SENATE BILL REPORT

SJM 8001

As Passed Senate, February 14, 2003

Brief Description: Requesting increased borrowing authority for the Bonneville Power Administration.

Sponsors: Senators Fraser and Morton.

Brief History:

Committee Activity: Natural Resources, Energy & Water: 1/22/03, 1/24/03 [DP].

Passed Senate: 2/14/03, 49-0.

SENATE COMMITTEE ON NATURAL RESOURCES, ENERGY & WATER

Majority Report: Do pass.

      Signed by Senators Morton, Chair; Hewitt, Vice Chair; Doumit, Fraser, Honeyford, Oke and Regala.

Staff: Richard Rodger (786-7461)

Background: The Bonneville Power Administration (BPA) owns and operates more than 75 percent of the region's high-voltage transmission system with over 15,000 miles of line covering 300,000 square miles. The area includes primarily Washington, Oregon, Idaho and western Montana and portions of contiguous states.

The BPA and other Northwest transmission owners are experiencing increasing limitations on their ability to move power from where it is generated to where it is needed. In particular, the BPA has identified significant limitations in its ability to move power from eastern Montana to the Seattle area, from the John Day Dam area on the Columbia River to the Seattle area, and from the McNary Dam area on the Columbia River to the Portland area.

In addition to existing constraints, integrating the new generation projects being proposed in the region will require the BPA to undertake major work to install new equipment and reinforce existing transmission lines to carry the power.

Financing for the BPA's transmission infrastructure has historically come in the form of loans from the Federal Treasury, which are paid back through the rates the BPA charges it customers. The BPA's borrowing authority for this and other capital improvements is currently capped by Congress at $3.75 billion. This cap has been in place since the early 1980s.

The BPA has requested that its borrowing authority be increased by $2 billion to accommodate the long-term demand for necessary improvements and upgrades to the system, including new transmission lines and facilities.

The governors in several western states are currently developing a plan to streamline and coordinate interstate transmission siting and have signed a Memorandum of Understanding with five federal agencies hoping to create a framework for these agencies to cooperate with the states in the review of any proposed transmission lines.

Summary of Bill: The Legislature requests that Congress and the President approve an additional $2 billion in Federal Treasury borrowing authority needed by the Bonneville Power Administration for capital improvements to the Federal Columbia River Power System, principally for the purpose of making critical transmission infrastructure investments.

The Legislature also requests that Congress require the Federal Energy Regulatory Commission to defer to state and regional interstate transmission siting processes and to not preempt state authority in this area.

Appropriation: None.

Fiscal Note: Not requested.

Testimony For: None.

Testimony Against: None.

Testified: No one.