Regulators reject Hydro One deal

COEUR d’ALENE — Ontario politicians exert too much control over Hydro One for Idaho law to permit the $5.3 billion sale of Avista to Hydro One, the Idaho Public Utilities Commission said Thursday. “In this case, we find the Applicants have failed to carry their burden under Idaho Code 61-327.”

That section of Idaho law forbids selling public utilities to certain entities, including “any organization acting as...representative for, or in concert...with, any such government...;” or “any company...whose issued capital stock, or other evidence of ownership...is owned or controlled, directly or indirectly, by any...govermental or political unit.”

The commissioners concluded that based on its 47 percent ownership of Hydro One stock, plus its role in cleaning house at Hydro One’s headquarters last fall, “Hydro One is directly and indirectly subject to the control and ownership interest of the Province of Ontario.”

Norm Semanko, attorney for the Avista Customer Group, said the commission made the right decision Thursday.

“Avista customers have feared from the beginning that foreign government control — exercised from Toronto, Canada — could result in big rate increases and other adverse impacts to Avista customers, with no real avenue for recourse,” Semanko said. “The Commission correctly recognized that Idaho law forbids this kind of control over electric utility services by a foreign government.”

A spokesman for Avista said Thursday, “The companies are disappointed in the Commission’s decision, are reviewing the order in detail and will determine the appropriate next steps.”

The Idaho commissioners decided to forego judgment on whether Idaho Code 61-328 might also bar the proposed deal. That section of Idaho law requires any sale of a public utility to be in the public interest, not raise rates, and keep the utility in the public service. However, the commissioners did offer a note of “caution” to the two companies on that count, writing that “This Commission remains concerned about the outer limits of the Province’s power over Hydro One.”

The commissioners also decided to award intervenor funding to three outside groups that challenged the deal. Idaho Code 61-617A provides for up to $40,000 to defray the cost of legal fees, witness fees, transportation, and other expenses for intervening parties “to encourage participation at all stages of all proceedings before this Commission so that all affected customers receive full and fair representation in those proceedings.”

Thursday’s order directed Avista to pay $15,813.87 in intervenor funding to the Avista Customer Group, $10,442.11 to the Idaho Conservation League, and $13,744.02 to the Community Action Partnership Association of Idaho.

Though the order is final, the commissioners noted that petitions for reconsideration are welcome within 21 days from the date of the order.

A spokesman for Avista did not comment on the possibility of petitioning for reconsideration in Idaho. However, on Dec. 17, 2018, the two companies filed a petition requesting that the Washington Utilities and Transportation Commission reconsider its Dec. 5 order denying approval of Hydro One’s acquisition of Avista. The petition also included a request that the Washington UTC rehear the matter to accept new evidence.

Semanko sounded a confident note, saying: “We are pleased with the Idaho Commission’s decision and trust that it will finally bring this long ordeal to an end.”