8 



We are going to do three things. We are going to get ourselves 

 more efficient, and as part of that exercise, we announced on Mon- 

 day to the Bonneville work force that we are going to downsize by 

 600-800 employees saving $75-100 million. That is a 15 percent 

 downsizing over the next 4 years and is similar to what other utili- 

 ties have done. Furthermore, we are going to unbundle our services 

 to try to create a greater mix of products and services. And in that 

 context we are moving in the direction that former Congressman 

 Weaver suggested in terms implementing some sort of tiered rate 

 structure. And we are going to change our culture. 



I would like ta discuss the next steps in this process. We have 

 some graphics to illustrate this. The development of a business 

 plan with strategic business objectives, development of a marketing 

 plan, and a function-by-function review illustrate the efficiency ex- 

 ercises we are going through. 



I will just conclude by making one basic observation. Change is 

 inevitable. We can either take advantage of it and bend it to our 

 needs and realize that opportunity, or we can be victimized by it. 

 The failure to take action has serious consequences. First, it is un- 

 coordinated resource development. It is customers going out on 

 their own, and it is a dramatic departure from the structure that 

 the Regional Act envisioned with the NW Power Planning Council 

 involved in resource planning. Second, it is increased rates with all 

 the consequences. Third, it is missed Treasury pajnnents with all 

 the political consequences attendant with that. Fourth and finally, 

 it is unstable or declining fish funding and funding for our other 

 environmental obligations. While that is a worst-case scenario, it is 

 a very realistic one. That is what we seek to avoid. 



Thank you, Mr. Chairman. 



Mr. DeFazio. Thank you. 



Mr. Trulove. 



[Prepared statement of Mr. Hardy follows:] 



