101 



l,ct me elaborate Clark Public Utilities, which purchases about 400 

 average megawatts from Bonneville, concluded a Request For Proposal in the fall 

 of 1994 and is now building a 248-megawatt gas-fired combustion turbine with 

 Cogentrix, a major independent power producer from North Carolina. In addition, 

 Clark has secured purchases from PacifiCorp and Washington Water Power to 

 cover its needs between now and the time the new combustion turbine comes on- 

 line at prices comparable to Bonneville's current priority firm rate. The current 

 load loss estimate to Bonneville for Clark is about 200 average megawatts. 

 Snohomish County Public Utility District has decided to purchase 60 average 

 megawatts from Washington Water Power for at least one year And, Grays 

 Harbor Public Utility District has decided to retain its 30 megawatts of output 

 from the Centralia coal plant rather than buy power from Bonneville 



To round out the 500 average megawatts of lost or nearly lost sales, 

 customers representing another 175 average megawatts of current sales have 

 requested and received approval to leave Bonneville in the near fijture This 

 includes a recent decision by Canby Utility Board to take its business, 13 average 

 megawatts, to Portland General Electric and a recent decision by Eugene Water 

 and Electric Board to take 100 average megawatts off the Bonneville system and 

 buy from four other suppliers 



Future declines and increases in sales are also possible, depending on the 

 prices and products that Bonneville and its competitors offer. For example, two 

 large Requests For Proposals issued on behalf of about 40 Bonneville customers, 

 are currently in process and could lead to a loss in sales of up to 1,200 average 

 megawatts to competitors The direct-service industrial customers also could take 

 their business to competitors, since they were granted 250 average megawatts in 

 waivers to their current notice provisions as part of the agreement for extension of 

 current rates with a 4 percent surcharge Northwest Aluminum Company in late 

 /\pril announced that it would purchase 70 megawatts less from Bonneville in 

 favor of a 5-year contract with Washington Water Power at an average rate of 20 

 mills for the entire contract period 



Market prices for spot and block purchases of power have been under 16 

 mills since January - indicating the low price of gas as well as the surplus of 

 generating capacity on the West Coast Utilities with excess generating capacity 

 are able to buy spot gas at very attractive prices and then sell the energy at a slight 

 mark-up, resulting in very low prices Euro Brokers, Incorporated, a new power 

 broker on the West Coast, recently offered a block of power, on behalf of one of 

 its clients, for all 1 2 months of 1 996 at a price of only 2 1 mills Alcoa Aluminum 

 signed a I -year contract with Enron for 50 megawatts at 19 mills. 



Independent power producers are also quite active in the Pacific Northwest 

 and have significant potential to compete successfully with Bonneville One large 

 facility already has its siting permits and could construct up to 395 megawatts 



