Potential for Expanding Electric Power Transmission Between the Pacific Northwest and California

Testimony was given on the potential for expanding electric power transmission between the Pacific Northwest and California. Although in 1980 the Northwest was projecting power deficits, the recently issued Northwest Conservation and Electric Power Plan forecasts power surpluses, and the Bonneville Power Administration (BPA) has initiated actions with California and other Northwest utilities for short- and long-term contracts. Although intertie expansion options appear economically feasible, they have been hampered by financial risks. Investors are concerned about uncertainties of power supply and delivery related to potential interties with public and private utilities. GAO suggested that BPA work with Northwest utilities to determine: (1) how much Northwest surplus energy is available for marketing to California; (2) how long the surplus will be available; and (3) how the energy will be priced. GAO believes that BPA should consult with Canadian provincial Governments concerning the export of energy and determine whether legislative restrictions can be addressed in the negotiation process. If not, the BPA Administrator should initiate legislative changes that would be appropriate to facilitate successful negotiations. GAO concluded that, if no intertie expansion agreements have been reached within a year, the Secretary of Energy may want to seek congressional approval for the two Federal power marketing agencies in these regions to develop the most cost-effective intertie solutions.