BPA DEFICIT INDICATES PRACTICES MUST CHANGE

August 22, 2002 12:00 am

If you had a crystal ball and could tell people how much energy is going to be needed each and every year, you could be an extremely wealthy individual.

Just last year, energy was the discussion across the West. From blackouts in California to portable generators being set up by utility cooperatives, you couldn't find enough energy unless you were willing to pay astronomical prices. The energy crisis of 2001 cost consumers billions more in energy prices, whether it was for electricity or natural gas. Most Oregonians saw whopping, double-digit increases in their bills and the forecast was even gloomier.

THE MAJOR power suppliers like Bonneville Power Administration were warning people living in the Northwest to conserve, conserve, conserve. Power companies such as Portland General Electric offered customers a reduced price if they would wash and dry their clothing at odd hours. For the first time in over a decade, utilities were offering to provide consumers with free weatherization evaluations. Everywhere you turned, it seemed like the 1980s again, with lots of tips on how to conserve energy.

ONE YEAR LATER, that energy crisis has dissipated and we have a crisis in the opposite direction. Too much energy is available, so the bottom has dropped out on the price of power. Almost weekly we are seeing headlines reporting another energy company asking the Public Utility Commission to roll back some of the price increases. We've done too good of a job of conserving energy. With BPA projecting a $1 billion deficit over the next five years, will all the proposals to create "green'' power be in jeopardy? Wind farms have been the talk of the Northwest and especially rural Eastern Oregon.

IT WOULD BE IRONIC if consumers got stuck paying higher energy rates because the need for Northwest power has diminished. The BPA's vice president, Paul Norman, has said there are several options to reduce costs: "One is raise rates, two is cut costs, three is we could borrow and push this problem out in the future, and four is we could take more risk in making our payment to the U.S. Treasury for the cost of the federal system."

IT IS SAD that BPA's leadership has been so inept over the past decade when it comes to looking at the history of the organization when making plans for the future. BPA's initial mission was to serve rural utility districts and co-ops and to provide low-cost power to Northwest aluminum plants. Instead, the organization has gone in the direction of selling power to large private utilities and utilities in states outside the Northwest.This destructive path must be stopped and only Congress can do that. Oregon Sens. Ron Wyden and Gordon Smith should lead the way in changing BPA's practices and bringing stability to the region's energy needs. If they don't, we will continue to face the roller-coaster ride of skyrocketing energy prices one year and then devastating losses the next.