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EMD-80-57 1 (1980-02-06)

handle is hein.gao/gaobabaff0001 and id is 1 raw text is: I ttAA UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 February 6, 1980 ZNROY AND MINOAi DIVIION B-114858 House ' of IIIesenlaivel01115lrll~ll00 11 The Honorable Jim Weaver Ho use of Representatives - - - - . . .. .: - 111500 Dear Mr. Weaver: Subject: TAdministrative Feasibility of Two-Tiered AecL_ Pricing by the Bonneville Power Adminis-°°04'i6 trationl(EMD-80-57) Your September 13, 1979, letter requested that we assess the administrative feasibility of a two-tier rate structure for electric power marketed by the Bonneville Power Admin- istration (BPA), as proposed in section 9(b) of H.R. 4159 and identify any utility that is using a tiered pricing system. The stated purpose of such a rate structure is to motivate electric utilities and power consumers to conserve electricity and develop renewable resources. As agreed with your staff, we did not study power pricing methodologies in depth. Our efforts were essentially limited to an analysis of the two-tier concept and discussions with Bonneville officials. We also made some limited telephone contacts with utility officials in other areas of the United States. In summary, we found that: --There is general support, including dupport from Bonneville,. for motivating electric utilities and retail customers to conserve power and to develop renewable energy sources. --Tiered rate pricing would provide utility customers with more accurate price signals than they presently receive under Bonneville's melded rate. --Tiered rate pricing can be made administratively workable at the wholesale level, but there are questions of application about what specific form such rates should take at the retail level in order to assure equity and effectiveness. (008940)