251 



Fuel switching is a real potential for our region. It is an un- 

 tapped opportunity, I think, to obtain cost-effective load reductions 

 and defer new power plant construction. Fuel switching and using 

 direct gas heating is at least twice as efficient as producing elec- 

 tricity with gas. 



A pilot fuel switching program which was carried out by the Sno- 

 homish PUD demonstrated a substantial load reduction potential. 

 In spite of the savings and efficiency gains resulting from fuel 

 switching, Bonneville has not pursued this opportunity. However, 

 BPA's rate increase and their stated willingness to look at tiered 

 rates may result in future opportunities. 



BPA has made slow progress in carrying out the mandates of the 

 Act. The fact that Puget Power, a private utility with one-fourth of 

 BPA's load, acquired as much conservation as BPA did last year 

 suggests the agency needs to increase its efforts. 



In some areas, progress has been made. Implementation of en- 

 ergy codes is one of the bright spots and BPA has been a Uttle 

 eager on that and they continue to be right now. 



In conclusion, BPA's programs need improvement in the area of 

 adhering to the priorities of the Act, by encouraging conservation, 

 insisting that its utility customers accept an equitable share of the 

 responsibiUty for that conservation, and incorporating environ- 

 mental criteria into their resource acquisition program. 



Mr. Chairman, that concludes my testimony. 



[Prepared statement of Mr. Olsen follows:] 



