109 



Mr. Smith of Oregon. Yes. I want you to separate them for me. 



Ms. HiCKEY. It's a very hard thing to do. 



Mr. Smith of Oregon. Well, we know hydro is cheaper, but you 

 must know how much hydro costs you. 



Ms. HiCKEY. Actually, it's not. 



Mr. Smith of Oregon. Okay. Then tell me what it is. 



Ms. HiCKEY. There are some hydro projects at 30 mills and then 

 the rest are in the low 40s. The cogen projects are generally around 

 the mid-30s. The geothermal projects also vary. There's some 40 up 

 to the high 40s. The combustion turbine project is at 38 mile. 



Mr. Smith of Oregon. So historically, hydro has, at least new 

 purchases, I assume, have increased dramatically. Hydro was much 

 lower than any other form in the past. That has changed, you're 

 telling me. 



Ms. HiCKEY. That's right. 



Mr. Smith of Oregon. I notice that you all agree, it seems, this 

 panel at least, that we need cost-effective results. We don't want 

 to just throw money at the process. Do you prioritize your pur- 

 chases with respect to that statement between the selected prior- 

 ities of hydro and cogeneration and wind? You're not telling me 

 wind biomass is in the 40s, are you? 



Ms. HiCKEY. No. There are biomass projects 



Mr. Smith of Oregon. That's got to be kind of ofF the edge of pri- 

 orities cost-wise, doesn't it? 



Ms. HiCKEY. Actually, I answered your former question a bit 

 quickly when you said it now looks like hydro is more expensive 

 than other resources. If you look at the projects we're buying, over 

 half of them are small hydro projects. So that means the5^re still 

 very competitive projects. The/re not the absolute least-cost 

 projects we're buying, but they're still very competitive. 



In all of the solicitations that we've run, there have been wind 

 projects that are surprisingly just out of the competitive range, 15 

 percent higher cost than the hydro projects. 



Mr. Smith of Oregon. I guess you're beginning to see my point. 

 If hydro is still the cheapest alternative and we all agree we need 

 to be cost-effective, why isn't the whole pie chart hydro purchases? 



Mr. Hardy. Because there simply isn't that much available. Con- 

 gressman. The cost-effective hydro means you develop most of the 

 sites that are capable of being developed and various environ- 

 mental constraints and just constraints. We've got all the cheap 

 stuff and what's left is not a large increment, but mostly of small 

 projects of hydro that's still there. 



The second point I'd make to try to get to your question is, you're 

 right. Wind and geothermal are somewhat more expensive than the 

 kind of competitive price ranges that Sue was talking about, al- 

 though not ^amatically so. 



We have a 50-megawatt wind solicitation and about 60 

 megawatts, I think, of geothermal in two projects. What we're ac- 

 quiring are research-and-development type projects. We've recog- 

 nized that those are more expensive, but we explicitly want to push 

 the envelope, in part to see if we can get the cost curve to come 

 down farther, especially on the wind projects where we've seen 

 some pretty encouraging developments in the last couple of years. 



