Council Document 2001-21A
21ST ANNUAL REPORT

of the 

Pacific Northwest Electric Power and Conservation

 Planning Council

Submitted to the

Committee on Energy and Natural Resources

United States Senate 

Committee on Energy and Commerce

United States House of Representatives

and

Committee on Resources

United States House of Representatives

October 1, 2000 through December 31, 2001

Northwest Power Planning Council

851 S.W. Sixth Avenue

Suite 1100

Portland, Oregon 97204

503-222-5161

Toll Free: 800-452-5161

www.nwcouncil.org

The Northwest Power Planning Council was established pursuant to the Northwest Power Act of 1980 

(Public Law 96-501) by the states of Idaho, Montana, Oregon and Washington. The Act authorized the 

Council to serve as a comprehensive planning agency for energy, fish and wildlife policy in the Columbia 

River Basin and to involve the public in decision-making.

This annual report has been developed pursuant to Section 4(h)(12)(A) of the Northwest Power Act.

The Council’s bylaws, which include its organizational structure, practices and procedures, are available to 

the public. Please request Council Document 96-13 or visit our web site: www.nwcouncil.org.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 7

TABLE OF CONTENTS

THE NORTHWEST POWER PLANNING COUNCIL 8

POWER ISSUES 8

A. RELIABILITY AND ADEQUACY OF THE REGION’S ELECTRICITY SUPPLY 8

B. ELECTRICITY PRICES ANALYSIS 10

C. PREPARING FOR THE NEXT NORTHWEST POWER PLAN 12

1. Demand Forecasting 12

2. Direct use of natural gas 13

D. ENERGY CONSERVATION 13

E. REGIONAL TRANSMISSION ORGANIZATION 15

FISH AND WILDLIFE ISSUES 16

A. ANALYSIS AND RECOMMENDATIONS REGARDING 2001 HYDROSYSTEM OPERATIONS 16

B. A MAINSTEM PLAN FOR THE COLUMBIA RIVER BASIN FISH AND WILDLIFE PROGRAM 18

C. SUBBASIN PLANNING 19

D. MITIGATING THE IMPACT OF HYDROPOWER ON FISH AND WILDLIFE 21

1. Projects Funded Directly by Bonneville Through the Columbia River Basin Fish and Wildlife Program 21

2. Projects Reimbursed to Federal Agencies by Bonneville 21

3. Innovative Projects 22

4. High Priority Projects 22

5. Emergency Hydropower Operations Offset (“Action Plan”) Projects 22

E. OTHER FISH AND WILDLIFE INITIATIVES 22

1. Caspian Tern Relocation 22

2. Artificial Production Review Committee 23

3. Inaugural Annual Report of the Fish and Wildlife Program, 1978-2000 24

PUBLIC INVOLVEMENT 25

FISCAL YEAR 2001 COUNCIL BUDGET 25

MORE INFORMATION 26

COMMENTS OF THE BONNEVILLE POWER ADMINISTRATION 26

COUNCIL MEMBERS AND OFFICES 29
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 8

POWER ISSUES

A. Reliability and Adequacy of the Region’s 

Electricity Supply

In 1999, at the request of the Bonneville Power 

Administration, the Council conducted an analysis 

of the reliability of the region’s electricity supply. 

There was concern about the reliability of the system 

in light of a number of developments, including: 1) 

limited power plant development; 2) variability in 

precipitation and the resulting impact on hydroelectric system capability; and 3) the potential impact of 

extreme cold and dry winter weather and the resulting high demand for power.

Among the conclusions in the Council’s report, 

which was completed in January 2000:

• The probability of some level of power supply 

inadequacy was becoming uncomfortably high - 

then predicted to reach 24 percent by 2003.

• The causes of the reliability problem were seen 

as combinations of extreme cold weather, poor 

hydropower generating conditions and possible 

forced outages of generating units.

• With the exception of unscheduled generation 

outages, these problems were seen as largely 

predictable. That is, they can be predicted at 

least a day in advance.

• The frequencies and duration of these 

events are relatively small, although their consequences could be quite costly. Because of this 

limited frequency and duration, it was considered unlikely that the expected market price of 

power would support building sufficient capacity to address these kinds of problems.

• Relatively few electricity customers see real-time 

market prices, and this mutes the demand response 

to impending supply inadequacy problems.

• The most promising short-term response to these 

problems was seen as voluntary load-shedding by 

electricity consumers, particularly large users. 

Following its analysis of the problem, the 

Council undertook a second phase of the report 

in which it developed potential solutions with the 

advice and comments of regional energy experts. 

In a report issued March 6, 2000 (Council Document 2000-4), the Council offered the following 

THE NORTHWEST POWER PLANNING COUNCIL

The Council is an agency of the states of Idaho, Montana, Oregon and Washington and was created 

as an interstate compact agency by the legislatures of the four states following President Jimmy Carter’s 

approval of the Pacific Northwest Electric Power Planning and Conservation Act in December 1980. 

The Council’s first meeting was in April 1981.

The Northwest Power Act gives the Council three distinct responsibilities: 1) to assure the region 

an adequate, efficient, economical and reliable electric power supply; 2) to prepare a program to 

protect, mitigate and enhance fish and wildlife of the Columbia River Basin that have been affected 

by the construction and operation of hydropower dams; and 3) to inform the Pacific Northwest public 

about energy issues and involve the public in decision-making. This annual report is organized around 

the Council’s three key responsibilities.

There are eight Council members – two from each state – appointed by the governors. A list of 

Council members and their office locations is at the end of this report. 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 9

observations and recommendations to ease the 

power shortage:

• Provide incentives for construction of new 

power plants. As the result of deregulation and 

price competition among wholesale power suppliers, currently there is no assurance that the 

costs of a new plant will be recovered from 

power sales, and as a consequence few new 

plants are being built. Developers of new power 

plants now need periods of high prices in order 

to be able to recover their costs.

• Make electricity consumers, particularly the 

largest users, part of the solution. For example, 

compensate consumers for voluntary load reduction when the supply is tight, rather than involuntarily interrupting all customers.

• Revisit power sales contracts. Utilities that 

face the biggest problems during periods of high 

demand are those that buy a lot of power on 

the open market through short-term contracts 

rather than through longer-term arrangements 

that could be the basis for developers building 

new power plants.

• Investigate utilizing existing self-generation 

when needed. As much as 500 megawatts of 

installed power generation at large industries, 

which is used primarily by those industries, 

could be dispatched into the regional power grid 

during an emergency, but there are potential 

economic and environmental barriers that need 

to be better understood.

• Procedures and communications protocols have 

to be in place for effective short-term load reduction, including metering. Now is a good time to 

begin creating the partnerships and preparing to 

respond to future emergencies, if they develop.

When the price spikes of the summer of 2000 

occurred, the Council prepared an analysis of the 

situation (Council Document 2000-18). The analysis 

saw the price behavior of that summer as essentially 

confirmation of the power supply adequacy problems 

identified in the earlier report. The analysis identified the causes of the price spikes as the interaction 

of the fundamental undersupply of generation with 

the onset of poor hydro conditions, hot weather, the 

limited response of retail demand to wholesale prices 

and characteristics of the dysfunctional California 

market design. 

The Council continued to issue periodic updates 

of the ongoing power system analysis through the 

winter and into the spring. On April 4, 2001, the 

Council completed a report entitled “Analysis of 

2001-2002 Power Supply Outlook” (Council Document 2001-07). In that report, the Council noted that 

operational strategies for the Columbia/Snake river 

hydropower system are a key component of managing the hydrosystem through 2001. Objectives for 

hydrosystem operations included:

• Satisfying electricity demand through the spring 

and summer;

• Achieving reasonable summer flows for salmon 

migration; 

• Not significantly worsening fall and winter 

reliability and the ability to meet reservoir target 

elevations for 2002 in the 2000 Biological Opinion on Operation of the Federal Columbia River 

Power System issued by the National Marine 

Fisheries Service; and

• Limiting the impacts of wholesale power purchase costs on the region’s economy and the 

financial condition of the region’s utilities.

