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conservation resources than the Act envisioned to meet the cost-efTectiveness test. 



The utilities I represent firmly support considering conservation as a resource, but 

 conservation must be treated equitably along with generation. 



Council Role and Relationship to BPA . The Council has gone far beyond its authority 

 under the Act in the resource acquisition field and has encroached substantially on the 

 BPA Administrator's responsibility and authority under the Act. The Council should 

 focus on planning and should recognize BPA is responsible for implementation. It is 

 not the Council's responsibility to implement - - it is expected to "encourage," 

 "review," and "monitor" implementation in order to improve on the Plan and Program 

 it develops. A review of the Council's current budget will disclose it is spending a 

 substantial majority of its budget (paid by ratepayers) to involve itself in implementing 

 activities. 



The Council has indicated it sees its role as "overseeing" the activities of the 

 Administrator and as providing "oversight" of the Administrator. Perhaps I am overly 

 sensitive to semantics, but those words never appear in the Act. "Encourage, review 

 and monitor" are the words actually used. The Council should assist the Administrator 

 to implement the Plan and Program only when requested by the Administrator. 



The Interior Committee Report during its consideration of the Act stated, "Once the 

 Plan is adopted, the Council's expenditures should not be as great as they may be prior 

 to planning." The Committee's expectations have never been met. The expenditures 

 of the Council have not dropped, instead they have increased largely because of the 

 Council's "assumed roles" relative to implementation. Not only is this costly, it is 

 duplicative and time consuming. It forces electric rates to rise. 



Neplect of Basic Objective. As mentioned earlier, it appears the Council and BPA 

 have lost sight of the basic objective of the Regional Power Act stated in Section 

 2.(2), 'to assure the Pacific Northwest of an adequate, efficient, economical, and 

 reliable power supply." 



Conflict in Act Related to Rate Impacts and Cost Effectiveness. It is now generally 

 agreed the rate impact of conservation costing a certain amount is much greater than 

 the rate impact of generation costing the same amount per kilowatthour. The actual 

 rate impact of the BPA conservation program has been much greater than had the 

 same amount of generation been acquired. 



The Council has not explicitly informed the public of the rate impact of pursuing 

 conservation versus pursuing conventional generation under the cost-effectiveness test 

 in current use. We would encourage them to do so under their full disclosure policy. 



In my judgment, there is an unintentional conflict built into the Regional Power Act. 

 The Act gives great emphasis to the rate impact of resource acquisition under Section 

 6(h)(3) and does not distinguish between conservation resources and conventional 



