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EXHIBIT I

CORRESPONDENCE BETWEEN SENATOR FRANK CHURCH AND BONNEVILLE POWER ADMINISTRATION IN REGARD TO COORDINATION AGREEMENT

Dr. WILLIAM A. PEARL,

UNITED STATES SENATE,

Administrator, Bonneville Power Administration,

Portland, Oreg.

September 18, 1957.

DEAR DR. PEARL: There has come to my attention the fact that the Bonneville Power Administration is negotiating with the Idaho Power Co. for interchange and exchange of power at the time the Brownlee Dam goes into production.

I would appreciate being advised of the status of the negotiations and the proposals of each of the parties presently being considered by the other party. I would also appreciate being advised as to the review procedures that exist with reference to this type of negotiation-that is, does the Interior Department have any responsibility for the carrying on of negotiations or for approval of the proposals agreed to by the Bonneville Power Administration and the Idaho Power Co.?

I understand that the Bonneville Power Administration sells power to the Idaho Power Co. at the present time. I would like to have the general summary of the terms and conditions of this marketing and an analysis of the power furnished by season or month for at least the last 3 years by both parties. If you have the information, I would like to know how much seasonal surplus capacity exists in southern Idaho in the Idaho Power system at the present time, and how much surplus power is available for importation into Idaho from the Federal Columbia River power system?

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as to the type or types of arrangement which, in my opinion, would be acceptable to the Government. Obviously such a decision must precede a determination as to the exact terms and conditions of the arrangement. Both the general type of arrangement and the terms and conditions thereof will be affirmed as to legality by my counsel before the proposal stage is reached. For these reasons, at this point it appears that it will be some time before we are able to reach a sufficient stage of definiteness in our thinking to warrant a review.

It has been my plan to thoroughly discuss all proposed arrangements of importance with our customers, customer associations, and other interested groups (such as those represented by the membership of the Administration's Regional Advisory Council), prior to making a final decision. Integration with the Idaho Power Co.'s new plants is a matter of regional importance, and this review procedure will be followed. In fact, a status report on this matter has already been placed on the agenda for our forthcoming customer and Advisory Council meetings (scheduled for November). The Bureau of Reclamation, the Federal Power Commission, and the Corps of Engineers are being consulted. On matters of importance such as this, we work with the Secretariat and Solicitor's office of the Department. Legal analyses are currently underway.

I have given a similar status report to Senator Morse, who also inquired on this matter.

The Bonneville Power Administration exchanges power with the Idaho Power Co. under an exchange agreement executed March 4, 1955. This contract expires August 31, 1974. Either party, however, may cancel it upon 3 years' notice, but not prior to August 31, 1960.

This contract is the usual exchange arrangement between Bonneville and a distributor. It provides for mutual exchange of hydro energy. It also provides, in case of an emergency, for delivery to the Government of steam-generated energy which Idaho might be able to procure. In addition to the usual exchange arrangements, the contract includes a provision for delivery by the Government of up to 100 million kilowatt-hours of provisional power which may be delivered from the time the Government system goes on control until September 30 of each year. This provisional power must be returned if the Administration finds such to be necessary to carry any other loads in its normal service area, including interruptible industrial loads.

All accounts are settled at the H rate of 21⁄2 mills per kilowatt-hour.

Deliveries started in May 1955. These deliveries, by months, are shown in the attached table. Bonneville has delivered a net of over 211 million kilowatthours to the Idaho Power Co., which represents revenue to the Government of over $500,000.

The attached table also shows the amount of secondary energy which is presently unallocated on the Federal system for the period July 1957 through June 1958, and which may be assumed to be available for Idaho. You will note that the amounts are considerably larger under median month hydrologic conditions than they are under minimum conditions.

Our information indicates that the Idaho Power Co. will face a power deficiency on its system, rather than a surplus, during the 1957-58 year. This deficiency may be met by the company either by purchases from other members of the eastern group of the pool, or by utilization of our surplus, to the extent we can supply it. During October we will be in Washington, D. C., to present our 1959 budget request to the Bureau of the Budget, and I would appreciate the opportunity at that time of discussing with you the methods we have been studying to accomplish the requirements of the Idaho Power Co.'s license and also obtain the maximum generation from the projects in the Northwest.

Sincerely yours,

WM. A. PEARL, Administrator.

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EXHIBIT II

ORDER OF FEDERAL POWER COMMISSION LICENSING IDAHO POWER CO. TO BUILD SNAKE RIVER DAMS

UNITED STATES OF AMERICA, FEDERAL POWER COMMISSION

Before Jerome K. Kuykendall, Chairman; Claude L. Draper, Commissioners: Seaborn L. Digby, Frederick Stueck, and William R. Connole.

