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Mr. DeFazio. Thank you. Finally, Mr. Esteves. 



STATEMENT OF RICHARD ESTEVES 



Mr. Esteves. My name is Richard Esteves, vice president of 

 SESCO, Inc., whicn is a minority-owned energy service company 

 specializing in the treatment of residential and low income house- 

 holds. 



We provide conservation services free of charge to the individual 

 residents and participants, making our revenue strictly off of sell- 

 ing back to the utility company the conserved measured kilowatt 

 hours that are saved there over a period of time. 



That's a key concept because it matches the history that we've 

 seen on the independent power producer side in which QFs and 

 independent power producers are able to sell back to the utility 

 company metered produced kilowatt hours over a period of time. 

 We're trying to bring the same type of accountability to the con- 

 servation field, along with companies such as Proven Alternatives, 

 KENETECH and others. 



The key is that we are paid based on the output of what we de- 

 liver to the utility system. No savings, no payment. On the other 

 hand, if we do a particularly good job, a comprehensive job, we're 

 paid in proportion to the benefits that we're able to deliver. 



Since the utility is able to price the service at a price per kilo- 

 watt hour that is less than its avoided cost, it's guaranteed to al- 

 ways be cost-effective for that utility company, regardless of the 

 level of activity that is actually reached. As I said, we are probably 

 the largest energy service company dealing with the residential 

 area. We currently have 56,000 houses completed or under con- 

 tract. 



Perhaps even more important, we have over 60,000 measurement 

 years of actually measuring the results at the various houses. To 

 put this into perspective, ^ of the studies combined that Bonne- 

 vQle has done on its residential program is less than 10,000 meas- 

 urement years. 



Our company, along with perhaps Seattle City Light, has the 

 largest database of such records in the country. We normally sign 

 contracts for the length of term that the utility is interested in. 

 Our contracts have gone from as Uttle as four years to as long as 

 25 years. We've offered contracts to Bonneville Power for a maxi- 

 mum of 20 years. 



Adjustments are made usually for weather conditions or for local 

 economic factors or for control groups or whatever the factors the 

 utility wants to put into the measurement plan. We treat all across 

 the board. We treat single-family homes, multi-family homes, mo- 

 bile homes, renters, high income, low income. 



Since we charge the customer nothing for the service, there is no 

 restrictions on who may participate or practically who can partici- 

 pate. We're simply going after those homes which are most in need 

 of the conservation benefits. 



Currently in the Northwest, have a contract with Portland Gen- 

 eral Electric to do approximately 5,000 low income homes in the 

 Salem, Oregon area. It's under a special tiered rate system in 

 which we're paid significantly less for the first 1,200 kilowatt hours 

 and significantly more for an5rthing above that. The 1,200 kilowatt 



