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News Release
 
PacifiCorp Sale Approved by Commission
 
February 24, 2006 (2006 - 002) (UM 1209)
 
Contacts:  Lee Beyer, Chairman, 503 378-6611; Ray Baum, Commissioner, 503 378-6611; John Savage, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
 
Salem, OR –Today the Oregon Public Utility Commission (OPUC) approved a sale of PacifiCorp from Scottish Power to MidAmerican Energy Holding Company (MEHC) for $9.4 billion.
 
PacifiCorp, with 535,000 customers in Oregon, is the state’s second-largest regulated utility.  The company provides electrical service to customers in six states.
 
After a thorough examination of the proposed sale, the Commission found that the transaction provided benefits for customers and is in the public interest.
 
“When viewed in total this is a good deal for ratepayers due to the combination of financial ring-fencing, certain guaranteed cost cuts, commitments for renewable energy, and low-income energy assistance,” Commission Chairman Lee Beyer said. “In addition to these benefits, MidAmerican pledged that PacifiCorp’s corporate headquarters would remain in Portland and that senior management in Portland will continue to make decisions on Oregon-related issues.”
 
By law the Commission cannot approve a sale unless it finds the transaction is in the public interest and provides a net benefit for ratepayers.
 
The sale was scrutinized by a wide variety of  parties including advocates for residential and industrial users, renewable energy proponents, and Native American Indian tribes, who signed a stipulation endorsing the sale.
 
MidAmerican is based in Des Moines, Iowa. Its largest shareholder is Warren Buffett. Buffet provided a sworn statement that he will not directly or indirectly exercise control over PacifiCorp.
 
The $9.4 billion deal includes $5.1 billion in cash plus approximately $4.3 billion in debt.
 
In the stipulation, the company committed to:
 
  • $140 million company-wide rate credit to mitigate harms and provide customer benefits, $40 million of which is Oregon’s share;

  • Isolate the utility from the holding company (termed ring-fencing) to protect PacifiCorp from financial harm;

  • Keep PacifiCorp headquarters in Portland;

  • Provide $400,000 per year for five years to low-income energy assistance programs;

  • Extend customer service guarantees and performance standards;

  • Acquire 400 MW of renewable energy by 2008 and file a plan to develop an additional 1400 MW by 2015 if cost effective;

  • Provide access to books and records of PacifiCorp, MEHC and Berkshire Hathaway.
 
Previously the sale was approved by the public utility commissions of Utah, Idaho, Washington, Wyoming and California.
 
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