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market-driven environment. 



VII. The competitive marketplace requires more Innovative 

 program implementation. 



Before I close, I want to address some other issues that have been 

 raised by the task force: Namely, how Bonneville manages costs related to 

 fish and wildlife protection and conservation. 



We recognize that Bonneville faces tremendous environmental 

 pressures mandated by federal statutes. As a Bonneville customer, we 

 expect to pay our fair share - and as I mentioned earlier. Pacific 

 customers account for one of every ten dollars Bonneville spends. At the 

 same time, we believe the investments Bonneville is making in fish and 

 wildlife programs could be targeted more effectively to meet statutory 

 requirements. Better prioritization could ultimately reduce costs. We 

 also recognize that much of BPA's Fish and Wildlife Program is driven by 

 measures adopted by the Northwest Power Planning Council on behalf of 

 regional fish agencies and tribes. However, the agency appears to be 

 funding far more programs than it needs to, with little evidence that the 

 environmental benefits warrant all of the expenditures. This is an area 

 where Bonneville, its customers, the Council, fish agencies and tribes all 

 need to work together to ensure good results. 



We have similar concerns about conservation financing, which also 

 has had a tremendous impact on Bonneville's budget and rates. We have 

 encouraged the agency to look at creative methods for financing 

 conservation programs. We have advocated an approach that more closely 

 assigns the costs of a conservation program to the customer who benefits 

 from it. Spreading conservation costs across a broad section of 

 customers, regardless of who gets the conservation benefit, creates 

 inequities. Conversely, an approach whereby the customer receiving most 

 of the benefits pays most of the costs would minimize rate impacts on 

 other, non-benefitting customers. 



Our conservation programs based on this "energy service charge" 

 concept have been well-received by certain market segments, particularly 

 commercial and industrial customers, and might work well for some 



