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conservation acquisitions for a consortium of utilities in the state of Washington 

 (Conservation and Renewable Energy System). Bonneville's Office of Financial 

 Management recently developed guidelines for acquisitions for third-party 

 financing to ensure that Bonneville's financial interests are sufficiently protected 



Billing Credits: Bonneville recently completed its first round of billing credit 

 proposals. The agency received 89 proposals and ultimately expects to acquire 

 about 25 average megawatts of cost-effective resources for the region. Bonneville 

 is currer^'y incorporating suggestions for streamlining the process into a second 

 round of billing credits now underway. 



Competitive Bidding: As part of the 1990 Resource Program, Bonneville 

 undertook a pilot effort at an ail-sources competitive bid for 300 average 

 megawatts. Bonneville has successfiilly completed memoranda of 

 understanding for 293 average megawatts of generating resources, largely gas- 

 fired, which are now beginning their final environmental and approval 

 processes. Presently, Bonneville is in negotiation with several energy service 

 companies for about 60 average megawatts. We acknowledge the need to 

 improve this type of competitive process, and are seeking improvements, 

 particularly in the negotiation phase. 



Conservation Power Plants: Utility-initiated proposals that encompass all 

 conservation acquisitions in a utility's service territory are known as "conservation 

 power plants". The success of this acquisition effort is not yet clear, as these 

 efforts have been more complex than our customers initially expected. For 

 example, we soon expect to sign a contract with Emerald People's Utility District 

 to acquire cost-effective conservation in Emerald's service territory. We regret, 



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