03.03.05

Cantwell Pushes Bush Administration to Abandon Northwest Rate Hike Plan

Some residents could see power billsrise nearly $500 a year under Administration proposalUnder questioning from Northwest Senators, Energy Secretaryclings to BPA rate hike proposal

WASHINGTON, D.C. – U.S. Senator Maria Cantwell (D-WA) today called on Energy Secretary Sam Bodman to abandon the Bush Administration's proposal to raise North west power rates by $1.7 billion. At a hearing of the Senate Energy & Natural Resources Committee, of which she is a member, Cantwell pressed the Secretary to give up the Administration's plan to raise the electricity rates of the Bonneville Power Administration (BPA). The North west Power Planning Council has calculated that the Bush Administration's proposal would raise some Washington families' energy bills by $480 a year, and reduce "personal income" in the North west by $1.3 billion.

"This proposal would turn the lights out on the North west economy," Cantwell said.

While Senate Budget Committee Chairman Judd Gregg (R-NH) yesterday announced he would not include the rate hike proposal in the Senate's Fiscal Year 2006 budget resolution, Secretary Bodman said the Bush Administration still stands by its proposal. Under a barrage of questioning from a bipartisan group of North west senators, Bodman acknowledged that the rate hike would require new legislation—legislation that Cantwell and other North west senators vowed to block.

"Taking money out of working families' pockets, causing job loss and forcing businesses to leave the North west is exactly the opposite of sound economic policy," Cantwell added. "But the fact is, it's illegal for the Administration to spend North west taxpayers' money to develop this rate hike proposal, just so it can turn around and raise their energy rates. Now that we know the Administration still wants to push it, we need to make sure the message is clear: we'll bring to a screeching halt any piece of legislation that contains this proposal."

At the hearing, Cantwell challenged the Department of Energy's authority to pursue its North west rate hike plan. A provision contained in the Fiscal Year 1993 Energy and Water Development Appropriations Act (PL 102-377) explicitly prohibits DOE and other federal agencies from "conducting any studies relating or leading to the possibility of changing from the currently required ‘at cost' to a ‘market rate'" for BPA power.

The Administration's Fiscal Year 2006 budget said it would propose legislation to raise BPA's rates until they are roughly the same as rates charged elsewhere in national electricity markets. Since its creation in the 1930s, BPA's rates have been based on costs—rather than market prices, which are typically about double. Bonneville provides about 70 percent of the power consumed in Washington state.

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