To assess the options available to the region, the 

Council analyzed several alternatives for the operation 

of the power system in 2001. The analysis was 

done in two stages. The first focused on the spring 

and summer for two water scenarios – 1977 water 

and 1944 water, the lowest and second-lowest in 

the Columbia River Basin, respectively. Those years 

bracketed the current runoff volume forecast for 2001. 

For each of those water years, several operating strategies were evaluated. They included: running the 

hydropower system to the 2000 Biological Opinion 

constraints for spill and flows; maintaining spill while 

drafting the system deeper to meet loads; and three 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 10

strategies that involved significant reductions in spill 

combined with limited use of deeper drafts, with the 

objective of achieving Biological Opinion reservoir 

elevations by the end of August. The analysis looked 

at such metrics as the amount of curtailment that 

could be experienced, the cost of purchased power 

to address any curtailment, end-of-August reservoir 

elevations, and spring and summer flows.

The second stage of the analysis focused on the 

operation of the system through the fall and winter 

with the starting elevation of the reservoirs in September being the primary variable. This analysis 

was done probabilistically with uncertainty about fall 

and winter water conditions, temperatures and forced 

outages of thermal units. The analysis looked at the 

probability and magnitude of load loss during the 

winter period and April 2002 reservoir elevations. 

The conclusions drawn from this analysis were:

• Extreme efforts to reduce loads and bring on 

new generation were required. 

• Even with such efforts, operating the hydropower system to the 2000 Biological Opinion 

targets for spill and flows would lead to either 

significant curtailments and/or very large purchased power costs this summer.

• Operations during spring and summer that 

leave reservoirs at the end of August at elevations significantly below 2000 Biological Opinion elevations expose the region to significantly 

increased probability of power supply inadequacy next winter. In addition, such operations 

would result in a significant probability that 

April 2002 reservoir elevations would be well 

below Biological Opinion elevations, thereby 

reducing spring flows for salmon.

• The only alternatives that both avoid curtailments and/or large purchased power costs in 

the summer of 2001 and return reservoirs to 

Biological Opinion elevations by the end of 

August involve substantial reduction in spill and 

limited drafting of reservoirs beyond Biological 

Opinion elevations. Reductions in spill can be 

restored by power purchases, reductions in load 

and additional generation. Alternatives that significantly reduce spill have the additional advantage of reducing market prices in the summer 

of 2001 and bringing additional income into the 

region in the form of dollars, returned energy 

next fall and winter, or both.

• The Council recommended that decisions be 

made at that time, but with the understanding 

they could be revisited periodically later in the 

year. From the power supply standpoint, a prudent approach would be to significantly reduce 

spring spill, the Council recommended, noting 

that if conditions did not improve, the spill 

energy would be lost to the system.

As noted elsewhere in this annual report, power 

prices dropped and the supply increased in the late 

summer. This is not at all indicative of error in the 

Council’s analysis. Rather, it is the result of actions 

having been taken consistent with the Council’s recommendations. A significant amount of new permanent 

and temporary generation was brought on line, loads 

were reduced significantly through buyouts, voluntary 

curtailments and conservation, and over 4,000 megawatt-months of energy was not spilled. The Council 

conducted the best analysis and offered the best advice 

based on that analysis that was possible at the time.

The power system analysis continued through the 

fall of 2001, when the Council reported that the 

region faced less than a 1-percent probability of 

deficits in the winter of 2001/2002 thanks to an 

improved power supply in the Northwest and California, energy conservation and emergency hydropower operations last spring and summer that 

resulted in higher resevoir levels for the fall and 

winter. While this was good news, it must be tempered by the realization that the improved outlook 

resulted largely from reduced demand brought about 

by the economic recession.

B. Electricity Prices Analysis

Within a few months of the Council’s report, 

wholesale electricity prices began to rise rapidly. By 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 11

the winter of 2000/2001, wholesale prices averaged 

$250 per megawatt hour, a tenfold increase over 

prices just a year earlier, and in December prices 

briefly peaked over $1,300 per megawatt hour.

In 2001, the Council continued its ongoing analysis of the volatile wholesale electricity market in 

response to significant regional concern about electricity supplies and prices this year and beyond. 

Our analysis indicated that the concern is wellfounded. On March 26, the Council issued a paper 

entitled “Northwest Electricity Markets in 2001: 

Status and Proposed Actions” (Council Document 

2001-5). The purpose of the paper was to clarify the 

electricity situation for 2001, to note the actions that 

are being taken to address the problem, and to urge 

additional actions that can be taken to help improve 

this year’s prospects for meeting electricity needs 

while minimizing impacts on fish programs and the 

regional economy.

In summary, the Council concluded that Western 

electricity markets were headed for a difficult 

summer and possibly a difficult winter of 2001/2002. 

Then current poor water conditions appeared to 

translate into continued tight electricity supplies for 

the remainder of the year. The Council predicted 

that accompanying high electricity prices could combine with a general slowdown in economic activity 

to create difficulties for many of the region’s businesses and citizens.

However, the addition of new supply, notably natural gas-fired generating plants in Oregon, Idaho 

and California, reduced industrial demand for power, 

increased energy conservation, moderate weather and, 

as a result, moderate demand for electricity, combined 

to actually drive prices down by mid-year to levels 

that had not been experienced since 1999. The 

news was not all good, however. Industrial demand 

was lower because thousands of people lost their 

jobs when industries reduced production or closed in 

response to high power prices during the fall of 2000 

and the winter of 2001. Many utilities and businesses 

installed temporary generators, mainly small, dieselfired power plants, that make electricity for around 

$100-$140 per megawatt hour – an attractive option 

when the market price is $200 or higher, but these 

plants were highly polluting. As the wholesale power 

price plummeted in the mid- to late summer of 2001, 

many of these plants became uneconomical to operate. Spill reductions at Snake and Columbia river 

dams in the spring and summer of 2001 contributed 

to the energy supply but also increased impacts on 

migrating juvenile salmon and steelhead. Bonneville 

was successful in restoring end-of-summer reservoir 

levels to Biological Opinion levels and storing additional water in Arrow reservoir in Canada.

The report on electricity markets recognized that 

individuals, businesses and utilities took actions to 

reduce energy demand. The report recommended 

the following additional actions that should be 

taken regionally:

• Public leaders should continue to inform and 

educate the public about the electricity problems 

faced by the region this year. Public awareness 

can be one of our most effective tools. 

• Parties in the region need to come to agreement 

about hydropower operating strategies for the 

summer that prioritize water usage to strike an 

appropriate balance among reliability of electricity supply, costs to the region’s economy, 

the financial health of the region’s utilities and 

salmon recovery goals.

• Utility regulators should support and 

expedite utility programs to implement emergency demand management programs.

• Siting and environmental agencies should expedite emergency siting of short-lead-time generation while still protecting the longer-term 

societal interests.

• The region’s utilities should seek to bring costeffective emergency standby generation into the 

grid. Environmental agencies should cooperate 

by expediting temporary operating permits for 

such facilities, if necessary.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 12

• Environmental agencies should work to temporarily relax restrictions that prevent existing 

generating plants from continued operation 

at full capacity, without jeopardizing public 

health and safety.

• Utilities and public agencies should expand the 

scope and funding of existing energy efficiency 

programs that can be expected to deliver savings 

in the short term.

• Utilities, the Bonneville Power Administration 

and regulatory agencies should begin the process of designing electricity pricing structures 

that provide price signals to help develop 

demand response to prices and shortages.

• State and local agencies should ensure 

that low-income assistance programs are adequately funded to respond to impacts from high 

electricity prices.

C. Preparing for the Next Northwest Power Plan

The Fourth Northwest Power Plan was approved 

in draft by the Council in March 1996 but held open 

through 1996 during the Comprehensive Review of 

the Northwest Energy System. The Council then 

issued an addendum to the plan reflecting the recommendations of the Comprehensive Review Steering 

Committee and, following public comments, issued 

the final version of the plan in July 1998.

In 2001, with power system reliability and adequacy at the forefront of contemporary electricity 

issues in the Northwest, the Council is beginning to 

set the stage for the next iteration of the power plan. 

To that end, the Council staff prepared two issue 

papers for public comments, one dealing with energy 

demand forecasting, a critical task for the Council 

in preparing its power plans, and the other on 

the direct use of natural gas to replace major electricity uses in the home, such as space and water 

heating. More specifically, the Council is exploring 

whether to treat fuel switching to natural gas as an 

electricity conservation resource, which is not specifically acknowledged in the Northwest Power Act.

