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kinds of resources, perhaps there should be laws that are enacted 

 that state that. 



As far as I know, I don't think there are at this time. 



Mr. DeFazio. Well, whether it was wisdom or not. Congress left 

 a lot of latitude to regional authorities and/or air shed sorts of 

 areas to deal with those sorts of things. And whether they do it 

 through persuasion, penalties, prohibitions, whatever, has been 

 somewhat left up to regional or state authorities. But they have 

 identified a number of these pollutants as problems and, in particu- 

 lar, theyre problematic in certain air sheds than they are in oth- 

 ers. 



The earlier concern raised about if gas was interrupted, oil-fired 

 in cold weather circumstances for Tenaska, things like that, within 

 the Puget Sound area and the problems related to that. 



On the conservation issue, how is it that you — do you feel that 

 it has been over-estimated in its efficacy? We had an earlier discus- 

 sion here, I believe by Ms. Van Dyke, about the measurable — 

 where their concerns were they were going to continue measures 

 that had previously been authorized by BPA and BPA said, no, 

 they wanted to develop a new way to measure the efficacy of those 

 measures. 



Do you think that your concerns — are your concerns about con- 

 servation that they have over-reported through some under-sam- 

 pling or overestimation of effects, the conservation required? What 

 is it that you use to say that the installed cost or the avoided gen- 

 eration cost is much higher than what they're reporting? 



Mr. WiLKERSON. My comments did not relate to the measure- 

 ment of the actual conservation acquired. It has to do with the defi- 

 nition of conservation as a resource. I was with Bonneville and 

 probably gave one of the first talks by a Bonneville official where 

 we proclaimed conservation as a resource under Don Hodel as Ad- 

 ministrator. 



We all have believed that you just tell it the cost of getting peo- 

 ple to give up their use of energy and that that would be consid- 

 ered the cost of the resource. Mr. Chairman, included with my 

 written testimony, I've attached some stuff which I no longer be- 

 lieve that. 



Traditional utility planning has a utility serving the new load, 

 the load growth, the increasing load of the system, with a resource 

 at the lowest possible cost. That's the way resources have always 

 been planned. With conservation, we're not doing that. 



If you serve new load with generation, you are not, in making 

 your — and you have several types of generation, all of those, you 

 compare one to another, and there's no cost of that comparison 

 that's been allocated back to the existing consumers. You're looking 

 at new load and new generation resources. 



With conservation, what we are doing, we are paying to get the 

 existing users to give up the use of the energy and then we're com- 

 paring that with the cost of serving the new load, but the unused 

 costs — well, I guess it's not unused, it's the creating of the elec- 

 tricity that has to be re-diverted over to serve the new load, to go 

 with giving up the load. That is not charged. 



So we're reallocating the costs of the generation back to the 

 existing 



