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Moody's Looks at Plant Divestiture

Fortnightly Magazine - June 15 1997

a dispute between hydro power and fisheries interests at the Kaw Dam in Oklahoma by the FERC enforcement attorneys serving as mediators. According to the Oklahoma Municipal Power Authority, the "parties had tried unsuccessfully for a period of years to find a way to resolve the dispute. [We] believe the settlement will stand the test of time, whereas litigation can leave all parties dissatisfied with the outcome."

AAA is a not-for-profit, public service organization dedicated to resolution of disputes since 1926 through use of negotiation, mediation, arbitration and other means. In 1996, more than 70,000 cases were filed with it.

An agreement between PacifiCorp and Bonneville Power Administration will lead to an 8-percent rate cut for PacifiCorp.'s Utah Power irrigation customers in Southeastern Idaho. Impetus for the agreement came from two Idaho legislators, the governor's office and the congressional delegation.

The proposed agreement was filed at the Idaho Public Utilities Commission and also will go through BPA's internal review process. The agreement will result in payments totaling $47.7 million over the next four years from BPA to PacifiCorp for Utah Power's Idaho residential irrigation customers. The utility will use some money to cut recent price increases by one-half, effective May 1, 1997. Prices for Utah Power's irrigation customers in Idaho had increased 16 percent over the past two years due to reductions in the BPA Regional Exchange Credit, which has been in place since 1980.

Congress created the credit to share the benefits of federally owned hydroelectric plants with customers of investor-owned utilities in the Columbia River drainage area. The credit is based on the difference between BPA's prices and Utah Power's costs. A schedule of subsequent reductions in the BPA Exchange Credit for Utah Power customers has not been determined, but in 1995 Congress had urged that it be phased out by June 2001. Utah Power officials expect that the agreement with BPA will result in the present credit being phased out for irrigation customers before that date.

Lori A. Burkhart is an associate legal editor with PUBLIC UTILITIES FORTNIGHTLY.

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