1. Demand Forecasting

The issue paper on demand forecasting (Council 

Document 2001-13), initiated a discussion about 

future Council forecasting of the demand for electricity. Many of the critical detailed components of 

the Council’s models are becoming outdated due to 

reliance on old information about regional energy 

use. The Council needs to gauge the region’s opinions about the value of its demand forecasting and 

what level of support is warranted for future demand 

forecasting techniques.

The paper described the historical context of 

the Council’s Demand Forecasting System, which 

is important to explain the choice of models and 

procedures used to develop the Council’s electricity 

demand forecasts in past power plans. The changing structure of electricity markets has changed the 

environment in which the Council does its forecasting and planning. As a result, it is important 

to reassess the approach to demand forecasting 

in light of new requirements and regional needs 

before substantial sums of money and regional 

effort are put into developing a new demand forecasting system.

The paper explained the current forecasting 

system in general terms and invited comments 

on its usefulness, explained the various uses of 

the forecasts within the Council’s planning process and by others in the region, and proposed several alternative approaches to both the upcoming 

power plan revision and the longer-term demand 

forecasting role.

The Council accepted public comments on the 

paper and then decided, after reviewing the comments, not to make substantial changes to the 

demand forecast in the 1998 Power Plan. Public 

comments indicated a clear need to focus more 

effort on near-term peak loads and load shapes than 

on long-term demand. Commentors split on the 

question of whether the Council should perform 

detailed analyses of long-term demand. The Coun-
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 13

cil will take up the issue again as work on the next 

power plan progresses.

2. Direct Use of Natural Gas

In the Fourth Northwest Power Plan, the Council 

addressed the role of direct uses of natural gas for 

space and water heating, compared to using electricity for those purposes. It is the Council’s interpretation of the Northwest Power Act that direct uses of 

natural gas do not constitute a generating resource 

and do not constitute a form of energy conservation 

when installed in place of electric appliances. However, natural gas utilities have suggested to the Council that a campaign to convert electric space and 

water heat to natural gas could help alleviate the 

electricity supply shortage in the region.

In light of the proposal from the natural gas 

utilities and the predominance of natural gas-fired 

combustion turbines being used in new electricity 

generation, the Council decided to reconsider its 

natural gas policies. The issue for the Council is 

whether it is better to use natural gas directly for 

space and water heating, rather than using it to generate electricity for these end uses. Also in question is 

whether the Council should take a role in these fuel 

choice decisions, and if so, what that role should be.

An issue paper (Council Document 2001-17) laid 

out a number of possible actions and policies that 

could be combined to form a Council policy. The 

Council’s Power Committee met with a panel of 

energy industry experts in August, and also with representatives of the Pacific Northwest Utilities Conference Committee in September to discuss fuel 

switching. After considering these comments and 

discussions, the Council decided to maintain its current policy – encouraging a market-based approach 

to fuel switching, one that preserves individual 

choices about energy sources and recognizes that 

substantial benefits can accrue from healthy competition among natural gas, electricity and other fuels. 

The Council may pursue the issue further, and will 

decide that as it develops the new power plan.

D. Energy Conservation

In the Northwest Power Act, energy conservation 

is treated as an electricity resource the same as 

generating plants. The Council’s first Northwest 

Power Plan, adopted in 1983, made conservation 

the resource of choice to meet future demand for 

power in the region, and since that time the region’s 

utilities and the Bonneville Power Administration 

collectively have acquired more than 1,500 megawatts of energy conservation – more than enough to 

power the city of Seattle.

The Council’s current power plan, which dates 

to July 1998, established conservation acquisition 

targets for the region that, unfortunately have not 

been met. The primary reason appears to be 

the same reason construction of new generating 

plants has lagged behind demand for power – 

uncertainty associated with the ongoing restructuring of the electricity industry, combined with unattractive price signals from the volatile, deregulated 

wholesale electricity market, discouraging investment in new resources. Developers have been 

reluctant to invest millions of dollars in new generating or conservation resources if they perceive 

a risk that the investments will be stranded in 

the future by low market prices. Yet if the Council’s conservation targets had been met, it could 

be argued that price volatility might have been tempered by the additional energy “supply” in the form 

of reduced demand for power.

Regional conservation achievements have been 

tracked by the Regional Technical Forum, a panel of 

energy experts formed by the Council in July 1999. 

The purpose of the RTF is to further the implementation of energy conservation and renewable energy 

resources in the Northwest. Specifically, the RTF 

developed standards and protocols by which electric 

utilities could assess the effectiveness of conservation activities. The RTF tracks and reviews 

regional progress toward conservation and renewable 

resource goals, and provides feedback and suggestions for improving conservation and renewable pro-
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 14

grams in the region. In addition, Bonneville asked 

the RTF to establish and update recommended lists 

of standard conservation measures with their estimated savings and regional value, evaluate protocols 

not on the standard list and track accomplishments. 

The lists and estimated savings will be used by utilities to design conservation and renewable resource 

programs eligible for Bonneville’s conservation and 

renewable resources discount during the 2002-2006 

rate period, which began in October 2001.

The results of the RTF’s survey of conservation 

achievements, posted on the Council’s website, 

www.nwcouncil.org, show that since 1997, a year 

after the Council published its regional conservation 

targets in its draft Fourth Northwest Power Plan, the 

region has acquired only about half as much conservation as the Council proposed. Specific amounts, 

by utility and by year, also are posted on the Council’s website under the tab labeled Conservation.

Despite the lackluster achievement to date, the 

Council believes there is great potential for additional conservation acquisitions despite the volatile 

wholesale power market. The power plan estimated 

the potential at 1,535 megawatts at a price of 

about 2.5 cents per kilowatt-hour ($25 per megawatthour). But in light of generally higher market prices 

for power today than in 1998, when the Council 

issued the power plan, it appears there is an additional 2,000-2,400 average megawatts of conservation potential at a cost between 2.5 cents and 5.5 

cents per kilowatt hour ($25 to $55 per megawatthour). Sixty percent of the additional potential conservation is in industrial and commercial settings.

In an August 2001 report to a Congressional 

subcommittee investigating solutions to the regional 

energy shortage, the Council testified about potential 

energy conservation and offered the following recommendations for utilities and their customers:

• Mobilize citizens and businesses to take actions 

that improve the efficiency of energy use, not 

just curtail their use.

• Focus investments by utilities and businesses 

on energy efficiency measures that can be put 

in place quickly, such as installing compact 

fluorescent light bulbs in residences, replacing 

commercial building lighting, improving the 

efficiency of commercial building heating and 

cooling systems, fixing compressed air leaks in 

industrial settings, installing controls on vending 

machine lighting and cooling, and retiring aged 

and second refrigerators.

• Change the conservation “message” from curtailment, which many people translate as “freeze 

in the dark” to “efficiency,” which means using 

less electricity with no loss of comfort.

• Coordinate a “Call to Arms” for conservation 

among utilities and others.

Meanwhile, in October 2001 the Council released 

an analysis that asserts the Pacific Northwest could 

acquire an amount of energy conservation equal to 

the output of a large natural gas-fired power plant 

during the next three years – about 300 megawatts 

– at a lower cost than building such a plant. New 

energy conservation would save electricity now and 

also help moderate future price spikes such as those 

that battered the region’s utilities and consumers in 

the last year, according to the analysis.

The 300 megawatts, which the analysis calls “an 

efficiency power plant,” is an interim target to be 

pursued while the Council works on developing the 

next power plan. The interim target is intended to 

encourage utilities and others responsible for conservation implementation to maintain the conservation 

momentum developed over the last year in response 

to high power prices.

During the last few years of the 1990s, utilities 

developed conservation at half the rate the Council 

had determined to be cost effective in the 1998 power 

plan. Had the cost-effective conservation been fully 

developed, it would have displaced approximately 

180 megawatts of power, enough for about 100,000 

average Northwest homes. Because it was not developed, the region’s utilities had to purchase that much 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 15

more power, often at extraordinarily high prices. By 

establishing an interim conservation target, the Council seeks to ensure that the region is not in the same 

position when prices become volatile again.

