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by creating their own power resource future. BPA is not 

 necessarily in the center of this future. To their credit, BPA 

 has recognized these competitive pressures and is actively taking 

 steps to address these concerns. Obviously, one area to examine 

 is BPA's role in resource acquisition in an era considerable 

 different from the era leading to the creation of the 1980 

 Regional Power Act. 



STRENGTHS AND WEAKNESSES - BPA RESOOKCE ACQUISITION 



In many ways, the strength of BPA's past resource 

 acquisition processes have evolved into weaknesses. Through 

 time, BPA has created a plethora of resource acquisition 

 activities. These activities have covered the full range of 

 resource types (conservation, renewables, thermal) as well as 

 processes (direct acquisition, backing of bonds, billing credits, 

 etc.). This has come at a cost, both financially and 

 organizationally. Some of this cost can be correctly attributed 

 to testing various methods to acquire resources. While this may 

 have been appropriate during the period of surplus in the 1980s, 

 it is no longer true in the resource deficit 1990s. 



For BPA to remain a viable resource provider, it must focus 

 on those resources that best balance near term and long term 

 costs. Over the past decade, BPA has followed the lead of the 

 Regional Power Act and the Power Planning Council by investing 

 more funds in conservation than any other new resource. But 

 future spending within the conservation sector must be 

 reexamined. The bulk of conservation funding has occurred in the 

 residential sector. Much of it has been at much higher cost than 

 conservation that is available in the commercial and industrial 

 sector. 



The true test of BPA's and the Council's commitment to 

 treating conservation as a resource is whether conservation 

 acquisition funds will be directed to those programs (regardless 

 of sector) that provide the greatest return for the funds spent. 

 For example, it appears BPA has created a belief by some that 

 residential weatherization is an entitlement, even if it is 

 considerably more expensive than other types of conservation. 

 This does not mean that residential weatherization will not be 

 funded, only that the timing of that funding may change. If BPA 

 can acquire conservation megawatts for considerable less through 

 other conservation programs, it should do so. Higher cost 

 programs, even if politically popular, can be funded when lower 

 cost resources have been exhausted. 



While the wide range of resource acquisition programs 

 (especially in the conservation sector) has allowed a great 

 amount of program experimentation, it has also created 

 considerable confusion. This leads to concerns regarding BPA as 



