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Northwest Utilities, Power Suppliers Urge Conservation to Keep Down Rates

Noting that this winter will end up being the second worst season in the Pacific Northwest in a series of six straight with below-normal water levels, a group of public- and private-sector energy providers in Portland, OR, Thursday collectively urged retail power customers throughout the region to conserve electricity and shift their use to nonpeak demand times this spring and summer.

Bonneville Power Administration's (BPA's) top official called this winter "very bad" for rain and snow, leaving stream flows at 63%-of-normal level this summer.

BPA Administrator Steve Wright assured customers that this summer is "not the same situation we had in 2001." Reliability is not a problem, but rates are likely to be hard hit, he said, noting that the Pacific Northwest continues to be uniquely dependent on hydroelectric supplies for 60% of its electricity, compared with 15% hydroelectric use nationally.

However, added natural gas-fired generation, along with enhanced gas storage and transmission capacity, will provide protection against there being power shortages, like those experienced four years ago during a more dire drought.

Both PacifiCorp and Portland General Electric representatives said they do much more forward hedging in their natural gas volumes than they did four years ago, and as such, they are in reasonably good shape for thermal-produced power supplies this summer.

The continuing drought's primary impact will be "financial," BPA's Wright said. "Low precipitation is reducing hydro system performance for utilities and suppliers in the region, which increases power purchases from other, more costly sources. Low water in rivers is also shrinking expected surplus sales revenues, and all of this puts upward pressure on rates."

Along with the private-sector power providers, representatives from the Clark (County, WA) Public Utilities (PUD), Northwest Power and Conservation Council, Northwest Requirements Utilities, and Public Power Council, gathered at BPA's headquarters to kick-off the conservation push and reiterate the poor water conditions again in the region.

Wright and his colleagues from the other energy companies said that energy efficiency and conservation can make a contribution throughout the year -- not just in this upcoming summer period.

Following a 7.5% rate decrease last year, BPA has warned about possible rate increases due to weather this year, Wright said. "We can't do anything about the weather, but we can do something about how much energy we use."

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