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Defending the BPA Fort by Editors The Oregonian, January 22, 2001

California's energy mess puts Northwest politicians on notice:
Be ready to fight to retain cheap hydro power

In the mid-1970s, we were told by energy gurus that the difference between a power crunch and a power crisis was simple:

A power crunch was like a bad cold giving you a few days or weeks with sniffles. A power crisis, on the other hand, was full-blown pneumonia.

What we've seen in California over the past two weeks is pneumonia. And it's clearly giving the Northwest power supply system a bad cold -- and the threat of something far worse.

The threat is a potential power grab. It's no secret that California's congressional delegation -- a delegation much more powerful in number and influence than the Northwest's -- would like to control, if not own, the Bonneville Power Administration and the federal hydroelectric system that produces our cheap power.

Indeed, one of the reasons given for California's rolling blackouts last week was the fact that the Northwest could not -- and in some circles that was translated as "would not" -- send the power that cash-strapped California utilities needed to keep homes and businesses lit and warm.

Given that groups throughout energy-hungry America, not just the power gluttons in California, envy the Northwest's regional power grid and its hydro system, Northwest political leaders should brace for a fight in Congress over Northwest kilowatts.

Even though it was comforting to hear Spencer Abraham, the next energy secretary, say that he no longer advocated selling BPA to the highest bidder, the truth is that Abraham, as a senator from Michigan, was one of the leaders of the movement to sell BPA and to force BPA customers to pay market-based rather than cost-based rates.

That would devastate the Northwest economy, which -- with its aluminum industry, pulp and paper industry and high-tech server farms -- thrives largely on the availability of cheap electricity. For a glimpse of how bad things could be here, one only has to look at how much utilities had to pay last week for a single megawatt-hour of electricity.

Last year at this time, the price for a megawatt-hour was about $35. Last Thursday, it was $750.

It's no wonder that California's near-bankrupt Pacific Gas and Electric Co., which has had to pay those prices for the energy it gets from the spot market, has warned state officials that as many as 2.6 million customers could face up to 12 hours a day without electricity unless the state bails it out.

The West Coast energy crisis should be reason enough for all four Northwest states -- Oregon, Washington, Idaho and Montana -- to stop their internal bickering over how BPA's cheap kilowatts are distributed. They should instead unite behind a strategy, first proposed by Gov. John Kitzhaber and Oregon Senate President Gene Derfler, R-Salem, to regionalize the BPA and keep the bulk of the power here.

Buying BPA, absorbing its $7 billion debt and controlling the economic engine on the Columbia River, would be a huge venture for the four Northwest states. Such a transaction faces dozens of major obstacles, including constitutional questions.

But given the inflated state of the West Coast power market -- and with those skyrocketing prices not expected to go away anytime soon -- the four Northwest states ought to take over the federal power marketing agency and the hydro system.

Before somebody else does.