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turbine. Bonneville needs to offer short-tenn, simplified "standard offer' acquisition 

 contracts for small (less than 30 aNfW) resource acquisitions. 



4. Is BPA an efrective indirect purchaser of regional resources through third party 

 Hnancing, billing credits, conservation power plants, and other indirect means? 



Third Party Financing 



Bonneville has been effective in acquiring conservation in the past, but recent changes 

 in Bonneville's concern over risk assignment and budget limitations has reduced its 

 effectiveness. Current contract offerings by Bonneville are detailed and complex in their 

 attempt to identify, quantify and assign risks. In addition, the cost of financing the needed 

 levels of conservation has raised concern about Bonneville's borrowing limits. In 198S 

 Bonneville and EWEB participated in a conservation bond program in which EWEB sold 

 municipal bonds to fund the conservation acquisitions ia Eugene. Boimeville paid the cost of 

 the bonding. This program produced a level of conservation activity in Eugene that has not 

 been matched by any of the numerous conservation mechanisms offered by Boimeville since 

 then. Of EWEB's attempts to solicit a conservation billing credit, targeted acquisition 

 contract, competitive bid for conservation contract, or an extension of the curreiu EWEB 

 bond contract, none have yet been accepted. 



A renewal of the 1983 third party financing project between Boimeville and EWEB 

 could work to overcome the current budgeting and complexity problems that plague 

 Bonneville's current conservation programs. Conservation should be treated as a resource, 

 particularly when the risks are shared and the utilities assume program management. A 



