[TCDPCO] PSE gets earful over rate plan, proposed buyout

[Pickett]

Coverage of last night's UTC hearing...

Paul

http://www.theolympian.com/southsound/story/469400.html

PSE gets earful over rate plan, proposed buyout
By Christian Hill | The Olympian • Published June 05, 2008

Fifty-one meeting attendees told state regulators Wednesday night that a
proposed buyout of Puget Sound Energy and rate increase are a bad deal for
customers.

The state Utilities and Transportation Commission had its last of three
public hearings on the proposed $7.4 billion buyout of the state's largest
private utility to a consortium of investors from Australia and Canada as
well as a proposed rate increase for its electricity and natural-gas
customers.
More than 100 people attended the hearing, and about half testified before
the three commissioners on their views of the buyout, rate increase or both.
Some came from as far away as Tacoma and Port Townsend. Two spoke in favor
of the buyout, and one testified that he could support the rate increase.
Commissioners must approve the buyout and rate increase for them to move
forward. Recommendations to the commission from all parties are due June 18
for the merger proposal. The commission will make a final decision in
November on the rate case. Speakers railed against proposals that they said
were weighted in favor of profits for executives and shareholders and
against the well-being of customers.

About the buyout, they raised concerns about losing control of the utility
to foreign investors, the consortium's financial stability and whether the
real driver was the enrichment of top executives. Numerous speakers
mentioned Enron, the one-time Wall Street energy darling that collapsed into
bankruptcy in 2001 because of shady financing. "For them, it's business,"
said Paul Pickett, a commissioner for the Thurston Public Utility District,
which serves the Tanglewilde and Thompson Place neighborhoods outside Lacey.
"For the rest us, it's our lives."

Sue Taylor of Olympia urged the commissioners to proceed cautiously before
turning the utility over to foreign interests. "We need to take a long, hard
look at it," she said of the proposed buyout, "and I don't think it's the
success story we've been hearing."

As for the rate increase, people said paying more for gas and electricity
will strain more families and could spell financial ruin for low-income and
disabled residents living paycheck to paycheck.

Several said they've done all they could to conserve energy and questioned
why the utility wasn't looking at more innovative ways to curb its costs and
add to its capacity.

Marsha Stockdill of Olympia told commissioners they should hold the
utility's "feet to the fire to come up with other ways to deal with energy."
"I cannot fathom what it's going to be like to keep having rate increases,"
she said.

Kimberly Fish of Plateau Outreach Ministries in Enumclaw said the need for
the nonprofit organization's low-income energy assistance is growing, when
it usually dwindles as the weather warms. More senior citizens and people
with disabilities "are not able to make ends meet," and higher rates would
worsen the situation, she said.

The utility said the rate increases are needed to recoup investments in
energy infrastructure during the previous two years as well as pay for
unanticipated expenses from storm damage. It said the buyout will make it
easier to raise $5 billion in capital to invest in energy supplies and
infrastructure to meet its customers' needs now and in the future, as the
utility is stymied by low cash flow and a poor credit rating.

The utility's request totals $237.8 million, which would increase rates
12.11 percent for residential electricity customers and 5.9 percent for
natural-gas customers.

The Public Counsel Section of the state Attorney General's Office, which
represents customers and small businesses, said the request is too high and
recommends a significant reduction in the proposed rates.

The utility has 119,000 electric and 45,500 natural-gas customers in
Thurston County.

Christian Hill covers Lacey and the military for The Olympian. He can be
reached at 360-754-5427 or chill at theolympian.com.
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