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substantial amounts of non-Federal generation provides for their use of the 

 storage capability of Federal reservoirs by increasing or decreasing the 

 amount of Federal power they purchase in any month, which is not a 

 service BPA small utilities without resources could make use of 



BPA's service packages are designed around the premise that BPA would 

 be the most efficient or lowest cost provider of the services in the package. 

 A major advantage of unbundling would be to allow this premise to be 

 tested, on a service-by-service basis, by the marketplace. Now is the 

 proper time to do so because competitive power supply options for BPA's 

 customers are increasing as the utility industry moves into a freer 

 marketplace environment. Unbundling would not necessarily mean that 

 BPA would stop providing a service, but does require BPA to identify the 

 costs of each of the different services it provides. It would allow BPA to 

 identify those specific services where BPA's ability to supply the service, 

 due to changes on the Federal System or for other reasons, may be 

 decreasing and to price those services accordingly. Identifying the cost 

 that each service places on BPA's system would allow BPA to offer 

 choices to its customers on whether BPA or another entity is the lowest 

 cost or most efficient provider of this service. Greater benefits will accrue 

 to the region where customers can expand the supply of valuable services 

 or provide the services at lower cost or more efficiently than BPA. 



Unbtmdling -will provide other advantages to the region. In some cases, a 

 BPA unbundled service will provide customer flexibility and value that is 

 lost when combined and priced with other services. For example, an 

 unbundled shaping service may be earemely valuable to customers with 



