Northwest Power Alliance Wages Radio War Against Bpa ( May 26, 2001 )

At times, it seems, Bonneville Power Administration officials can't make any decision - save, maybe, where to go for lunch - that doesn't upset somebody in the Northwest enough to spend a bunch of money on ads whacking the federal agency.

Such has been the case recently as the aluminum industry, in the guise of the Northwest Power Alliance, fights to get lots of power at cheap prices beginning this fall.

The federal power marketing agency has allocated half as much electricity to the industry as it once enjoyed, and at prices that could be two or three times higher than they now are.

At current rates, most of the plants are marginal at best. With higher power rates, they couldn't come close to operating profitably.

Bonneville's policies are costing the region 30,000 jobs, claim the industry's ads, which have been playing on radio stations in Seattle, Portland, Spokane and Boise.

That figure is debatable at best - the industry only employed 10,000 in its best years, and the alliance's ads don't point out that the total figure includes indirect jobs supposedly lost because unemployed smelter workers don't have cash to buy the goods and services others supply.

Bonneville can't fight back publicly, but the Public Power Council, an association of 120 or so public utilities in the region, has.

The council is running its own ads claiming that tens of thousands of jobs more will be lost if Bonneville caves in to the aluminum industry.

"No special deals," those ads shout.

The alliance, in response, hired its own economist to challenge the flawed logic of the council's informal, unscientific study.

The study "is the digital equivalent of a back-of-the-envelope" survey, said former Seattle newsman John Arthur Wilson, now a spokesman for the alliance.

Ed Mosey, a Bonneville spokesman who has been on both sides of these fights in the past, is bemused by the claims and counter claims.

"There's a war going on," he said the other day. "To me, they're just part of the game."

But the ads are getting to Steve Wright, who was happily minding Bonneville's Washington, D.C., lobbying store until he was posted back to Portland and became the agency's acting administrator shortly after the West Coast energy crisis began.

"He's said, 'Maybe we can include it in their contracts that they stop running those ads,'" Mosey said.

"They're irritating to executives around here."

The reality is that companies like Kaiser Aluminum are making more money selling their power allocations to today's high-priced wholesale energy markets than they ever would making metal.

Kaiser reported power sales revenues of something like $228 million in the first three months of this year alone.

The industry has also suggested that Bonneville adopt a tiered system of rates where past customers would get a base load at the cheap cost of hydroelectric power, and anything over the base would cost the price on the currently inflated wholesale market.

The impact - not surprisingly - would be to give a special deal to aluminum companies while dramatically raising rates to utilities like Tacoma Power, which will increase its dependence on Bonneville to nearly 60 percent this fall, from a prior low of about 12 percent.

Although it's probably unfair to quantify the difference, utilities in the Northwest clearly make possible hundreds of times more jobs than nine or 10 aluminum mills.

The aluminum companies "are being unrealistic and their criticism of Bonneville is unfair," said Tacoma's utilities director Mark Crisson, who himself once worked for an aluminum company and for the association of direct Bonneville customers called the DSIs.

"I wonder if some of this isn't just disingenuous on their part," Crisson said. "Some of it's just positioning for an exit" from the Northwest industrial economy entirely.

The demise of the Northwest aluminum industry is a very real possibility. About one-third of the cost of producing metal for beer cans and Boeing jets is electricity.

The region's plants, for the most part, are 40 or 50 years old, and very few companies have invested much in new technology. Why should they, when they can move to new plants offshore where the governments of developing nations are more than willing to invest in cheap energy production in return for lots of low-paying jobs?

The alliance's radio ads are set to end soon.

But the issues - that have divided major participants in the Northwest's energy economy for decades - will continue with no end in sight.

Stay tuned.

http://199.97.97.163/IMDS%PMANAT0%read%/home/content/users/imds/feeds/bellsuper/2001/05/26/TCMA/0000-0566-KEYWORD.Missing

-- Martin Thompson (mthom1927@aol.com), May 26, 2001