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What’s not to like about PacifiCorp purchase

Editorial May 27, 2005 Klamath Falls Herald and News by Pat Bushey


Most people probably won’t notice much difference in the operations of PacifiCorp after its sale from ScottishPower to MidAmerican Energy Holdings is complete.  MidAmerican is owned by financier Warren Buffett and his associates.


PacifiCorp provides power for much of Oregon, including the Klamath Falls area, and parts of Northern California.  It also operates dams on the Klamath River.


It looks like a good deal for our region.


When ScottishPower purchased PacifiCorp six years ago, our reaction as we looked at the power lines, dams and substations that were part of the local PacifiCorp distribution system was more or less, “What are we going to sell next, the street system?”


That idea that a company headquartered in a foreign country could own such a basic utility serving local people was bothersome.


ScottishPower wasn’t a bad owner, Power still flowed, the service was good and the rates stayed reasonable.  PPM, an offshoot of PacifiCorp – which will still be owned by the Scotland-based company – became a partner with the city of Klamath Falls in building the Klamath Falls cogeneration plant, which is producing strong dividends for the city.


Still, there was a nagging negative feeling about a foreign-based company owning all of those power lines running through the area.


“It’s going to be very nice to be U.S. owned,” said Sally LaBriere, PacifiCorp regional manager, after the sale was announced,


It is, indeed.


As for Buffett, what’s not to like?


He’s not the classic “rip and run” type, out to make a quick buck by any means possible.


He’s reputed to be the second-richest man in America.  He made his money by investing carefully in good companies and holding their stocks more-or-less forever – at least in stock market terms.  (If you had invested $10,000 with him in 1956, it would now be worth $350 million, give or take a few dollars.)


He’s careful, respected and people listen to him.  And the fact he’s buying PacifiCorp says that PacifiCorp is probably a well-run organization in good shape financially.  That’s good news for the Northwest.


The sale also means that PacifiCorp isn’t going to have to deal with the sorts of issues that surround Portland General Electric, which serves the Portland area and became part of Enron.  PGE is now up for sale as one of the few assets that Enron has.


As for the two major issues that PacifiCorp has going in the Klamath Basin, we doubt if the sale will make any difference.


We can’t see it having an impact on either the Klamath River dams being relicensed to PacifiCorp, or with the utility’s efforts to jack up power rates to local irrigators.  They aren’t the kind of issues that seem likely to be affected by the transfer of the utility from one responsible owner to another.





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