84 



its own thinking pretty well together before it puts that out on the 

 table, it is also important that they put out on the table something 

 which is accessible to change and to criticism and comment by all 

 us in the region who are going to be affected. 



You really have raised a couple of questions. One of which is 

 unbundling of products and the second is the question of access to 

 the region's goods from reciprocal obligations back to the region. 

 And I think for analytical purposes, it is useful to separate those 

 two. I do not have a lot of serious heartburn, I guess, about 

 unbundling the services and making those available. You know, 

 one person's cherry picking is another person's market efficiency. 

 And it may well be that most of Bonneville's customers and the 

 rest of us are going to be better off if those products are unbundled 

 and priced in a way that we do not have to buy what we do not 

 need. It is going to be tricky, however, to figure out how to price 

 those and how to allocate those so, as you say, we do not leave 

 some parties, particularly those with relatively little market power 

 sitting on the outside looking in. There is a question, as the Admin- 

 istrator observed, of how you price those. And that is still an issue 

 that is very unclear in the region. I think overall the notion of sort- 

 ing through what we have to sell and what we have to buy is a 

 positive thing and is going to yield some real benefits for the re- 

 gion. 



The other question of how you tie access to those regional 

 goods — the value of the hydo system; the water that flows down; 

 the investment in the dams and the transmission lines; reciprocal 

 obligations that support the Power Act; and the Region's fish and 

 wildlife goals and so on — is a question that cannot be addressed en- 

 tirely separately but absolutely has to be addressed. Disagreement 

 is not the right word, but I think the Council members are still 

 sorting through how we think that ought to play out. Clearly, there 

 still needs to remain a linkage. A utility or a DSI ought not to be 

 able to, as you put it, cherry pick the region's goods and not have 

 any obligations back. 



Mr. DeFazio. Thank you. 



Ms. Merchant, if you will just keep it on the top of your mind 

 since my time has expired, I will ask you the same question when 

 my round begins. 



I will defer now to Mr. LaRocco. 



Mr. LaRocco. Thank you, Mr. Chairman. 



Mr. Hardy more or less described BPA as the AT&T of long dis- 

 tance telephone lines. I do not think any court is going to demand 

 that you, you know, go into regionals or, you know, break up. You 

 had mentioned that the utility market was changing all over the 

 country. Can you give me some idea whether this is a national phe- 

 nomenon or whether it is regional and whether there are any suc- 

 cess stories ahead of BPA that have been changing ahead of the 

 curve? 



Mr. Hardy. Clearly, it is a national phenomenon. I think you will 

 probably hear from some of the other utility witnesses today, even 

 though they are in this region, who are seeing the same future. I 

 would say that my experience in the industry has been that when 

 you get together, for instance, at an Electric Power Research Insti- 

 tute meeting, which is the opportunity I usually have where you 



