CONSERVATION IS OFTEN claimed to be the biggest and cheapest source of energy for the near future. But this has been largely a hypothetical claim, and it remains much easier for most people to see how a power plant, say, can provide energy than to calculate comparable benefits from conservation programs ranging from home insulation to peak load pricing to industrial cogeneration. Somehow these don't seem as real or dependable, even if together they would save as much energy as a new plant would produce.

Now two studies of a proposed new power plant system make it easier to see how conservation versus production can be weighed. The proposal by two California utilities is to build a large new coal project consisting of two power plants, a strip mine near Bryce Canyon National Park, a water project, and a coal slurry transportation pipeline. According to a study by the Environmental Defense Fund, and to a draft environmental impact statement from the Interior Department's Bureau of Land Management, a collection of energy alternatives -- including increased efficiency in home, business and farm use of electricity and increased development of geothermal, cogeneration, wind and biomass -- could produce more energy than the proposed new system.

Interior's document marks the first time a federal agency has considered a specific, named and numbered list of conservation and alternative energy sources and found them to be "a reasonable and technically feasible" substitute for a new central power plant. The draft statement finds that the alternatives could supply not only the 2,500 megawatts of the proposed system, but an additional 4,000 megawatts.

The Environmental Defense Fund's study also compared the likely costs. It claimed that the same list of conservation and alternative energy technologies would cost the California utilities' ratepayers half a billion dollars less than the utilities' proposed new project, and would offer financial advantages to the utilities' shareholders as well.

Now, all of this remains to be argued over, the assertions tested and proved out. Hearings by the California Public Utilities Commission this summer, and the concurrent review and criticism of Interior's impact statement, may discover flaws in the dramatic findings of these two studies. But at a minimum, the issue is still open, and that gives another element of the story an ironic twist: the Allen-Warner Valley energy system, as the proposed project is known, had been first on the administration's list of "national priority" energy projects that were to have been rushed through, unquestioned, by the ill-conceived Energy Mobilization Board -- which Congress, mercifully, killed.