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Question 4: Is BPA an effective indirect purchaser of regional resources through third-party 

 financing, biUing credits, conservation power plants and other indirect means? 



Answer: Bonneville is establishing itself in the marketplace as a credible business partner 



interested in acquiring cost-effective resources for the Pacific Northwest's 

 ratepayers. In the past three years, Bonneville has operated several different 

 acquisition processes. These processes include the first round of billing credits, a 

 pilot effort at an all-sources competitive acquisition for 300 average megawatts. 

 Targeted Acquisition Program for conservation, third-party financing, and 

 conservation power plants initiated by Bonneville's customer utilities. Bonneville's 

 success at each of these efforts has varied, depending on the circumstances, our 

 previous experience, and the degree of flexibility and control Bonneville has over 

 the process. Dealing with a truly competitive marketplace is challenging for a 

 Federal agency. In general, however, the ultimate decisions have been sound 

 business decisions in that Bonneville has acquired cost-effective resources for the 

 region. In addition, from these initial efforts, Bonneville has become more 

 knowledgeable in dealing with the processes involved, and is working to 

 incorporate the opportunities for improvements. Efforts currently underway 

 include are the Function by Function Review, Marketing Plan, and ultimately 

 Bonneville's Competitiveness Project. 



Third-Party Financing: Bonneville's efforts at using third-party financing 

 mechanisms for acquiring regional resources have generally been successfiil and 

 efficient. Several years ago, Bonneville financed the weatherization of several 

 thousand homes in the service territory of Eugene Water and Electric Board by 

 supporting bonds sold by that utility. Bonneville is currently negotiating third- 

 party financing opportunities for a wind demonstration project and for 