According to the analysis, the region could 

acquire approximately 100-110 megawatts of conservation per year for the next three years for less than 

the cost of power from a new combustion turbine - 

about 3 cents per kilowatt-hour for the conservation. 

The cost of a new gas-fired plant is in the range of 

3 to 3.5 cents per kilowatt-hour. Almost 60 percent 

of the conservation potential is in commercial and 

industrial structures and applications, according to 

the analysis.

The analysis is posted on the Council’s website.

E. Regional Transmission Organization

Federal Energy Regulatory Commission (FERC) 

Order 2000 envisions the use of collaborative 

processes as the means for developing regional transmission organizations (RTOs) throughout the country. These organizations would 1) administer 

transmission systems in a way that encourages the 

efficient use and expansion of the systems; 2) 

manage congestion on transmission lines; 3) plan 

upgrades and additions; and 4) deal with technical 

issues on a coordinated systemwide basis.

In the Northwest, the RTO filing utilities made 

an initial filing with FERC in October 2000 and are 

continuing their collaborative process with a target 

of a more complete Stage Two filing at FERC by 

March 1, 2002. The Council is participating in 

the collaborative process of developing a Northwest 

RTO, called RTO West.

The filing utilities are addressing a number of 

issues raised by the Council and regional stakeholders. The effort is more complicated in the Northwest 

than elsewhere in the country because much of the 

high-voltage transmission in the region is owned 

and operated by the Bonneville Power Administration. Mixing federal and non-federal transmission 

under the same management entity is challenging. 

Nonetheless, the filing utilities are developing their 

proposal in a collaborative process that includes discussion of creating a non-profit entity with management responsibility for the transmission assets of 

participating utilities, including Bonneville.

In a letter to the utilities in April 2000, thenFERC Chair James Hoecker praised the Northwest 

effort as “the most well-organized” in the country 

and “truly historic in terms of both electricity policy 

and regional compromise and coordination.” Further, Hoecker noted, “I understand the challenges 

faced by the economically diverse Northwest region 

in terms of its relationship with Canadian interests, 

the importance of hydro resources, the central role 

played by the Bonneville Power Administration in 

the region, and the variety of utility, consumer and 

environmental interests involved. It is clear that you 

have nevertheless seized the opportunity presented 

by Order No. 2000 to create a workable RTO that 

serves the special needs of the region.”

Partly in response to the difficult Western power 

market over most of the period since the summer of 

2000, FERC has become more aggressive about the 

geographic scope it would like to see in RTOs. It 

has indicated in several orders that it would like to 

see a single west-wide RTO rather then the three 

that are currently in various stages of development 

– RTO West, Desert STAR and the California ISO. 

Moreover, it has indicated that it believes RTO West 

could provide the best platform for a west-wide 

RTO. However, many Western interests believe that 

this would be a very difficult goal, at least in the 

short run. Consequently, a significant effort is underway among the three Western RTO candidates to 

ensure that the creation of the three RTOs addresses 

FERC’s concerns and does not create market barriers 

at the seams between them, but rather enhances the 

competitive power market. The Council is active in 

that effort.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 16

FISH AND WILDLIFE ISSUES

A. Analysis and Recommendations Regarding 

2001 Hydrosystem Operations

In the spring of 2001, with Columbia River 

Basin runoff shaping up as the worst or second-worst on record, the Council offered recommendations for spring and summer hydrosystem 

operations in recognition of the poor runoff conditions, growing Bonneville Power Administration 

financial problems from decreased hydropower and 

looming concerns about the adequacy and reliability 

of the region’s energy supply.

In a paper issued March 30 entitled “Analysis 

of 2001 Federal Columbia River Power System 

Operations on Fish Survival” (Council Document 

2001-06), the Council recognized that the operations 

of the Federal Columbia River Power System 

(FCRPS) most likely would be changed this year 

to optimize power production and help offset the 

growing Northwest power shortage. At that time, 

reductions in spill for juvenile fish passage at the 

dams were considered one way to help meet energy 

demand. While spill reductions may help ease the 

difficult power situation, it was unclear how those 

reductions would affect juvenile fish survival. To 

help answer that question, Council staff examined 

the possible relative biological effects of various spill 

and smolt transportation alternatives on Columbia 

Basin fish survivals.

While there are many unlisted hatchery and naturally spawning populations in the Columbia Basin, 

the Council analysis focused solely on ESA-listed 

stocks. The 2000 Biological Opinion uses a combination of strategies to help juvenile salmon and 

steelhead migrating to the ocean pass through or 

around each hydroelectric dam on the Columbia and 

Snake rivers. There are four possible routes: 1) 

through a juvenile bypass system, which intercepts 

fish with screens and routes them through a specially 

designed passage in the dam; 2) by opening the spill 

gates, which routes the fish over the spillway but 

decreases the water available for generating electricity; 3) through the turbines, which is not a preferred 

route due to reduced survival; and 4) by intercepting 

fish and transporting them in barges to a release 

point below the hydroelectric system.

The Council used the SIMPAS model of the 

hydrosystem to project juvenile fish survival under 

various hydrosystem operations, the same model 

used by the National Marine Fisheries Service in the 

2000 Biological Opinion. The Council’s analysis 

demonstrated that, when compared to full implementation of the 2000 Biological Opinion under 2001 

water conditions, spill reductions at FCRPS dams:

• Have little to no effect on the total system 

survival of Snake River spring/summer chinook, 

Snake River steelhead or Snake River fall chinook.

• Decrease total system survival for upper 

Columbia spring chinook, upper Columbia 

steelhead and middle Columbia steelhead to 

the highest extent compared to other populations (these stocks are not transported and pass 

through several dams).

• Have less effect on the total system survival 

for lower Columbia chinook and lower Columbia 

steelhead because 1) most of the these listed populations are geographically situated below Bonneville Dam and 2) the Lower Columbia chinook 

and steelhead only pass Bonneville Dam.

When compared to full implementation of the 

2000 Biological Opinion under 2001 water conditions, the Council’s analysis demonstrated that full 

transportation of smolts from McNary Dam with no 

spill at other mainstem federal dams:

• Increases upper Columbia spring chinook total 

system survival under all alternatives.

• Increases upper Columbia steelhead total system 

survival under most conditions.

For the alternatives examined, estimated adult 

losses for listed fish ranged from:
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 17

• Zero adults lost for Snake River steelhead (0.0 

percent of total return) to 2,535 upper Columbia 

spring chinook adults lost with no transport at 

McNary Dam (12.7 percent of total return).1

On April 5, the Council offered preliminary recommendations to the federal operating agencies in 

advance of the mid-April beginning of fish operations at the dams. The Council invited public 

comment on the recommendations through April 

20, and then issued its final recommendations on 

April 26. The Council modified its recommendations to address summer spill on June 27 (the 

operating agencies, citing the Council’s recommendations, decided to allow very limited spill in the 

spring and summer).

The Council recommended:

• Full transportation of juvenile salmon and 

steelhead in spring and summer where that 

option is available. This recommendation 

would apply to Lower Granite, Little Goose, 

Lower Monumental and McNary dams, which 

are the only ones with transportation capabilities. The federal agencies should transport 

from McNary in the spring, as well as the 

summer, pending an immediate evaluation of 

the effectiveness of spring transportation from 

that project, except for fish marked for inriver 

studies. The federal agencies should develop 

a study plan for these operations and submit it 

to the Council and the Independent Scientific 

Advisory Board for review.

• Limited spill at John Day, The Dalles and 

Bonneville dams. The Council requests the federal operating agencies and the federal, state and 

tribal fish and wildlife agencies work with the 

Council to develop a plan for when, where and 

how such spill would be provided. The summer 

operating plan should not decrease the currently 

forecast level of electrical reliability and should 

deploy any additional water storage to assure 

the best benefit to fish. The plan should target 

spill to optimize benefits for fish populations 

that are central to the biological objectives in 

the Council’s program that will be adversely 

impacted by changes in the operation of the 

hydrosystem. This includes ESA-listed and 

unlisted populations of spring chinook from 

tributaries above Bonneville Dam, the listed 

Middle Columbia steelhead and Hanford Reach 

fall chinook. Spill at one of these projects would 

be used whenever there are substantial indications that fish passing the project are being 

significantly delayed or harmed by the other 

passage alternatives available at that project, 

provided that the spill can be accomplished in a 

way that maximizes fish benefits and minimizes 

power impacts.

