The Trump administration is proposing to sell the Bonneville Power Administration’s transmission assets, despite previous assurances from some administration officials that it would be left alone.
The proposed sale was included in the White House’s plan to substantially overhaul much of the federal government. The plan, titled, “Delivering Government Solutions in the 21st Century: Reform Plan and Reorganization Recommendations,” was released late last month.
The 128-page document claims selling the federally owned transmission assets of the Tennessee Valley Authority and the Power Marketing Administrations, including the BPA, Southwestern Power Administration and Western Area Power Administration, would “encourage a more efficient allocation of economic resources and mitigate unnecessary risk to taxpayers.”
“The Federal Government’s role in owning and operating transmission assets creates unnecessary risk for taxpayers and distorts private markets that are better equipped to carry out this function,” the plan reads. “Ownership of transmission assets is best carried out by the private sector, where there are appropriate market and regulatory incentives.”
The BPA operates 75 percent of the high-power electrical grid across 300,000 square miles.
Its more than 15,000 miles of power lines and nearly 300 substations serve around 12 million customers in the region.
The plan argues that “a strong justification no longer exists” for the federal government to operate transmission systems.
Private ownership, it claims, could make operations more efficient and spur more infrastructure improvements, “while reducing the subsidies (both implicit and explicit) that the federal government now provides to the respective regions’ ratepayers.”
The administration claims selling federal transmission assets would save $9.5 billion over 10 years.
“They have provided no detail at all supporting that,” said Fred Heutte of the NW Energy Coalition, an alliance of close to 100 environmental, civic, and human service organizations, progressive utilities, and businesses in Oregon, Washington, Idaho, Montana and British Columbia. “Ultimately, it’s not a net gain to the taxpayer, and for the Northwest ratepayers it would be a rate upshot. … It would just raise costs. There’s no question about that at all.”
BPA is self-funded, though its operation relies heavily on borrowing from the U.S. Treasury.
However, Heutte said it has consistently made its payments for more than three decades.
“It just looks like some people back in D.C. who’ve long-decided privatization is the solution to everything,” he said. “What is the problem this proposal is trying to solve? … It would be very bad for our regional economy.”
Rep. Jaime Herrera Beutler, R-Battle Ground, described the administration’s proposal as “disappointing.”
“It contradicts what we were told by Department of Energy staff, and is inconsistent with Secretary Perry’s testimony in a Congressional hearing,” her office said in a statement to The Columbian. “Any divestiture of BPA assets would have to be approved by Congress, and I will continue working with a united Northwest Congressional delegation to ensure it doesn’t happen.”
In late May, Herrera Beutler, Cathy McMorris Rodgers, R-Spokane, Dan Newhouse, R-Yakima, and Dave Reichert, R-Auburn, issued a joint statement announcing the U.S. Department of Energy assured them it would not sell the BPA’s assets.
About a month prior, during congressional testimony, Energy Secretary Rick Perry said BPA assets wouldn’t be sold, unless Congress explicitly authorized a sale.
On June 26, while the Senate Energy and Natural Resources Committee questioned Trump administration nominees for the Department of Energy, Sen. Maria Cantwell, D-Wash., took time to denounce the proposed sale.
“I also intend to continue to pursue making sure all our colleagues at DOE understand the very terrible idea the administration is putting forward in trying to sell off assets from the (BPA) and TVA,” Cantwell said during the hearing.
Last year, 15 congressional representatives from the Pacific Northwest sent a letter to Perry and Office of Management and Budget Director Mick Mulvaney decrying a proposal in Trump’s budget to sell off BPA’s assets.
Trump’s administration has proposed selling federal transmission assets two other times since coming into office.
His is only the latest of several administrations that have proposed selling all or part of the BPA.
The Reagan, Clinton and George W. Bush administrations all made similar proposals, over the objections of previous Northwest congressional delegations.