The Bonneville Power Administration and utilities in the Northwest have been vested with the responsibility for acquiring conservation since passage of the Northwest Power Act in 1980. The Power Act established conservation as a resource equivalent to adding new generation except that conservation is generally less expensive over the long term than new generating resources. Unfortunately, there appears to be growing perception that increased competition will bankrupt any utility that increases its rates to pay for increases in the efficiency of electricity use (or for that matter anything else). This has reinforced the views of some who believe that “paying consumers to use less electricity” may once have been a great notion, but is now, in most cases nonsense.
The Northwest Power Planning Council understands that the utility industry is rapidly becoming more competitive. This paper opens with a description of the principal problems facing utilities when they consider future investments in energy efficiency. It then sets forth possible approaches to sustaining the conservation investments of utilities in the face of increased competition. Taken as a whole, these suggestions represent a reasonable starting point for actions that could secure conservation while maintaining utility competitiveness. The Council maintains that Bonneville and the region’s utilities can remain competitive if they seriously pursue the conservation approaches discussed in this paper. The Council is particularly interested in comments on this paper that analyze the potential impact adopting these strategies might have on individual utilities. In addition, the Council is soliciting suggestions for other mechanisms that would make conservation more competitive.