• The Bonneville Power Administration establish 

a mitigation fund from a portion of the revenues 

resulting from decreased spill. In the event there 

also is a reduction in spill authorized for the 

non-federal mid-Columbia projects, the Council 

recommends that a portion of those revenues 

also be designated for this fund. As a first priority, this fund would be used for increasing flows 

in tributaries and the mainstem by encouraging 

1 The Council continued to analyze the biological impacts of reduced spill through the spring and early summer. On April 30, 

the Council issued an analysis focusing on the potential impacts of decreased spring spill at mid-Columbia dams and increased 

smolt transportation at the collector dams. In that analysis, the Council reported that for spring chinook and steelhead, stopping 

summer spill at Mid-Columbia dams would decrease survival by about 10.6 percent, and stopping spill at those dams and the 

federal dams downstream would decrease survival by 14-15 percent. On the other hand, maximizing transportation of smolts at 

McNary Dam and maintaining spills proposed by the federal agencies would increase survival between 10 and 30 percent. The 

Council presented the analysis to federal decisionmakers for use in their deliberations about whether and when to spill.

On June 14, the Council completed another analysis, this one of the effects of summer spill and fish transport on the survival 

of outmigrating juvenile fall chinook. The analysis demonstrated that summer spill has little or no benefit for outmigrating Snake 

River fall chinook because by mid summer most of those fish already have migrated, and most have been collected and transported 

in barges. However, the analysis showed that spill has some benefit to Hanford Reach fall chinook, as more Hanford Reach fish 

remain in the river than Snake River fish because McNary Dam is the only project where Hanford Reach fish can be collected and 

transported. Again, the results of the Council’s analysis were presented to federal decisionmakers.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 18

voluntary reductions in the use of water for irrigation, on a willing-seller basis consistent with 

state and federal law. 2

• At a minimum, the refill of reservoirs to 2000 

Biological Opinion target levels by August 31 

must be a priority to assure future electrical reliability and to preserve the ability to implement 

future fish operations.

• Bonneville should plan and budget for power 

purchases and for continued irrigation buybacks. BPA should be prepared to purchase or 

exchange power to the extent consistent with 

prudent financial planning. Bonneville and 

others should also continue the buyback program from all available commercial sources, 

including irrigated agriculture. These purchases should include instream protection for 

water not pumped, consistent with state and 

federal law. 3

• Bonneville should seek and obtain available 

instream water rights to provide needed flows, 

consistent with state and federal law, on a willing-seller basis.

• The operating agencies should keep the Council 

closely informed on the implementation of these 

recommended operations, including the effectiveness of transportation and the use and effectiveness of spill.

B. A Mainstem Plan for the Columbia River 

Basin Fish and Wildlife Program

In January 2000, the Council began the fifth revision of the Columbia River Basin Fish and Wildlife 

Program since the program initially was adopted 

in November 1982. As with past amendment processes, the program is being revised in phases.

Past versions of the program were criticized by 

scientists for consisting primarily of a number of 

measures that called for specific actions without a 

clear, programwide foundation of scientific principles. The new version of the program, which the 

Council completed in October 2000, expresses goals 

and objectives for the entire basin based on a scientific foundation of ecological principles.

In 2001, the Council began the second phase of 

the program amendment process, a separate plan 

for the mainstem Snake and Columbia rivers. The 

role of the mainstem plan and the Council’s expectations for the elements of that plan are described 

in the 2000 Fish and Wildlife Program, in the section on Basinwide Hydrosystem Strategies and in 

the section entitled Schedule for Further Rulemakings. As described in the program, the mainstem 

plan will contain the specific objectives and action 

measures that the program calls on the federal 

operating agencies and others to implement in the 

mainstem Columbia and Snake rivers, including 

operations of the hydrosystem, to protect, mitigate 

and enhance fish and wildlife affected by the development and operation of the hydroelectric facilities. 

The plan may include, as appropriate, objectives 

and measures for water management, flow regimes, 

spill, reservoir elevations, water retention times, 

adult and juvenile passage modifications at mainstem dams, fish transportation, systemwide coordination, protecting and enhancing mainstem 

spawning and rearing areas and operational requirements to protect resident fish and wildlife. The 

hydrosystem objectives contained in the mainstem 

plan also should provide guidance to the Council’s 

subbasin planning process, establishing for the subbasin planners the expectations of the program for 

mainstem survival of fish that spawn in tributaries 

but rear and migrate through the mainstem. The 

Council will also analyze mainstem recommendations to ensure that the Council adopts objectives 

and measures for mainstem system operations that 

protect, mitigate and enhance fish and wildlife 

while also assuring the region an adequate, effi2 See Bonneville’s comment on this recommendation. Bonneville’s comments begin on Page 26 of this report.

3 Bonneville also comments on this recommendation. See Page 27.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 19

cient, economical and reliable power supply.

The Council requested recommendations for the 

mainstem rule in the spring of 2001 and subsequently received 21 recommendations from a wide 

variety of interests, including state and federal fish 

and wildlife agencies, Indian tribes, electric utility 

associations and interested citizens. These were 

compiled and released for public comment through 

August 1, 2001.

The Council plans to prepare a draft mainstem 

rule for public review and complete the rulemaking 

in 2002.

C. Subbasin Planning

In 2000, the Council restructured the fish and 

wildlife program with a comprehensive, underlying 

framework of general scientific and policy principles that apply to the entire Columbia River Basin. 

In 2001, the Council is moving ahead in developing separate plans for the 62 subbasins of the 

Columbia River Basin. These plans, which will be 

adopted into the program as they are completed, 

will identify needs and provide the basis for 

actions recommended by the Council and funded 

by the Bonneville Power Administration to implement the program.

Like the program itself, each subbasin plan will 

articulate a framework of fundamental elements for 

the mitigation efforts including:

1. A vision, which describes what the plan is trying 

to accomplish with regard to fish and wildlife 

and other desired benefits;

2. Biological objectives, which describe the ecological conditions needed to achieve the vision; and

3. Implementation strategies, procedures and 

guidelines, which guide or describe the actions 

leading to the desired ecological conditions.

In other words, the vision implies biological 

objectives that help establish the strategies. In turn, 

strategies address biological objectives and, ultimately, fulfill the vision. A scientific foundation, 

included as part of the 2000 Program, links the 

components of the program framework, explaining 

why the Council believes certain kinds of management actions will result in particular physical habitat or ecosystem conditions of the basin, or why 

ecosystem conditions will affect fish and wildlife 

populations or communities.

The Council recognizes that the planning process 

involves the participation of local stakeholders who 

will play a lead role in developing subbasin plans, 

and that this will take time to accomplish. Given 

that, a transitional process was established so ongoing projects can be reviewed and funded. Until 

formal subbasin plans are created, interim documents called “subbasin summaries” will be used to 

guide project selection. Summaries are a compilation of all the existing information about a subbasin, 

including past and ongoing fish and wildlife activities, and current management plans, objectives and 

policies. Much of the summary information will help 

to fulfill the inventory component of subbasin plans. 

These summaries will include as much information 

as possible until the more comprehensive plan is 

completed and eventually, the summaries will be 

replaced by subbasin plans.

Subbasin summary development is well underway 

in the 11 provinces. The Inter-Mountain and Columbia Gorge provinces completed subbasin summaries 

in the fall of 2000. Those provinces, along with the 

Mountain Columbia, will be the first three provinces 

to transition into the subbasin planning phase this 

fall and winter. The remaining nine provinces have 

been in various stages of the process throughout 

2001 with the mainstem/systemwide scheduled last 

to begin, in the fall of 2001. 

The Council’s subbasin planning staff developed 

guidance materials to assist subbasin planners. A 

regional workgroup was assembled to create a technical guide for practitioners to use at the local level. 

In addition, a plan overview and a technical outline 

were created as summary documents to describe the 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 20

purpose and elements of a subbasin plan to nontechnical audiences. 

