June 04, 2007

Wyden Asks BPA to Delay Long-Term Contract Decision Until Residential Exchange Deal is Reached

Washington, D.C. - As thousands of Oregonians brace for significantly higher utility bills this month, U.S. Senator Ron Wyden (D-OR) sent a letter to the Bonneville Power Administration (BPA) today urging BPA to assume the role of an "honest broker" and to look for legally sufficient ways to restore the Residential Exchange benefits as soon as possible.

Since 1980, the Residential Exchange program has enabled residents and small farm utility customers in Oregon to share the benefits of BPA's low-cost, hydroelectric power. A recent U.S. Ninth Circuit Court of Appeal's decision disrupting the Exchange program, however, is leaving most Oregon customers without any Exchange benefits. In light of BPA's plan to move forward with its long-term allocation of system benefits (known as the Regional Dialogue), Wyden is urging BPA to put this release on hold, until the Residential Exchange issue is resolved.

The full text of Senator Wyden's letter is below:

June 4, 2007

Stephen J. Wright
Bonneville Power Administration
905 NE 11th Avenue
Portland, OR 97232

Dear Steve,

Just a few days ago on May 24th, I joined with my colleagues from the Idaho, Washington, and Oregon congressional delegations in calling for a regional response and solution to the disruption of the Residential Exchange program due to the recent decision by the U.S. Ninth Circuit Court of Appeals. As a result of this decision and Bonneville's subsequent suspension of Exchange payments, thousands of residential and small farm customers of investor-owned utilities in Oregon will begin paying significantly higher rates beginning today. I was therefore shocked to learn that the Bonneville Power Administration apparently intends to proceed with the release of the Record of Decision (ROD) and Policy concluding the outcome of the Regional Dialogue process as early as this week. I believe this is a mistake.

Without attempting to speak for everyone who signed these letters, I for one meant what we said when we wrote that "…everyone in the region has an interest in reaching a legally sustainable compromise that fulfills the public policy goals of the NWPA and allows BPA to enter into new power supply contracts with public agencies before the current contracts expire. This requires that all stakeholders - public and private utilities, BPA and consumers, states and public utility commissions -- join together in a good faith effort to negotiate a mutually agreeable and legally sustainable compromise." It is not only a mistake to proceed to resolve all other long-term issues in the absence of a clear policy on the issue of the Exchange, the decision to do so sends an unfortunate signal to all parties that resolution of this issue will be delayed and protracted and raises questions about BPA's ability to be an "honest broker" in resolving this crisis.

I recognize that the Regional Dialogue process has been underway for sometime and its further delay will impact the ability of utilities in the region to complete their long-term planning efforts, but it is even more imperative that all parties impacted by this process have a say, and a stake, in its outcome. We have just seen, in the outcome of the Ninth Circuit decision, the negative impact of what happens when any group is excluded from the process or when the process doesn't, in fact, address their interests. In the interest of bringing all parties to the table to resolve this issue, I urge you to delay moving ahead with the Regional Dialogue. I also urge you, in the strongest possible terms, to proceed as quickly as possible to bring these parties to together to negotiate a long-term solution.

Finally, I understand that the Ninth Circuit decision raises a number of questions about the procedures BPA followed in determining the level of Residential Exchange benefits. Nonetheless, residential and small farm customers throughout the region are faced with completely unanticipated increases in their electricity bills, increases some customers will have a hard time paying. It is imperative that BPA look for legally sufficient ways to restore some level of Exchange benefits as soon as possible while the longer term issues are being resolved.


Ron Wyden
United States Senator