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Question 10; How should the long-term power contracts that BPA is currently 



negotiating differ from the current contracts? What, if any, environmental 

 issues should be addressed in these contraas? 



Answer: The current contracts are based on the premise that power services can be 



provided most efiSciently and at least cost through centralized and 

 coordinated regional planning. The current contracts allow customers to 

 make their own resource choices at the cost of giving up their supply of 

 Federal power. The terms and conditions of new long term contracts will 

 reflect the region's conclusion as to what the future business relationship 

 between BPA and its customers should be. This relationship could include 

 BPA oflfering unbundled services and pricing some services using tiered 

 rates. Tiered rates would allow customers to choose among pursuing their 

 own resource choices without giving up their supply of low-cost Federal 

 power, continuing to rely on BPA provision of their resources, or choosing 

 a combination of both strategies. As customers develop resources, each 

 customer's need for different services from BPA will change. Unbundled 

 services would allow BPA to respond to those needs. 



What environmental issues should be addressed in BPA's long term power 

 contracts again depends on the type of business relationship between BPA 

 and its customers. BPA has historically asked that its customers meet the 

 environmental standards placed on them by Congress, Federal agencies, 

 and their respective state and local government bodies as a condition of 

 receiving Federal power. BPA has addressed environmental issues in the 

 choices it makes in its investments and decisions to operate the Federal 

 system to serve its customers and refleaed the costs of those 

 environmental issues in its rates. In a more competitive elearic power 



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