Once the Council had further defined subbasin 

planning elements, it was important to have a timeline for submitting subbasin plans. A schedule was 

developed to provide subbasin planners a target date 

for submitting plans to the Council for review and 

adoption in the program. The schedule is organized 

by province and is largely driven by the province 

review schedule (further described in the next subsection of this annual report). The schedule allows 

the Council one year to review and adopt a plan prior 

to the next project solicitation so that the project 

review is based on the information contained in the 

subbasin plan. 

The overview and technical guidance documents, 

as well as the province review schedule are available 

on the Council’s website, www.nwcouncil.org.

The Council will provide technical assistance 

in developing plans, especially in the assessment 

phase. The coarse-screen data to be used in Ecosystem Diagnosis and Treatment modeling is complete 

for each of the 62 subbasins and can be found 

at www.edthome.org. Council staff will conduct 

workshops in the provinces beginning in the fall 

of 2001 to provide assistance in meeting program 

requirements, completing assessments and coordination with fish and wildlife agencies involved in 

implementing the 2000 Biological Opinion. 

A map of the 11 ecological provinces is below:

Figure 1. Ecological Provinces of the Columbia River Basin (the Columbia River estuary is considered 

the 11th province).
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 21

D. Mitigating the Impact of Hydropower on Fish 

and Wildlife

1. Projects Funded Directly by Bonneville Through 

the Columbia River Basin Fish and Wildlife Program

2001 is the second year of the Council’s transition from an annual review of all projects that 

implement the fish and wildlife program to a rolling, three-year review process in which projects are 

proposed, reviewed and recommended for funding 

within the 11 ecological provinces. The Council has 

committed to address three or four provinces each 

year. Approved projects are funded for three years; 

there is an annual, interim review to ensure progress 

is being made. In this way, the Council’s 11-member Independent Scientific Review Panel, created 

by Congressional direction through a 1996 amendment to the Northwest Power Act, is able to give 

each project a thorough review, including site visits 

where appropriate.

A complete schedule of provincial reviews, 

including those completed to date and those scheduled in the future, is posted on the website of 

the Columbia Basin Fish and Wildlife Authority, 

www.cbfwa.org. 

2. Projects Reimbursed to Federal Agencies by 

Bonneville

Bonneville reimburses the United States Treasury 

for most of the cost of projects to address the 

impacts of construction and operation of federal 

dams in the Columbia Basin. This includes fish 

passage projects, fish propagation and a part of the 

costs allocated to irrigation in the form of irrigation 

assistance. For projects at the dams, Bonneville’s 

reimbursements are equal to the percentage that 

hydropower is an authorized purpose of each dam, 

generally about 75 percent.

The Conference Report to the Fiscal Year 1999 

Energy and Water Development Appropriations Act 

(H.Rept. 105-749) directed the Northwest Power 

Planning Council and its Independent Scientific 

Review Panel to conduct a review of the Columbia 

River Basin fish and wildlife programs that are reimbursed in whole or part by Bonneville. The conferees directed the Panel to complete its review by April 

1 of each year and the Northwest Power Planning 

Council to submit a report to Congress by May 15 

of each year.

The Panel was directed to review the reimbursable programs to determine their consistency with 

the scientific criteria included in section 4(h)(10)(D) 

of the Northwest Power Act as amended in 1996. 

Under that provision, the Council must respond specifically to the recommendations of the Panel. The 

Council interprets its obligations to use the Panel’s 

report as the basis for program funding recommendations to the Congress.

The 1996 amendment to the Power Act did not 

prescribe in detail the process by which the ISRP 

must conduct its review. This flexibility provides an 

opportunity to modify the review to utilize a methodology and sequencing based on ecological provinces. 

Under this approach, the ISRP will review reimbursable projects and programs simultaneously with 

projects funded through the Council’s fish and wildlife program. In 2000, when the province review 

process was initiated with the Columbia Gorge and 

Inter-Mountain provinces, the ISRP chose to refine 

the review process and address reimbursable projects 

as part of those reviews. 

Meanwhile, the ISRP reviewed the federally 

funded Lower Snake River Compensation Program 

hatchery program as part of reviewing projects in 

the Columbia Plateau, Blue Mountain and Mountain 

Snake provinces. 

Also, in December 2001, the ISRP completed 

its review of the Army Corps of Engineers’ reimbursable projects. The Council plans to submit 

its report to Congress on the reimbursable projects 

in early 2002, in time for the Fiscal Year 2003 

appropriations process.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 22

 3. Innovative Projects

On February 7, 2001, the Council approved a 

motion to recommend nine proposals for Bonneville 

funding in Fiscal Year 2001. The total requested 

funding was $1,994,109.

The Council and Bonneville earmarked a total of 

$2 million from the fish and wildlife budget to fund 

innovative projects this year. This funding category 

was designed to extend an open invitation to a broad 

array of sponsors from within and outside the basin 

to submit proposals to explore new methods and 

technologies for fish and wildlife recovery in the 

Columbia River Basin.

A total of 66 proposals were submitted for consideration. The Independent Scientific Review Panel 

reviewed and ranked each of these proposals on 

the basis of their scientific merit, innovative contribution, and potential benefit to fish and wildlife. 

Similarly, the Columbia Basin Fish and Wildlife 

Authority completed a review based on the potential 

application of each proposal to management needs. 

The public also was invited to submit comments 

on the process, proposals, and reviews considered 

under the innovative category. The innovative project solicitation will be conducted annually.

4. High Priority Projects

In the 2000 Fish and Wildlife Program, the 

Council requested Bonneville to solicit “high priority” projects that would bring immediate benefits 

to salmon and steelhead populations listed for protection under the Endangered Species Act. These 

projects, the Council reasoned, should proceed in 

advance of subbasin plans, which will address the 

needs of both listed and nonlisted populations. The 

2000 Program established criteria for the high priority projects, which addressed the off-site mitigation 

requirements of the 2000 Biological Opinion.

Following the solicitation and a review of project 

proposals by the Independent Scientific Review 

Panel on March 26, 2001, the Council recommended 

17 projects totaling $19.3 million to Bonneville for 

funding. 

5. Emergency Hydropower Operations Offset 

(“Action Plan”) Projects

In February, as it became clear that 2001 would 

be an unusually dry year in the Columbia River 

Basin – by summer it was the second-driest in 73 

years of Columbia River recordkeeping – Bonneville declared a power emergency and modified 

or suspended some of the river operations requirements of the 2000 Biological Opinion. Primarily, 

Bonneville reduced or eliminated water spills at 

Snake and Columbia river dams during the spring 

and summer, when juvenile salmon and steelhead 

are migrating to the ocean, in order to reserve water 

in storage reservoirs for hydropower.

To mitigate the impacts of these emergency power 

operations at the dams, Bonneville committed to 

fund an Action Plan of projects that would bring 

immediate benefits to the affected species. Projects 

in the Action Plan, Bonneville announced, would be 

consistent with the Endangered Species Act and the 

Northwest Power Act, and funding for the projects 

would be over and above the other mitigation and 

recovery actions Bonneville plans to implement.

Following Bonneville’s project solicitation and a 

review of the submissions by the Independent Scientific Review Panel, in June and August, 2001, the 

Council recommended a total of 29 projects totaling 

about $29 million for funding. Projects that Bonneville chooses not to fund could be reconsidered in 

the appropriate provincial review process for funding 

through the Council’s fish and wildlife program.

E. Other Fish and Wildlife Initiatives

1. Caspian Tern Relocation

In 2000, the effort to relocate a large nesting 

colony of Caspian terns continued in the Columbia 

River estuary. The tern colony, which nests and rears 

chicks each spring and summer in the estuary, is 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 23

believed to be the largest such colony in the world. 

Unfortunately, the island where the terns preferred 

to nest, Rice Island, is near an area of the estuary 

where young salmon and steelhead acclimate to salt 

water, and these provided a plentiful food source for 

the birds.

The relocation effort began several years ago after 

researchers for the National Marine Fisheries Service and the Columbia River Inter-Tribal Fish Commission demonstrated that the diet of Rice Island 

terns contained a high percentage of salmon and 

steelhead smolts, including endangered species. An 

alternative nesting site was prepared at East Sand 

Island, nine miles downstream, where there are 

fewer salmon and steelhead smolts. The Council is 

helping to finance the relocation effort.

