As Promised

As promised, here is the response from Pacific Power to my previous post on PUD formation in Clatsop County.

Watching with great interest as this issue is discussed. As an employee and spokesman for Pacific Power, though, I do need to correct a few points thrown around in your recent blog post.

One, Pacific Power is not an “off-shore company.” Scottish Power hasn’t been in the picture since March 2006, when MidAmerican Energy Holdings Company purchased PacifiCorp, and therefore Pacific Power. MidAmerican Energy is based in Des Moines, Iowa and PacifiCorp’s corporate headquarters is in Portland.    Pacific Power’s home office is in Portland and serves Oregon, Washington and Northern California.  We also have a presence in Utah, Wyoming and Idaho, serving those communities as Rocky Mountain Power, and our sister utility in Iowa, MidAmerican Energy Company.  It is from these affiliated businesses that we have brought in crews to assist in restoration during and after the 2007 storm.  Today we are most assuredly not a Scottish-owned company and haven’t been for a long time.  

Two, our energy portfolio is not as described. Non-hydro renewable (mostly wind) make up 10 %, Hydro 10%, natural-gas-fired 20%, coal fired 52%. (The rest is bought off the market.) We eliminated new coal plants from our plans years ago and we are investing in making the ones we do own cleaner. We have increased our commitment to wind power by 3,000 percent since 2005, making us the second largest utility owner of wind power in the nation, second only to our sister utility in Iowa. We are well on our way to meeting the state’s “25% by 2025” Renewable Portfolio Standards, a standard that smaller PUDS are not obligated to meet. Our company is among the most aggressive renewable energy companies in the U.S.; MidAmerican just acquired more than 800 megawatts of solar projects in late 2011, on top of our wind, geothermal and biomass projects.

Three, our community donations, which have been ongoing for more than a century now, are not funded by the 3 % surcharge on your bill. That surcharge is a state-mandated charge that goes specifically to the Energy Trust of Oregon for energy efficiency and small renewable energy project funding.  It also goes toward home weatherization assistance and to energy efficiency programs for schools. 

Pacific Power’s community impact and giving is not part of our rates, but comes directly from our shareholders and employees.  We give through our foundation and through direct company philanthropy.  For instance we donated over $510,000 in contributions from our employees and owners just in 2011 for low-income energy assistance, and give about $50,000 in direct grants and sponsorships in Clatsop County each year.

Four, the “comparative rates” are not accurate. And the biggest inaccuracy would be the impression that any existing PUD rates would be approximate to what would be paid by a new PUD. Unless and until accurate research and analysis are done to estimate the true cost to taxpayers and ratepayers from a government condemnation to take over and set up a new utility, there is really no accurate way to compare rates that don’t really exist yet.

There are plenty of conclusions in your blog that we also take issue with, but first we thought it might help to clear up a few of the basics on which you are basing your argument. As you said in your opening, “a little research.” A little more research was needed. Call me any time if you have a question.

Tom Gauntt

Spokesman, Pacific Power

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As Planning Commission Chair Bruce Francis told Pacific Power's Pat Eagan, This is really going to come down to three things. Rate, reliability and, the value of local control.

Sure. What we pay for power plays into this but before putting a price tag on this proposal we need to have a discussion about what the expectations would be for an operational philosophy if a PUD were to be formed here.

It is important going in to be clear about why we would spend the next two or three years setting all this up.  For example, I would hate to see a PUD board that has a philosophy akin to manifest destiny where it never stops growing until you end up with a wonderful facility and huge staff instead of the kind of operation where the focus is on long term reliable service at a reasonable rate for the customers. How often can a PUD raise rates I wonder? 

One area where it could all fall to pieces rapidly comes with the election of the board that will guide the new organization.  This can't be a typical popularity contest with a disconnected, ill-informed electorate. The first incarnation of the PUD board must be comprised of people who understand what leadership, management and strategic planning are all about.  This can't be the kind of board that doesn't have time to pay attention, allows itself to be badly informed, and leaves leadership of the organization strictly to it's managers.  This is a critical service organization that needs full time attention. Being well-meaning won't be enough. Since local politics might make the creation of such a board nearly impossible perhaps it would be possible to have an active advisory group composed of individuals with the level of experience necessary to guide the process. That might be the first action taken by a new PUD board.

What if the County decides to drop this idea as Pacific Power has demanded? It's entirely possible that during the 

discussion that will take place at the County Board level that this idea might attract little public interest, or be given a very low, or perhaps no priority at all.  The cities might decide they'd rather not go this direction either. What happens if a city opts out? If an election is held and the majority of citizens in one city want the PUD but the majority in a smaller city don't want a PUD, what happens then?  Lots of questions.  Few answers yet. 

It will be interesting to watch what happens over the next couple of months.