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the environmental costs would be too high. In the late 1980s, after listening to regional 

 concerns about environmental protection, the Council placed some 44,000 miles of 

 streams off limits to future hydropower development. Similarly, the Council decided 

 that no degradation of indoor air quality from conservation measures was acceptable. 



Bonneville deals with environmental externalities more specifically, on a site-by- 

 site basis in the context of resource acquisition. The impacts considered include 

 emissions of sulfur dioxide, oxides of nitrogen, particulates and impacts to land and 

 water. Considering that this is an evolving technology, Bonneville's approach to date 

 is adequate. 



There have been difficulties. For example, Boimeville proposed accounting for 

 carbon dioxide emissions but was overruled by the Department of Energy. We expect 

 that this decision will be reconsida-ed as U.S. policy on global climate change is 

 revised. 



Finally, since adoption of the 1991 Power Plan in April of that year, the Council 

 staff has been concentrating on improving its understanding of the environmental 

 characteristics of resources in the plan. We are developing the analytical tools to 

 account for these characteristics in the planning process, and we are critically reviewing 

 the various methods for including envirorunental impacts in plaiming decisions. This is 

 an evolving area of inquiry that has high levels of uncertainty. The intent is to be able 

 to take environmental impacts into account in a more accurate and systematic way than 

 has been done in the past. 



Next Steps 



Our testimony focuses on the questions raised by the task force on resource 

 acquisition. There are a number of other important issues facing Bonneville and the 

 region. Many of the assumptions that underhe the Northwest Power Act have changed. 

 For example, the Congress assumed that Bonneville would develop most, if not all, of 

 the new resources for the region. In fact, most of the investor-owned owned utilities, 

 and some of the public utilities are developing their own resources. This has been a 

 challenge for our efforts to realize the coordinated development of resources envisioned 

 in the Act. 



The Act gave Bonneville new authority to pool the risk of regional resource 

 development. Today, many utilities see significant risks to Bonneville from potential 

 repayment reform, and lack of access to borrowing authority. 



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