Evidence gathered by researchers in 2001 showed 

that the relocation effort, which involved passive, 

nonlethal means of discouraging the birds from 

nesting on Rice Island, had been successful. No 

terns nested on Rice Island in 2001, and East Sand 

Island was the preferred nesting site for the colony. 

Research also showed that salmon and steelhead 

comprised a much smaller proportion of the diet of 

terns nesting on East Sand Island than had been 

the case on Rice Island, as other fish species, such 

as minnows, are more abundant around East Sand 

Island than are salmon or steelhead. 

In August 2001, as terns were leaving East Sand 

Island and researchers were finishing their work for 

the year and beginning to plan for the 2002 nesting 

season, a federal district court judge in Seattle issued 

a decision in lawsuit that effectively halts all federal 

work on Rice and East Sand islands, such as planting 

grass or building fences to discourage terns from nesting on Rice Island and clearing nesting areas on East 

Sand Island, until the Corps of Engineers prepares 

an environmental impact statement on the relocation 

efforts. The Corps estimates that will take a year. 

The ruling also effectively halts any tern activities 

authorized by the U.S. Fish and Wildlife Service, such 

as collecting tern eggs for research purposes.

Caspian terns are a protected species under the 

Migratory Bird Treaty Act. Plaintiffs had asked the 

judge to order the Corps, which owns East Sand 

Island, to prepare an environmental impact statement 

to demonstrate that the birds are not being harmed.

2. Artificial Production Review Committee

In July 1997, Congress directed the Council, 

with the assistance of the Independent Scientific 

Advisory Board, which advises both the Council and 

the National Marine Fisheries Service, to conduct 

a thorough review of all federally funded artificial 

production programs in the Columbia River Basin. 

Congress directed the Council to recommend, based 

on the report, a coordinated policy for future operation of artificial production programs and how to 

obtain such a policy. 

In its October 1999 report to Congress, the Council stressed that the region needs action and leadership to implement new artificial production policies, 

to decide whether and where to use artificial production, and to ensure that future artificial production 

funding is contingent on reforms being made. These 

decisions need to be made for each subbasin and 

implemented as part of a broader strategy to meet 

regional fish mitigation goals. The Council is incorporating the recommendations of the Artificial Production Review in its amended fish and wildlife 

program, and also has set in motion the needed subbasin planning effort.

To conduct the evaluations of artificial production 

programs – there are approximately 120 in the 

Columbia Basin – the Council created an Artificial 

Production Advisory Committee to assist the Council staff and the independent contractor hired for 

the effort. In August 2001, the Council approved a 

workplan for the evaluations that will:

• Determine whether a program matches its 

stated purpose;

• Evaluate whether a program is consistent with 

legal, policy and scientific criteria;
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 24

• Examine operational costs, production and adult 

return information;

• Recommend interim changes; and

• Develop a preliminary budget/costs to implement the interim changes and determine possible future costs.

The evaluations are expected to take a year. 

From the evaluation reports, a list of issues will be 

prepared and reviewed, recommended changes consistent with the identified issues will be developed, 

and a final list of projects approved by the Artificial 

Production Advisory Committee will be presented 

to the Council in December 2002.

3. Inaugural Annual Report of the Fish and Wildlife 

Program, 1978-2000

In July 1999, the governors of Idaho, Montana, 

Oregon and Washington asked the Northwest Power 

Planning Council to prepare an annual report that 

provides an ongoing accounting and assessment 

of the Bonneville Power Administration’s fish and 

wildlife expenditures. Additionally in their letter, 

the governors requested that the first report summarize, to the degree possible, historical documentation on past expenditures and program successes 

and failures, and that the Council devise a method 

of assessing the impact of funding decisions on the 

basin’s fish and wildlife resources.

The Council completed the inaugural annual 

report in 2001. The report includes:

• A brief history of the Northwest Power Act, the 

Council and the fish and wildlife program;

• An accounting of Bonneville’s fish and wildlife 

expenditures, which are primarily for the purpose of implementing the Council’s program, 

and those Bonneville obligations that result from 

Endangered Species Act requirements;

• Information about fish and wildlife populations 

in the basin that are addressed by the program, 

including salmon and steelhead, resident fish, 

and wildlife.

• A brief discussion of the Council’s current fish 

and wildlife program, which includes amendments for improving data collection and management to increase the public accountability 

for Bonneville’s substantial investment in fish 

and wildlife. 

Bonneville reports its fish and wildlife expenditures as the combined totals of spending on 1) 

the Council’s direct program; 2) federal agency 

expenditures that are reimbursed by Bonneville; 

3) the total repayment of capital investments for 

fish and wildlife projects; and 4) revenue impacts, 

which are the estimated net impacts on Bonneville’s revenue from adjusting dam operations to 

benefit fish.

According to the report, since 1978 Bonneville’s 

fish and wildlife expenditures total $3.48 billion. Of 

this total, approximately 39 percent was attributed to 

hydropower operations generally intended to support 

migrating fish. These costs are calculated based on 

changes in electricity generation caused by altering 

water flows or implementing increased spill at the 

dams. The direct program, for which the Council 

provides more oversight, constitutes approximately 

23 percent of the total Bonneville expenditure. Most 

of the direct program budget is dedicated to habitat 

(42 percent), with significant amounts allocated to 

artificial production (32 percent) and mainstem passage (23 percent). Most of this money is directed 

toward anadromous fish (76 percent), especially 

salmon and steelhead, with the remainder benefiting 

resident fish (12 percent) and wildlife (12 percent). 

Bonneville fish and wildlife expenditures prior to 

1978 are not included in the report.

While the Council reports on Bonneville’s fish 

and wildlife expenditures, the report also notes the 

confusing state of fish and wildlife data collection 

and reporting in the Columbia Basin. The Council 

believes this must improve, and when it does the 

accountability to the public for the Council’s program and Bonneville’s expenditures will improve as 

well by making results more accessible not only to 

specialists, but also to the public at large. Thus, 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 25

this inaugural annual report of the fish and wildlife 

program is an important step in developing even 

higher levels of public understanding about the 

fish and wildlife program, on the one hand, and 

enhanced accountability to the public for Bonneville’s expenditures, on the other.

The report is available on the Council’s website, 

www.nwcouncil.org, as Council Document 2001-02.

PUBLIC INVOLVEMENT

One of the Council’s primary tasks is to fulfill 

the directive of the Northwest Power Act to inform 

and involve Northwest citizens regarding regional 

energy and fish and wildlife issues and the Council’s 

activities. Section 2(3) states a purpose of the 

Act is “to provide for the participation and consultation of the Pacific Northwest states, local governments, consumers, customers, users of the Columbia 

River System (including federal and state fish and 

wildlife agencies and appropriate Indian tribes) and 

the public at large within the region” in the Northwest’s planning for electrical power and protection 

of fish and wildlife resources. Section 4(g)(1) of 

the Act requires the Council to develop “comprehensive programs” to ensure public involvement and 

to “inform the Pacific Northwest public of major 

regional power issues.”

To involve the public, the Council arranges 

consultations and public hearings to discuss and 

explain key issues and also gathers public comments at these meetings and through mail, e-mail 

and telephone contacts. To inform the public, the 

Council produces a newsletter as well as special 

informational materials, media briefings and several 

types of news releases. The Council also regularly 

updates its website (www.nwcouncil.org) and uses 

other approaches to inform interested citizens about 

fish, wildlife and energy issues. The Council conducts all its regular meetings, committee meetings 

and working sessions in public.

FISCAL YEAR 2001 COUNCIL 

BUDGET

In 1997, the Council committed to making 

budget cuts totaling approximately $5.4 million 

over four years, Fiscal Year 1998 through Fiscal 

Year 2001. At that time, it was anticipated that the 

Council’s role would diminish in power planning 

and fish and wildlife program development. It 

was predicted by many that by 2001, electricity 

industry restructuring would be nearly complete 

and federal action on Endangered Species Act listings for salmon would supplant many other fish 

and wildlife actions in the Columbia River Basin. 

Many of the Council’s budget cuts were based on 

these predictions.

