Over the past several years, the Bonneville Power Administration has faced periods of instability that have threatened its financial well being and that of its customers; hampered its ability to meet its obligations, including those to the U.S. Treasury; impeded the development of needed resources; and damaged the economy of the Northwest.
The conclusion reached in several processes in recent years is that these problems have their roots in the ways in which Bonneville has carried out its role and the uncertainties that creates with respect to resource development and load-serving obligations. This led to proposals for changes in Bonneville's role in power supply.
The financial crisis precipitated by the Western Electricity Crisis of 2000-2001 focused renewed attention on Bonneville's role. The region's governors have asked the Council to work with Bonneville and interests in the region to resolve this issue. The Council has consulted with a number of interests in the region and has convened a broadly representative steering committee to help address the key questions.
Bonneville has announced its intent to carry out a policy process this summer that would define the agency's future role as well as address a number of issues for the period remaining on its current power sales contracts. These recommendations are intended to provide input to Bonneville as it prepares its initial proposal for that policy process, as well as to the deliberations of Bonneville's customers and other interests as they consider Bonneville's long-term future role.
The focus of these recommendations is primarily on the long-term as opposed to resolving questions Bonneville has raised for the last five years under the current contracts. However, there is a high degree of overlap between the long-term issues and many of those raised under the existing contracts. There needs to be consistency between the resolution of these issues for the remainder of the current contracts and for future contracts. The Council believes the issues must be dealt with as a package rather than separately.
The Council's recommendations are summarized in the paper.
