Northwest's cheap power comes under fire

"Roll on, Columbia, roll on," sang Woody Guthrie. "Your power is turning our darkness to dawn." And so it's been in the 60 years since the folksinger extolled the dams, those concrete monoliths that turned a rushing river into a string of reservoirs as their massive turbines hummed to produce hydropower.

The electricity has come steady and cheap over the years, powering aluminum plants, pumping water to irrigate crops, lighting up cities and towns across an area the size of central Europe.

But now those federally built dams and the Bonneville Power Administration (BPA), the government agency that markets their electricity, are under fire in a high-voltage political civil war that pits the Pacific Northwest against other parts of the country.

California's powerful congressional delegation - which outnumbers all Northwest states combined - demands to know whether the BPA, by shipping power south during the recent energy crisis, is making money in the Golden State's hour of need. In any case, say US Sens. Dianne Feinstein and Barbara Boxer and US Rep. George Miller (all California Democrats), BPA's favoring of Northwest customers is "archaic and unfair."

Lawmakers back in the Midwest and the Northeast claim BPA customers out West are benefiting from a taxpayer-provided subsidy their constituents do not enjoy.

Through their Washington-based research organization, the Northeast-Midwest Institute, they assert that Western officials are "trying to lure away the region's businesses and jobs with the promise of cheap electricity, which Northeast-Midwest taxpayers unwittingly subsidize."

"We need to understand who is benefiting from this federal agency selling 2-cent-per-kilowatt-hour electricity [that is federal property] for more than 20 cents in the tight California market," US Reps. Bob Franks (R) of New Jersey and Martin Meehan (D) of Massachusetts wrote to the General Accounting Office recently in calling for an investigation.

Mounting opposition

Pressure is mounting in Congress to force BPA to pay more for its power. Some even want to do away with the agency altogether, making the electricity its 29 dams produce available across the country. A bill in the last session of Congress would have dismantled BPA, turning its activities over to the US Army Corps of Engineers. One of the bill's sponsors was then-Sen. Spencer Abraham (R) of Michigan, now Energy secretary in the new Bush administration.

Western officials, meanwhile, are circling the wagons. They are trying to explain that BPA ratepayers, through the region's annual check to the federal treasury of about $730 million, in fact are paying back the capital costs of the dams and transmission facilities. Over the years, $4.4 billion in principal and interest has been paid back; $6.6 billion still is owed. They point to their own recent and anticipated wholesale rate hikes, expected to be 100 percent (or more) over the next five years, as evidence that the region is feeling the price crunch too. And they're crafting their own plans to take over BPA by buying it from Uncle Sam.

Created in 1937 during the Great Depression, the Bonneville Power Administration sells power to Northwest utilities and some large industries. Its first obligation is to public utilities, many of which are small, rural entities that rely totally on BPA for their electricity. Most of BPA's power comes from the dams and a single nuclear power plant. But to meet the needs of its customers, it also has to buy electricity from other sources. These days, that means through-the-roof prices.

Because the Columbia and its main tributary, the Snake River, are home to endangered salmon, BPA also must manage water flows to protect fish. The situation is further complicated by longstanding treaties with Indian tribes guaranteeing fishery resources to native Americans. With the driest winter in 70 years, BPA these days faces the difficult task of producing power while meeting the obligations of the US Endangered Species Act.

Speaking in Seattle last week, Oregon Gov. John Kitzhaber (D) suggested that by skipping its annual payment this year, BPA could have enough money to buy expensive power during the current crisis and thereby avoid having to run extra water through the turbines at the expense of endangered fish in the Columbia River Basin.

"The health of the Northwest economy and its shared ecosystem depend to a large degree on low-cost power," Governor Kitzhaber said.

Kitzhaber's idea is not going over well, especially in Washington State, which relies on Bonneville power more than its neighbors. Gov. Gary Locke (D) and BPA officials say missing a Treasury payment would just give the region's political opponents more ammunition.

"Senators and Representatives from high-cost power states would love any excuse to tamper with BPA and the 60-year-old public preference that keeps rates low," the Seattle Times editorialized this week. "Every session of Congress inspires another covetous assault on BPA. Why poke the bear by not making a payment on what others already see as a scandalous bargain and rare sweetheart deal?"

Loss of seniority in Congress

Loss of Congressional seniority could put the region in an even tighter political bind. Gone are the days when Warren Magnuson and Henry "Scoop" Jackson from Washington, and Mark Hatfield and Bob Packwood in Oregon, had enough clout in the US Senate to fend off politicians targeting the region's cheap power. Democrats even bemoan the recent loss of Sen. Slade Gorton (R) of Washington.

"The system is really at risk now," says Robert Royer, communications director for Seattle City Light, the city's electrical utility. "Every Republican administration has wanted to take [BPA] over because of the perception that it's been subsidized by the rest of the country, which is just not true."

Second of two parts.

(c) Copyright 2001. The Christian Science Publishing Society