In the Matters of Idaho Power Company, Projects Nos. 1971, 2132, and 2133

ORDER ISSUING LICENSE (MAJOR)

Application was filed December 15, 1950, by Idaho Power Company, of Boise, Idaho, for a license under the Federal Power Act for a proposed hydroelectric development, known as Oxbow, and designated as Project No. 1971, to be located on Snake River in Idaho and Oregon, and on May 15, 1953, the Company filed applications for licenses for two additional proposed hydroelectric developments on Snake River, known as low Hells Canyon and Brownlee, and designated Projects Nos. 2132 and 2133, respectively. The proposed developments would be located in Adams and Washington Counties, Idaho, and in Wallowa, Baker, and Malheur Counties, Oregon. The applications were supplemented by later filings.

Public hearings were held on the Oxbox application (No. 1971) during July 1952, in Baker, Oregon, and Boise, Idaho, respectively, at which all persons desiring to speak either in favor of or against the issuance of a license were heard. After the filing of the applications for low Hells Canyon (No. 2132) and Brownlee (No. 2133), the proceedings upon the three applications were consolidated for purposes of public hearing. A further public hearing was held in Washington, D. C., commencing on July 7, 1953, in which hearing all parties, including the Applicant, the staff of the Commission, as well as the National Hells Canyon Association, Inc., Lewis County Public Utility District of Washington, et al., National Rural Electric Cooperative Association, the State of Washington and other parties participated, and presented testimony and documentary exhibits. After the close of the hearing, briefs were filed by the various parties and by the staff and an initial decision was rendered by the Presiding Examiner containing findings and conclusions. On July 6, 1955, the Commission heard oral argument on the exceptions to the Examiner's decision.

For the reasons set forth in Opinion No. 283 adopted this date and made a part hereof by reference, and upon consideration of the entire record in these matters, including the reports of the Federal and State agencies, protests from interested citizens, the briefs of the parties and the staff filed in connection therewith, the Examiner's decision, and the oral argument thereon, the Commission finds:

(1) The Brownlee, Oxbow and low Hells Canyon developments proposed by Applicant in the Hells Canyon reach of Snake River would occupy lands of the United States.

(2) The Snake River from its junction with the Columbia River up to the mouth of Henrys Fork is a navigable water of the United States.

(3) The proposed Brownlee, Oxbow and low Hells Canyon developments that would be constructed by Applicant would be located in and along a navigable water of the United States; and they would otherwise affect the interests of interstate or foreign commerce by affecting the downstream navigable capacity of the river.

(4) Under the provisions of Section 23 (b) of the Federal Power Act, the Applicant may not construct, operate or maintain any project or part thereof in Hells Canyon reach of Snake River until a license shall have been obtained therefor pursuant to this Act.

(5) The proposed project consists of:

(a) All lands constituting the project area and enclosed by the project boundary or the limits of which are otherwise defined, and/or interest in such lands necessary or appropriate for the purposes of the project, whether such lands or interest therein are owned or held by the applicant or by the United States; the general location of such project area being shown and described by certain exhibits which formed part of the application for license and which are designated and described as follows:

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(b) All project works consisting of

(1) The proposed Brownlee development, to consist of a rockfill dam having a maximum height of 395 feet and a crest length of 1,320 feet at elevation 2090 feet in the Snake River at river mile 284.6, and a concrete spillway section surmounted by tainter gates, creating a reservoir with a usable storage capacity of 1,000,000 acre-feet at a drawdown of 101 feet below elevation 2077 feet; a controlled intake, power tunnel and penstocks leading to a powerhouse containing initially four turbines each rated at 139,000 horsepower and connected to a 90,100 kilowatt generator operating under a gross static head of 277 feet, with provisions for an additional intake and tunnel and the future installation of two similar units in an extension to the powerhouse; and transmission facilities;

(2) The proposed Oxbow development, to consist of a rockfill dam having a maximum height of 205 feet and a credit length of 725 feet at elevation 1810 feet in the Snake River at river mile 273.2 and a concrete spillway section surmounted by tainter gates, creating a reservoir with a usable storage capacity of 6,200 acre-feet at a drawdown of 5 feet below elevation 1800 feet; a canal, tunnel and penstocks across the Oxbow; a powerhouse containing initially four turbines each rated at 58,000 horsepower and connected to a 37,750 kilowatt generator operating under a gross static head of 117 feet, with provisions for an additional tunnel and the future installation of two similar units in an extension to the powerhouse; and transmission facilities; and

(3) The proposed low Hells Canyon development, to consist of a rockfill dam having a maximum height of 320 feet and a crest length of 860 feet at elevation 1696 feet in the Snake River at river mile 247.5 and a concrete spillway section surmounted by tainter gates, creating a reservoir with a usable storage capacity of 11,200 acre-feet at a drawndown of 5 feet below elevation 1683 feet; an intake and power tunnel and penstocks leading to a powerhouse; a powerhouse containing initially five turbines each rated at 84,000 horsepower and connected to a 54,400 kilowatt generator operating under a gross static head of 208 feet, with provisions for an additional tunnel and intake and the future installation of two turbines each rated at 105,000 horsepower and connected to a 68,000 kilowatt generator in an extension to the powerhouse; and transmission facilities; the location, nature, and character of which are more specifically shown and described by the exhibits heretofore cited and by other exhibits which also formed part of the application for license and which are designated and described as follows:

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