38 



doesn't, who is getting subsidized, and whether those are values 

 today that we wish to go forward with. 



I mean not everybody is going to want to get rid of every kind 

 of subsidy that is in the system, but we are going to, in a sense, 

 flesh out in the open, and that undoubtedly leads to some very dif- 

 ficult times for you folks and for the public at large as that gets 

 sorted out again. But I appreciate your very concise view of things. 

 Thank you. 



Mr. DeFazio. I thank Mr. Sharp for his remarks. 



The Administrator and I had some discussion of this in the inter- 

 rogatory phase beforehand. What we agreed on was that this is a 

 public entity and everything is going to be on the table, even if just 

 by asking some of these questions I make people uncomfortable or 

 other members of the committee make people uncomfortable. 



You know, you have to learn to live with it because we want to 

 make our decisions about the future with fiill awareness of all the 

 implications for all the customers of the utility, and I think the Ad- 

 ministrator is aware of that and, I think, in fact, supportive. 



Mr. Thomas. 



Mr. Thomas. Thank you. Just a couple of questions. 



Do you have criteria for to whom you sell power, as most of the 

 other Power Marketing Agencies do? Are they nonprofits? Are they 

 municipals? Are they co-ops? Or are they anybody that is in your 

 area? 



Mr. Hardy. We have several pieces of legislation, Mr. Thomas, 

 that govern whom we sell power to and what kind of priority or 

 preference they get. Like the other Power Marketing Agencies, pub- 

 lic preference requires us to give first priority in power sales to 

 publicly owned utilities, both municipals and co-ops. We also have 

 long-term contracts to sell directly to 15 major industrial cus- 

 tomers, primarily aluminum companies. 



We don't make any significant wholesale power sales to the in- 

 vestor-owned utilities in our region. However, we do provide them 

 with a variety of transmission services. We also make surplus 

 power sales to California utilities and other out-of-region entities. 

 Those are governed primarily by the Transmission System Act, 

 what is called regional preference, where before we can make any 

 sale to a California utility or an out-of-region utility we have to 

 offer that same amount of power for purchase within the North- 

 west first. 



Mr. Thomas. Do you have an average wholesale rate? 



Mr. Hardy. Yes. Our average wholesale rate is roughly 24 mills. 



Mr. Thomas. Compare that to the other Power Marketing Agen- 

 cies. 



Mr. Hardy. It is, I believe, lower than the other Power Market- 

 ing Agencies. I don't know what 



Mr. Thomas. Quite a bit lower, isn't it? 



Mr. Hardy. Yes, it is. 



Mr. Thomas. You don't know what the others are? 



Mr. Hardy. I am not familiar with the exact rates of each one 

 of them right now. 



Mr. Thomas. Who pays for the changes in both capital and oper- 

 ating for fish and wildlife? Does that come out of power revenues? 



Mr. Hardy. Yes, sir, it does. 



