1997 Biennial
Energy Report

Our Energy Future: At a Crossroads

Message from the Director

I am pleased to submit the 1997 Biennial Report for energy, a field in which we are likely to witness major policy initiatives at the state and federal level this year. In this report, the Department of Community, Trade and Economic Development (CTED) provides you with information and background on the most pressing energy issues affecting the state of Washington. We focus in particular on those areas most likely to be the subjects of legislative action in the 1997 session. This will not exhaust the list of potentially important issues, but it should provide an introduction to the hottest topics.

Two crucial state energy functions were transferred to CTED with the closure of the Washington State Energy Office on June 30, 1996. CTED's new Energy Service Area houses the Energy Policy Group and the Energy Facility Site Evaluation Council (EFSEC), with Mr. K.C. Golden as the Assistant Director. These energy functions complement CTED's other service areas, especially Growth Management, Housing, Local Development Assistance, and Trade and Economic Sectors. The addition of the Energy Service Area affirms the critical role that reliable, affordable, environmentally sound energy service plays in the development of our state. Energy is one area where the linkage between good economic policy and sound environmental policy is particularly compelling.

We welcome the opportunity to forge strong working partnerships with the other state entities that will be implementing important energy functions: the Washington State University Cooperative Extension Energy Program, the Department of General Administration, and the Department of Transportation. Washington's energy policy goals reinforce and are reinforced by the essential programmatic work of these other agencies.

The winds of change are resounding throughout the electric power and utility industry. As this report is being written, the Steering Committee of the Governor's Comprehensive Review of the Northwest Energy System is finishing its recommendations for far-reaching changes to our prized electric power system. While many of these changes are controversial, clearly the status quo is not one of our options for the future. Without concerted action by the Northwest states, we are likely to lose the benefits of the Columbia River System in a competitive wholesale power market that knows no state or regional bounds.

The economic and environmental significance of these changes in our power system can hardly be overstated. The natural and human-engineered productivity of the Columbia River System is one of this state's greatest assets. Through our own actions as a state, and in cooperation with the other Northwest states, we must agree on a set of policies that will sustain and enhance the value of this system for future generations of Northwesterners. Our low-cost power, Columbia Basin salmon runs, and the reliability of our power system hang in the balance.

We look forward to working with you as these exciting developments in the energy field unfold. If you have questions on the contents of this report or other energy matters, please contact K.C. Golden or other EFSEC or Energy Policy Staff listed in Appendix G of this report.

Mike Fitzgerald
Director