Instead, the Council’s role and workload has 

increased substantially. Electricity industry restructuring is far from being fully implemented and, 

as a result, the Council continues to be involved 

in regional issues of power planning and analysis, 

energy system reliability/adequacy and conservation 

resource development. In addition, the Council 

increased its independent scientific and economic 

review of fish and wildlife activities and is amending 

its fish and wildlife program. In short, the Council 

has an enhanced role and new responsibilities for 

fish and wildlife recovery.

Increases in the Council’s revised budget 

reflect re-established conservation analysis capability, increased demand for the Council’s analysis 

of regional power system reliability and adequacy, 

improved fish and wildlife accountability through 

independent scientific review and enhanced fish and 

wildlife planning at the basin, province and subbasin 

levels. Other budget adjustments address program 

support services and inflationary effects of personnel 

service costs.

The Fiscal Year 2002-revised budget of 

$8,339,000 is $562,000 more than the current Fiscal 

Year 2001 budget of $7,777,000. The major 

increases for the Fiscal Year 2002 revised budget 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 26

were in the central and state offices for fish and wildlife, analysis of power system adequacy/reliability, 

energy efficiency and renewable resources. The 

Fiscal Year 2003 draft budget of $8,425,000 reflects 

an increase of $86,000 from the Fiscal Year 2002 

revised budget.

MORE INFORMATION

For additional details about the Northwest 

Power Planning Council’s activities, budget, meetings, comment deadlines, policies or bylaws, 

call 1-800-452-5161 or visit our web site at 

www.nwcouncil.org. Copies of our publications are 

available at the web site or by calling the toll-free 

number above. All Council publications are free.

COMMENTS OF THE BONNEVILLE 

POWER ADMINISTRATION

Comments on power issues (Pages 8-15):

While the Council’s report notes an improvement 

in power supply adequacy for the coming winter 

period, Bonneville remains vigilant. The regional 

transmission grid still suffers from constraints that 

have stressed the reliability of the grid, limited 

access to existing generation, potentially prevented 

the integration of new planned generation and threatened to expose the system to rolling blackouts during 

outages and extreme weather conditions.

Little transmission has been built since 1987. The 

primary constrained paths are the Northern Interconnection, Cross Cascades North, North of John 

Day, West of Hatwai, Cross Cascades South, West of 

McNary, and Northwest to Idaho paths. The Northern Intertie is increasingly constrained because of 

increased generation and the load curtailment associated with the buy-down of industrial load in the 

Puget Sound area.

Operating studies modeling these constraints have 

been performed, and operating procedures that 

include curtailment of firm loads, if necessary, have 

been developed to ensure safe and reliable operations.

Buy-downs of Direct Service Industry (DSI) load 

have a moderate effect on our ability to import power 

into the Northwest from California during outage conditions. This reduction in load also affects transfer 

capability from Montana into Washington. Remedial 

action augmentation of a direct trip signal to a large 

Colstrip (Montana) unit and lower ambient temperatures in the winter should help alleviate constraints.

Bonneville is proceeding with major transmission 

infrastructure additions to alleviate known constraints, integrating new generation and maintaining 

system reliability. As new generation capacity is 

added in the region to keep pace with demand, the 

transmission grid must grow with it in order to be 

able to deliver generation to the loads.

Comments on the Council’s recommendation to 

establish a mitigation fund from a portion of the 

revenues resulting from decreased spill at Snake and 

Columbia River dams in 2001 (Page 17):

Several factors came together to allow the 2001 

Voluntary Load Reduction Program - Columbia 

Basin to be successful. These were (1) low prices 

for crops grown in the Columbia Basin, (2) a drought 

that caused a desperate need for water for hydroelectric generation and (3) high purchased power prices. 

The program was successful this year because Bonneville valued the water for hydroelectric production 

at a high rate, given the high power prices. Also, 

because crop prices were low, irrigators lowered 

their proposed values for those crops. This allowed 

Bonneville to offer a high enough price to irrigators 

to make it financially viable for them to forgo a 

season of irrigation on their crops.

For Bonneville to successfully sponsor another 

such program in upcoming years, the same three 

factors must be present or the program will have 

little success. For 2001, we offered farmers $330 for 

each acre they ceased watering. If the current power 

prices remain stable through next spring, Bonneville 

would not have incentive to offer as high a price next 

year. Further, crop prices have generally increased 
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 27

over the course of this year. Thus, it is doubtful 

whether Bonneville and irrigators could agree on 

a price for such a program next year. Bonneville 

expended approximately $30 million on the VLRColumbia Basin program in 2001.

Comments on the Council’s recommendation that 

Bonneville should continue purchasing water from 

all available commercial sources, including irrigated agriculture, and that these purchases should 

include instream protection for water not pumped, 

consistent with state and federal law (Page 17):

The Council recommended that Bonneville 

“include in-stream protection for water not 

pumped.” This is impracticable to a large extent. 

Water pumped from Banks Lake to supply water 

to Columbia Basin irrigators is covered by water 

rights held by the Bureau of Reclamation. These 

water rights also cover the generation of power at 

Grand Coulee. Thus, if water is not diverted for 

irrigation, the water is still “used” under the permit 

for power generation. Once the water is “used” 

under the water right, Reclamation has no control 

over downstream water uses. Given the level of 

diversions below Grand Coulee, Bonneville can 

be reasonably sure that the VELR program saved 

water will also travel through generators at Chief 

Joseph Dam, but given the large number of diversions downstream from Chief Joseph, it would be 

difficult to assess the amount of power the VELR 

program water generates farther down stream.

In 2001, Bonneville signed an acknowledgement 

with Washington Department of Ecology (WDOE) 

recognizing that they intended to use a certain 

amount of water from the Columbia River to provide water to irrigators with interruptible water 

rights downstream from Chief Joseph. Bonneville 

explained to WDOE that neither Bonneville nor 

Reclamation had rights to this water, but that we 

could deem the increase in flow from the Columbia 

River a result of the VELR-Columbia Basin program. Normally we would have anticipated this 

water to otherwise travel downstream to other federal hydroelectric projects, so WDOE compensated 

Bonneville for this anticipated loss in downstream 

generation. However, no one could be sure of the 

final destination of any specific molecule of water 

“saved” from the Grand Coulee irrigation diversion.
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 28

(Insert Letter from Bonneville Here)
Annual Report of the Pacific Northwest Electric Power and Conservation Planning Council 29

IDAHO MONTANA

Judi Danielson Ed Bartlett

Jim Kempton Leo Giacometto

450 W. State (UPS and DHL only) Capitol Station

Box 83720 Helena, Montana 59620-0805

Boise, Idaho 83720-0062 Telephone: 406-444-3952

Telephone: 208-334-6970 Fax: 406-444-4339

Fax: 208-334-2112

OREGON WASHINGTON

Eric Bloch, Vice Chair Frank L. “Larry” Cassidy, Jr., Chair

851 S.W. Sixth Avenue, Suite 1020 Vancouver:

Portland, Oregon 97204 c/o Flo-Rite Products

Telephone: 503-229-5171 P.O. Box 2187

Fax: 503-229-5173 Vancouver, WA 98668

Telephone: 360-693-6951 Fax: 360-699-4093

John Brogoitti Tom Karier

Northwest Power Planning Council W. 705 First Avenue, MS-1

11 S.W. Byers Avenue Spokane, WA 99201-3909

Pendleton, Oregon 97801 Telephone: 509-623-4386

Telephone: 541-276-0657 

Fax: 541-276-0995 Olympia office:

Fax: 509-623-4380 Telephone: 360-902-2302 or 2306

Fax: 360-902-2319

1111 Washington St. SE, 5th Floor

Mail Stop 43200

Olympia, WA, 98501-1091

CENTRAL OFFICE Executive Director: Steve Crow

851 S.W. Sixth Avenue, Suite 1100 Power Division Director: Dick Watson

Portland, Oregon 97204 Fish and Wildlife Director: Doug Marker

Telephone: 503-222-5161 Public Affairs Director: Mark Walker

Fax: 503-820-2370 General Counsel: John Shurts

Toll Free: 1-800-452-5161 Administrative Officer: Jim Tanner

COUNCIL MEMBERS AND OFFICES
851 S.W. Sixth Avenue

Suite 1100

Portland, Oregon 97204

Telephone: 503-222-5161

Toll free: 800-452-5161

Web site: www.nwcouncil.org