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These utility barriers include the following; lack of an adequate 

 resource development funding mechanism. All utilities can't issue 

 bonds to fund conservation and renewables by themselves, the issu- 

 ance costs and so forth. They need to come together to be able to 

 do that. 



UtiHty staffing and technical resource hmitations. Four of the 

 CARES members only have one conservation staff member in the 

 utility. For them to be able to even work with Bonneville on a con- 

 servation program is extremely difficult. 



Size of project risks, even a small project, conservation project, 

 let alone a renewable or a cogeneration plant, something like that, 

 do something that may be well beyond the resource risks and the 

 political, local political risks for that utiUty. 



There's also the lost revenue issue. Now, this is something that 

 CARES can't address, as such, but is a concern for those utiUties, 

 because many of the small and rural PUDs and even larger PUDs 

 are located in timber enacted and other slow growth areas and face 

 a real problem in addressing that issue, aggressive pursuing con- 

 servation and, at the same time, losing revenues. 



And there is the problem of the relatively large — relative advan- 

 tage of larger utilities who have large staffs with lots of expertise 

 and know how to design programs, know how to work effectively 

 with Bonneville in terms of resource acquisition. 



Further, there's limited infrastructure. Out there in these utility 

 service areas, you may not have the contractors available and other 

 skilled equipment suppUers and so on that are needed to produce 

 these resources. 



As a consequence, there is a non-participation in resource acqui- 

 sition by small and medium-sized utihties and the result for the re- 

 gion is there are fewer low cost conservation and generation re- 

 sources will be captured. Energy resource development programs 

 will neglect areas of the state and region that especially need eco- 

 nomic development. 



At the same time, a number of studies have shown that — for in- 

 stance, the University of Oregon EWEB study and a B.C. Hydro 

 study — that utilities have demonstrated that when utiUties develop 

 conservation in their own service areas instead of developing re- 

 mote central station generation plants, their communities derive 

 economic benefits while avoiding environmental and siting prob- 

 lems. 



Also, there's the cost of the loss of support for Bonneville in its 

 conservation programs by these utilities when they're unable to 

 take advantage of those programs. 



The benefits of participation, and CARES is pretty much the in- 

 verse of these, local utility participation, for one, can — local utilities 

 have an existing contractual relationship with end-use customers 

 and have valuable load information about customers and the utiUty 

 has a permanence in the local community that allows ongoing over- 

 sight of projects. 



Other benefits include development of new demand side and sup- 

 ply side resources, fostering of economic development, retention of 

 renewable generating resources for the Bonneville system, lots of 

 wind sites. Virtually all of the wind sites in Washington State, for 

 example, are located in PUD service areas. To the extent they're 



