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News Analysis

Fortnightly Magazine - November 1 1999

MW of BPA power among six IOUs. Members of the Idaho, Montana, Oregon and Washington commissions OK'd a plan giving Puget Energy the largest allocation - 700 MW of electricity. BPA already had allocated power among public power companies and reached agreement with most of its DSI customers. Once the BPA rates are set, it formally will offer contracts to the individual customers reflecting terms and prices for energy.

Power Politics:

Discriminate Against Problem Firms?

Politicization of the power allocation process extends to judging the worthiness of BPA's potential customers, as evidenced by a Sept. 9 meeting at BPA headquarters in Portland, Ore., attended by U.S. Energy Secretary Bill Richardson. At that meeting, United Steelworkers Association District No. 11 director David Foster advocated that BPA adopt a "corporate good citizenship clause" requiring BPA's industrial customers to demonstrate a good record of environmental, labor and safety standards in order to qualify for continued access to low-cost power.

Foster lamented that steelworkers from Kaiser Aluminum's plants in Tacoma and Spokane had been locked out since Jan. 14 in a labor dispute. According to Foster, Energy Secretary Richardson showed a "clear openness to holding BPA's corporate customers accountable for their conduct as it affects their workers, their communities and the environment."

Foster believes Kaiser should get no low-cost power. "We are confident that Kaiser Aluminum's conduct will disqualify them from receiving the preferred power rates that Bonneville has proposed offering to the rest of the aluminum industry," he said.

Meanwhile, on Sept. 15, Vanalco left open the possibility of future legal action against BPA, by petitioning a federal court to review its proposal for the allocation of electricity.

Not The Last Word: New BPA Oversight?

Energy politics means money, and so on Sept. 17, Oregon Gov. John Kitzhaber called on the governors of Idaho, Montana and Washington to join him in a regional front as well as in creation of a new entity to oversee BPA. The focus of the new entity would be to help restore fish while preventing the U.S. Congress from ending the provision of low-cost power by BPA through privatization. The fish restoration planning now lies with the Northwest Power Planning Council (see sidebar, "We'll Go Quietly, Says NPPC").

"I have been working closely with Gov. Racicot of Montana to develop a set of principles to guide the creation of such a structure," explained Kitzhaber. "The proposal envisions a regional entity that includes appropriate representation of the state and tribal governments of the Columbia Basin, for the federal government and for Canada."

Kitzhaber even hopes the new entity will buy BPA from the federal government. He admitted that a main goal is to preserve the cheap, regional source of electricity.

"We ignore this problem at our own peril," warned Kitzhaber. "Pricing federal power at market would amount to at least a half-billion-dollar annual loss to our region." Kitzhaber hopes to meet with the three other governors as soon as possible, and have a proposal to present to Congress by year-end.

Lori A. Burkhart is a contributing legal editor at Public Utilities