal, with an added feature allowing for endorsement of additional legislative authority that would further improve attainment of the one-utility concept and energy conservation objectives.

The most compelling reason for selection of existing legislative authority as the framework within which the BPA proposal should be structured is that it is a known and currently available quantity, a

course of action that can be implemented with a high degree of certainty. Power planning decisions in the region await resolution. Time marches on. Congress may or may not act on proposals for new legislation. The potential for serious power shortages looms on the horizon. Uncertainties about the future allocation of Federal power resources interfere with planning efforts. Lawsuits are pending. A kind of paralysis and malaise has overtaken the decisionmaking process. However effective some legislative proposals might be in overcoming the region's power planning problems, what proposed legislation might ultimately look like or when, if ever, it would be enacted, cannot be accurately predicted.

In this setting of large uncertainties it is better to develop an optimum program within a known framework (existing authority) than to do nothing at all or to rely on abstractions and speculations which may or may not materialize. The BPA proposal is straightforward and simple: proceed expeditiously to do the best that can be done under existing authority to solve the region's energy problems. If, after such a proposal is adopted and implemented, something conceptually and functionally superior is provided by way of new Federal legislative authority, BPA and the Northwest can be expected to take full advantage of its provisions. If, on the other hand, BPA and the region are left with no more legislative authority than at present, at least the best will be made of the circumstances.

In the meantime, this Final Role EIS does not ignore the alternative of regional power legislation. First, as has been stated, the BPA existing authority proposal allows for endorsement in principle of new complementary authority. Second, to be as forthright as possible and to provide the public and decisionmakers with a full understanding of the implications and potentials encompassed by the proposed legislation, that alternative will also be described (as a "preferred" or "ranking" ancillary candidate), along with three other alternatives, in the main body of this Final Role EIS (i.e., in terms of actions and impacts). The key features of that ranking alternative will also be arrayed in this overview alongside the features of the BPA proposal. Thus, a side-by-side analysis of the two most likely or realistic choices will be facilitated.

THE BPA PROPOSAL: KEY ELEMENTS

The BPA proposal is predicated on several key assumptions:

1.

BPA will operate under its existing legislative authority.

2. BPA rates will be set at a level that will fully recover all costs of operating and constructing the Federal Columbia River Power System (FCRPS) including the costs of acquired power and timely repayments of the Federal investment, plus interest.

3. To the extent feasible within existing authority, BPA will implement new programs and/or modify existing programs that are calculated to move closer towards achievement of the one-utility concept.

4. Within existing authority, BPA will expand its energy conservation program and its public involvement program as much as it appropriately and feasibly can.

5. The high level of interutility cooperation that has been forged by power entities in the Pacific Northwest will be maintained.

6. BPA will endorse, in principle, proposals that enhance the prospect of achieving the one-utility concept, including additional authority for implementation of regional energy conservation programs.

7. BPA will continue in its role as coordinator for interregional transmission expansion opportunities.

The BPA proposal can be conveniently described in terms of eight areas of activity: (1) customer services, (2) transmission planning and services, (3) power planning, (4) conservation, (5) sources of power, (6) sales, (7) rates, and (8) public involvement. It is described in detail in Chapter III of this Final Role EIS.

With respect to (1) customer services, upon request BPA will continue to integrate new and existing non-Federal generating resources into the FCRPS in order to facilitate regional coordination of generation and transmission. All BPA costs would be borne by the beneficiaries of its services. The specific customer services that BPA would offer would include load factoring, forced outage reserves, load growth reserves, trust agent functions, resource information clearinghouse services, and miscellaneous services.

With respect to (2) transmission planning and services, BPA would continue to plan, build, and operate its transmission system in coordination with the region's utilities to reflect the one-utility concept. BPA would continue to provide transmission services such as wheeling non-Federal power, transmission of excess non-Federal generation capacity over existing lines, short-term transfers of nonfirm energy and capacity if and when sufficient transmission capacity is available, and

point-to-point transfer of power over its facilities when excess transmission capacity is available.

With respect to (3) power planning, BPA would make maximum use of existing authorities in implementing, coordinating, and facilitating regional power planning to ensure optimum economic efficiency in the design and operation of the regional power system. Power planning functions would include development of planning assumptions, load forecasting, preparation of an annual power planning document, identification of resource sites, and cooperative activities.

With respect to (4) conservation, BPA would proceed with conservation efforts making maximum use of present authority while also being mindful that new legislation might allow for enlarged efforts to achieve greater conservation results. BPA would follow a policy designed to achieve as much cost-effective and feasible regional electric energy conservation savings as is practicable. That policy is described in greater detail in the main body of this EIS.

With respect to (5) sources of power, BPA would not acquire any significant amounts of new non-Federal resource capability beyond that provided for under existing agreements but would continue to offer FCRPS services to integrate new regional resources into the system. BPA would encourage development of cost-effective and feasible renewable resources including additional hydro and unconventional resources, and would play an expanded role in the investigation and assimilation into the power system of such resources.

With respect to (6) sales, preference and priority for public bodies and cooperatives would continue. As existing power sales contracts expire, BPA would have to reallocate its limited power supplies in a fashion that accords with existing legislation. A proposed BPA power allocation policy was announced in 1979. Regional power legislation would likely obviate the need for reallocation.

With respect to (7) rates, new wholesale power rates were made effective December 20, 1979, satisfying BPA's legal obligation to produce sufficient revenue to recover all of the costs of producing and transmitting power including timely repayment of the Federal investment in the FCRPS plus interest, and of making BPA power available at the lowest possible cost consistent with sound business principles.

With respect to (8) public involvement, BPA would maintain and, where feasible, expand public participation in its policy formulations and in regional power planning in terms of formal requirements such as notice, review, and comment, and in terms of other nonrequired procedures such as workshops, mailings, public meetings, hearings, and other mechanisms that ensure that the public is given an adequate opportunity to consider proposals, express comments, and have those comments carefully considered.