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customers' finandal decision criteria. This allows for more creative and comprehensive 

 programs with longer-term savings assurances We have also seen that, in other regions 

 where capacity constraints are a big problem, utilities have adopted more flexible DSM 

 program offerings 



In a 'low-rate" environment Hke the Northwest, we take considerable risk for very small 

 profit margins. As a result, we don't see the kind of conservation acquisition activity 

 going on here like we do in Califbmia or on the East Coast Consequent^, conservation 

 acquisition has developed less rapidly in our region 



2(b): In a period of bud^ constraints, energy service companies hke Proven 

 Alternatives can play a very important role in providing efficiency savings to BPA and 

 its customers. One of the features that makes our company unique to the industry is our 

 ability to provide third-party financing We are the only independent energy efficiency 

 company that offers non-recourse project financing as an investment tool By investing 

 in our customer's energy efficiency projects, we effectively isolate the customer's financial 

 risk from their capital risk and avoid delays in dealing with third-party financiers. In this 

 way we can make a significant contribution to Bonneville's ability to leverage limited 

 conservation dollars 



Another area where we can play a partnership role with Bonneville and its customers is 

 inprogram design. With a fuH complement of sales, engineering and operations 

 professionals to support project development and execution, quality control and 

 communications, we are able to provide Bonneville and its customers with the staffing 

 and e>pertise required to make these programs succeed Each office draws upon its own 

 expert staff, and on specialized technical financial and management expertise from 

 anywhere in the company to ensure successful implementation ofenergy-effkiency 

 projects. 



There is a need to move beyond the acknov^^ledgement of common goals, and move doser 

 to a collaborative approach to meeting those goals Building long-term relationships and 

 developing effective communications between the partners is the approach wefeelmustbe 

 embraced In order to sustain these partnerships, aH parties - utilities, customers, and 

 developers - must have a stake in the performance of the conservation resource. This is 

 what Proven Alternatives strives to do with its third-party project financing capabilities 



Q. 3 (a) In practice, are there significant differences in the processes used by 

 BPA to acquire conservation, renewable and fossil resources? 



(b) Are procedures, requirements, and administrative demands 

 essentially equivalent for equivalent resources? 



(c) Are resource acquisition costs and benefits appropriately shared? 



A 3(a) &(b) In order to respond to a resource acquisition request from BormevUle, a 

 typical ener^/ efficiency company like Proven Altematives wouldhave the same 



