Panel Offers Bpa A Plan For Survival Task Force Recommendations Could Save Millions Annually

The Bonneville Power Administration could trim as much as $159 million a year from its $2 billion budget if managers adopt eight recommendations released Tuesday by a Cost Review Committee.

Of the eight, the two likely to be the most controversial are a suggestion that the region’s lone nuclear power plant fend for itself in a bruising electricity market, and deep cuts or elimination in some cases in spending for conservation and renewable energy resources.

Separating Washington Public Power Supply System Plant No. 2 from the agency’s cheap hydropower will help managers determine how much nuclear power increases the overall cost of energy Bonneville sells to utilities up and down the West Coast, said Mike Kreidler, Washington state’s representative on the review committee.

And cutting renewable energy and conservation expenditures down to projects Bonneville has already committed to will improve its competitiveness, he said.

“What we have guaranteed is that Bonneville is going to survive,” said Kreidler, who sits on the Northwest Power Planing Council.

The federal power-marketing agency, once the supplier of some of the least expensive electricity in the country, has struggled to compete in recent years as debt exploded and fish and wildlife costs mushroomed.

Other utilities have picked off customers. The review panel was convened last summer to consider how to restore Bonneville’s edge. Some recommendations will require congressional action.

The panel estimates splitting off WNP2 would save $19 million a year after 2001, when its recommendations would take effect.

Conservation and renewables would be cut by $22.4 million a year, down from $47.6 million. As recently as 1994, Bonneville spent more than $200 million on those resources.

The panel also suggests Bonneville could save $48 million by streamlining operations at the U.S. Army Corps of Engineers and Bureau of Reclamation, which run the hydroprojects that produce about 80 percent of the 8,600 megawatts the agency markets.

Nuclear power constitutes about 10 percent, all from WNP2.

If power from WNP2 cannot find a buyer, Watson said the plant will probably have to be terminated, with Bonneville picking up the tab - several hundred million dollars.

The panel’s other recommendations include:

A smaller marketing staff because cheaper power will be easier to sell.

Lowering overhead, trimming a potential $22 million.

Refinancing debt, saving $20 million.

Bringing the method of calculating transmission costs into line with private sector practices, saving another $32 million.

Funding for the council would be reduced 28 percent from current levels. Membership, said Dick Watson, committee member and council director of power planning, might have to be trimmed to one member per state from two.

Carl Von Hoff, regional planning manager for WPPSS, said the agency does not take issue with the review committee’s findings.

“We find the committee’s recommendations for selling our power in the market an interesting one,” he said.

The cuts in conservation and renewable resource spending were not so well-received by the NW Energy Coalition.

Spokeswoman Michelle Ackerman said Bonneville has a duty to continue spending on renewable resources, even if the region no longer needs additional power.

Noting cuts already made in those programs, she said “Basically, they’re gutting what remains.”

The review committee did not study Bonneville’s expenditures for fish and wildlife, which total about $465 million a year.

A hearing on the committee’s plan is scheduled Feb. 11 at Cavanaughs Ridpath Hotel in Spokane.

, DataTimes