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On the question of what the DSI contracts should contain, we 

 offer the following comments: 



1. Bonneville should consider offering a range of contract 

 terms (a menu approach) for the DSIs, thus allowing 

 them to choose terms that are best suited toward them. 



Among the items on the "menu" should be contract length (e.g., 

 5-year, 8-year, 12-year or 20-years). Bonneville should consider 

 imposing some sort of penalty, similar to a "take or pay" 

 obligation, to discourage a DSI from requesting 20-year service 

 if the plant is likely to be in operation for only 5 years. 



The purpose behind such a provision is to protect Bonneville from 

 acquiring expensive new resources for the DSIs only to find that 

 the companies cannot sustain operations in the Northwest for 

 economic reasons. 



If that were to happen, Bonneville may have to sell the power on 

 the surplus market, a decision which will almost surely create 

 revenue problems and cause preference utilities, such as Canby, 

 to pay more in wholesale power rates. 



2. Investigate the costs and benefits to Bonneville of 

 increased interruptibility for the DSIs. 



At present, only one quartile (the first/top quartile) is 

 interruptible; the other three quartiles are considered firm. 

 Before offering contracts to the DSIs, Bonneville should consider 

 making one or more quartiles interruptible, thus increasing the 

 amount of interruptible service from 25 percent to 50 or 75 

 percent . 



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