124 



do you see this as something that could be effective with other util- 

 ities? 



Ms. Ervin. There are two approaches or ways of looking at that. 

 Certainly, there can be a lot of transferability and I would hope 

 that would be the case. I think all parties involved in that would 

 realize and acknowledge that it's been kind of a long, slow, painful 

 process. So we should have learned a lot from that and we should 

 be able to apply it to others. 



On the other hand, I wouldn't want to say unilaterally that we 

 should now use that standard approach that was carved out over 

 that 3- or 4-year-long process and apply it to all others. It gets back 

 to my original theme of really taking more of an end-user cus- 

 tomer-oriented approach. 



Let's try to be flexible and creative and work with individual al- 

 ternative service providers and utilities to fashion programs that 

 work for them. I think that the Emerald type of program can be 

 successful elsewhere, but I wouldn't want to limit it exclusively to 

 that approach. 



Mr. DeFazio. Thank you. Now, finally, to BPA, Tenaska is 38 

 mills levelized and my understanding of your appHcation of what 

 you perceive as the mandate in the Act is plus 10 percent for con- 

 servation resources for a cost-effectiveness comparison. 



Are we now or have we obtained all the cost-effective conserva- 

 tion at less than 41.8 mills to date this year? Will we next year? 

 Will we the year after, since these, I assume, are levelized so we 

 can talk about it infinitely? Is that 660 megawatts the amount of 

 conservation? 



You're saying that of the conservation out there, 41.8 mills or 

 less, there's 660 megawatts of conservation renewables out there at 

 less than that price and that's it that you can acquire. 



Ms. HiCKEY. We have a commitment to purchase all the cost-ef- 

 fective conservation by 2003. So if you wanted me to sit here today 

 and tell you we'd purchased everything below 41 mills today, I 

 couldn't do that. 



The one thing that we want to assure is that as lost opportuni- 

 ties that are below that cost-effectiveness ceiling come up, we are 

 purchasing them, and we are actively moving constrained budget 

 funds into areas to assure that we're making those purchases. 



The 660 megawatts is our best estimate to date. In fact, on the 

 books, we have 680 megawatts that we're purchasing. So, it's some- 

 where in that range of what constitutes all cost-effective conserva- 

 tion. The measured cost, in fact, goes up to the high 50 mills. So, 

 the 42 mill number you're using is a program average cost and 

 we're including marginal measures that go up to 50-55 mills. 



Mr. DeFazio. So the answer is as of, say, this year, we are not 

 getting all the cost-effective conservation, but we have a 10-year 

 plan over which time period you are committed to acquiring all 

 cost-effective conservation with a slow startup. 



Ms. HiCKEY. And on a year-by-year basis, we are producing all 

 the cost-effective lost opportunities. 



Mr. DeFazio. And lost opportunities being the key word. 



Ms. HiCKEY. Yes. 



Mr. Hardy. Yes. 



