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ScottishPower wins Utah's OK Utility requests a rate increase for Washington By WILLIAM McCALL The Associated Press PORTLAND -- The last state needed to approve the first foreign takeover of a U.S. electric utility has given its permission for the $7.9 billion ScottishPower acquisition of PacifiCorp. The Utah Public Service Commission approved the deal just as Portland-based PacifiCorp asked the Washington Utilities and Transportation Commission for a $25.8 million electricity price hike, or 15.3 percent. Earlier this month, PacifiCorp asked the Oregon Public Utility Commission for an 11.9 percent increase as the state prepares to take on the task of restructuring the deregulated utility industry. But ScottishPower spokeswoman Rachel Sherrard noted that PacifiCorp planned to ask for both increases well before the takeover and that PacifiCorp has not asked for a major rate increase in Washington since 1986 and for more than a decade in Oregon. Utah approval of the takeover means only paperwork is left to be sorted before the deal can be closed, probably just days short of Dec. 7, when the deal was announced last year. "After all the excitement and work that's gone into it, you end up in a lawyer's office sitting at a table to sign a piece of paper," Sherrard said. "But from the company's point of view, it's a major achievement to get it done within a year." PacifiCorp serves about 1.4 million customers across six states: California, Idaho, Oregon, Utah, Washington and Wyoming. Regulators in all six state, and various federal agencies, now have approved the deal. Analysts say ScottishPower, the second-largest utility in the United Kingdom, is getting a solid but underperforming U.S. company. In Oregon, for example, PacifiCorp's earnings are about half the return on investment it's authorized to receive as a regulated utility under state law. "The challenge historically for PacifiCorp has been management that may have been too focused on expansion rather than its core business," said Jay Dobson, a utility analyst for Donaldson, Lufkin and Jenrette in New York. But ScottishPower has a proven track record for good management in Europe and is acquiring PacifiCorp at the start of deregulation in Oregon, giving ScottishPower a chance to start fresh with Oregon utility commissioners. "They bring a significant benefit to the United States, and the regulators in Utah, Oregon and the other Western states know this," Dobson said. But officials of the Citizens' Utility Board, an Oregon watchdog group, were cautious. "If they're going to take over and give PacifiCorp direction, then it's going to be welcome," said Jason Eisdorfer, an attorney and spokesman for CUB. Eisdorfer said that, in the past year, PacifiCorp has pushed for increasing residential rates in order to lower rates for commercial and industrial customers who might otherwise switch to other electricity suppliers as the utility market is deregulated. "The PacifiCorp interpretation of deregulation is they can do whatever they need to do to keep those customers from going to the market," Eisdorfer said. Today's Business Index Mail Tribune Copyright � The Mail Tribune 1999, Medford, Oregon USA