Avista merger concerns roll in

By BRIAN WALKER

Staff Writer

COEUR d'ALENE — Concerns over Avista Utilities' proposed merger with Toronto-based Hydro One Limited have been far from lights out.

"We've received 280 comments — almost all in opposition," said Matt Evans, public information officer with the Idaho Public Utilities Commission. IPUC will hold a public hearing on the proposal on Thursday at the Midtown Meeting Center, 1505 N. Fifth St., Coeur d'Alene, at 6 p.m.

"There has been a lot of interest in this case in terms of public comments submitted, and the comments are still coming in steadily, so we expect hearty turnout. The majority of those in opposition cite foreign ownership as a factor in their stance."

Comments will be accepted through June 20. IPUC is expected to make a decision on the proposal by Aug. 14.

Utility commissions in both Idaho and Washington must approve the merger proposal for it to become reality.

The proposal calls for Avista to become a wholly owned subsidiary of Hydro One, the largest electric utility in the province of Ontario.

Avista provides electrical service to about 378,000 customers in the Northwest and 342,000 natural gas customers. In North Idaho, it serves 130,000 with electricity and 82,000 with natural gas. Hydro One provides electric service to more than 1.3 million customers.

The transaction would create one of the largest regulated utilities in North America with more than $25.4 billion in assets.

Lorah Sue Skerrett, of Coeur d'Alene, is among those who have concerns over the proposal.

"I do not want Avista affected or controlled by a company headquartered in a foreign country — Canada or anywhere," she wrote. "Canada is a member of the Paris Climate Accord, which can result in Canadian companies having to shoulder oppressive financial burdens. Canada's power-producing industry may be headed for a crisis. I do not want Avista to be affected by that."

But Casey Fielder, Avista's communications manager, said Avista believes the proposed merger will be beneficial for its customers and stakeholders.

"After the transaction closes, Avista will continue to operate as a stand-alone company under the same name, from the same headquarters in Spokane, with the same employees, same management team, overseen by a board of directors with significant Pacific Northwest representation and with the same levels of high quality service for customers," Fielder said. "Avista will continue to run the business and serve customers and communities as it always has with local decision-making authority."

It will also continue to manage all operations of the utility and comply with federal regulation under the Federal Energy Regulatory Commission (FERC) and the North American Electric Reliability Corporation, Fielder said.

Fielder said customers will continue to see the same level of regulatory oversight by the utility commissions in each state.

"This means that the commissions will continue to set the rates Avista customers pay for their energy," she said.

Receiving service from a larger utility would allow Avista customers to "receive the benefits of scale … while also avoiding the risk of a potential subsequent acquisition by another party that may not share Avista's culture and values," the companies' application states. The company's purchasing power would increase, while legal, accounting, technology and research costs would decrease, the application states.

The proposed settlement agreement calls for $15.8 million in rate credits for Idaho customers over the next five years and more than $5 million in funding for energy efficiency, conservation and low-income programs.

Rathdrum's Anne Albrecht said she believes the proposal is a "money grab by a powerful company."

"Greed hurts those on fixed incomes," she wrote.

IPUC’s Evans said rates will not go up if the merger is approved. In fact, he said, there would be a 1 percent decrease to Idaho customers over each of the next five years.

Coeur d'Alene's Charles Walker calls the rate promises a "come-on to get Avista customers on the hook."

"Then what?" he wrote.

Avista and Hydro One last July announced the Canadian firm would buy Avista for $5.3 billion. In September, the companies filed an application requesting IPUC approve the merger agreement. The parties in April agreed to terms of the transaction in documents filed in Idaho and Washington.

Public hearings will also be held today in Moscow and Wednesday in Sandpoint.