290 



The table, which was filed as testimony in the 1993 Bonneville 

 rate case, was sponsored by the Northwest Conservation Act 

 Coalition (NCAC) and is reprinted here with that organization's 

 permission. 



Canby submitted a comment letter to Bonneville regarding the 

 value of DSI reserves. The letter called attention to the 

 importance of this testimony. The Canby letter is also included 

 in Attachnent A of this testimony. 



The NCAC testimony showed that the annual discount for the DSIs 

 is between $15 and $41 million above what it ought to be if 

 Bonneville could adjust the VOR to reflect current market 

 realities. 



In the table, the "Bonneville proposal" refers to the status quo 

 — it assumed nothing would change in the next two years (and the 

 IP-PF Rate Link would not be opened up for amendment). 



Scenario 1 assumed the current level of DSI reserves. The 

 interest rate, however, has been adjusted to reflect two current 

 market conditions: la assumes private developer financing (9%); 

 lb assumes municipal financing (6.5%). 



Scenario 2 adjusted the value of DSI forced outage reserves from 

 1,288 megawatts to 800 megawatts. The interest rate remains at 

 14 percent. 



Scenario 3 adjusted the value of DSI forced outage reserves from 

 1,288 megawatts to 600 megawatts. The interest rate remains at 

 14 percent. 



22 



