498 



Concurrent Resource Acquisition 



The Council's priorities for resource acquisition are descriptive, not prescriptive. 

 Under the Regional Act, conservation and renewables are grsmted a preference in resource 

 acquisition. While we support this prioritization, it must be recognized that this system -- 

 or any other "externalities" mechanism - does not prestime that one resource type will be 

 pursued to the exclusion of all others. TTiose that would suggest that the region must 

 exhaust all available conservation before considering other resources do not sufficiently 

 understand the Act's intent, the concept of least-cost planning, or utility resource planning. 



First, it is important to remember that the priorities in the Act are intended to 

 provide a system for screening resources during the development of a least-cost plan. The 

 Act's priorities Jire designed to acknowledge the comparative economics of conservation 

 and renewables. Ultimately, however, BPA is to select the resources that are least-cost. If, 

 after "tweaking" the economics under the Act's priorities, the costs of certain conservation 

 resources are not clear or are not "least cost," then the Act directs BPA to acquire 

 alternative resources. 



Second, prudent utility planning argues against acquiring conservation or any 

 resource to the exclusion of all others. The WPPSS experience demonstrates all too well 

 the potential risk of placing too much emphasis on one resource type. New York State 

 Commissioner Peter Bradford, a strong conservation proponent, has warned against turning 

 conservation into the "nuclear" resource of the 90's. 



In addition, factors other than price enter into utility resource acquisition decisions. 

 For instance, a utility may be willing to pay more for resources that are dispatchable — a 

 characteristic not attributable to conservation. 



The Council has established an appropriately aggressive target for conservation 

 acquisition. BPA and the region are on schedule to meet that target. Also, the Council's 

 review of BPA's conservation costs suggests that BPA can eliminate conservation program 

 overheads without reducing the amount of conservation acquired. 



As we eliminate overhead and reduce the cost of acquiring conservation, it is 

 possible that more conservation can be cost-effectively acquired. This is precisely the 

 system of resource review and selection the Act intends ~ not the blind pursuit of a single 

 resource option. 



