BPA inches closer to Provider of Choice contracts for post-2028

The Bonneville Power Administration released its Provider of Choice Concept Paper on July 14, kicking off the policy development phase of this important regional process. 

Provider of Choice is BPA’s effort to establish the long-term preference power sales policy and agreements that will go into effect in 2028. That’s the year current Regional Dialogue contracts expire. By statute, BPA must offer contracts for the sale of federal power at the request of regional preference customers. Law limits BPA to a maximum 20-year contract term inclusive of any revisions, extensions or renewals. 

“BPA is committed to remaining the region’s low-cost power provider beyond 2028,” said Administrator John Hairston. “The Provider of Choice Concept Paper reflects a major milestone in Bonneville’s efforts to develop the products, services, policies and rate structure to help us achieve that goal.” 

Based on feedback from customers that the current power sales agreements generally work well, the Provider of Choice Concept Paper maintains key elements of current contracts. BPA proposes to build off of the existing Regional Dialogue contracts, including maintaining the tiered rate and Contract High Water Mark constructs. BPA also proposes to offer the Load Following, Slice and Slice/Block product options with critical updates, introducing these concepts as a starting point for future product discussions. With the concept paper, BPA describes its flexibilities and receptiveness to product adjustments and new products to help customers meet their needs in the rapidly changing energy industry. 

“We’re developing new contracts against a highly dynamic backdrop of energy-related issues that have potential to impact future agreements,” says Kim Thompson, vice president of Northwest Requirements Marking. “Throughout this process, we’ve worked hard to assess customer positions in the areas of capacity, carbon and many other policy arenas. With the concept paper as a starting point, I look forward to policy discussions starting this summer.” 

Bonneville will now hold a set of meetings to gather stakeholder feedback on the concepts and elements introduced in its paper. The first workshop is scheduled for Tuesday, July 21. A series of policy meetings will continue throughout the remainder of FY 2022 and into FY 2023. These ongoing public workshops will inform policy development and provide opportunities for customer input, questions and comments.

Provider of Choice is just one of the major processes under the Post-2028 Initiative. Other efforts under this umbrella include the Residential Exchange Program, development of the subsequent rate design (rate methodology), and conservation (energy efficiency).

More information on Provider of Choice can be found at Provider of Choice.