79 



However. Bonneville continues to sell some peaking power to the investor- owned 

 utilities - power they need to get through periods of heavy use in the winter heating 

 season. Bonneville also sells ■non-firm" power to the investor-owned utiliUes and 

 utilities outside the region when electricity surplus to the needs of the preference 

 customers is available. 



In 1976. Bonneville's power demand and supply projections showed that 

 Federal power supplies were running short for preference customers, and that 

 Bonneville would no longer be able to guarantee preference customers that their load 

 growth could be met beyond 1983. Bonneville issued a notice of insufficiency to the 

 utilities in June of 1976. 



Rate Disparities 



With the investor- owned utilities relying on their own hydro and thermal 

 resources to meet the demand of their customers, and with the prices of federal 

 hydropower much lower than that of new thermal generation, a divisive struggle for 

 access to limited federal resources grew. Sixty percent of the residential and farm 

 customers of the region are served by investor-owned utiUties. These customers 

 were paying, on avereige. twice as much for electricity as customers of publicly owned 

 utilities receiving wholesale power from Bormeville. The City of Portland sued 

 Bonneville, claiming a right to a share of hydropower resources for its citizens. The 

 State of Oregon passed a law authorizing formation of a statewide public utility -- the 

 Domestic and Rural Power Authority -- to seek service as a preference customer from 

 Bonneville so that all residentiad customers of private utilities could receive the rate 

 benefits of Federal resources. Elected officials of other states talked of forming their 

 own statewide public utilities. 



Stimulated by rate disparities, the public power movement also experienced a 

 renaissance. A strong pubUc power move to buy out investor-owned utihty service 

 areas by means of elections in accordance with State law was revived in Oregon. All 

 votes to form new PUDs failed in the November 1980 elections, but one long inactive 

 PUD. the Columbia Peoples Utility District west of Portland won voter approval for 

 issuing bonds to buy out utility properties in Columbia County. 



Meanwhile, planning for more resources to meet demand was hamstrung by 

 uncertainty over the allocation of low-cost federal power among competing claimants, 

 existing emd new. For example. Bonneville's contracts with its direct service 

 industries, which are large industrial firms that purchase power directly from 

 Bonneville, were to expire in the 1980s. The power sold to these industries would 

 have to be sold to public utiliUes tmder the preference clause. If they were to survive 

 in the Northwest, these industries needed an zissiu-ed source of electricity. 



