Seen a Rogue on the loose? Get in touch with our Roguemeister: JOHN SCHRAG jschrag@wweek.com (503) 243-2122 FAX: (503) 243-1115 Utility companies are such easy targets for criticism that it takes a lot for one to end up in our Rogues Gallery. Last week PacifiCorp made the cut. On Feb. 9, the state Public Utility Commission held a public hearing about PacifiCorp's most recent rate increase. The Citizens' Utility Board, a local watchdog group, calculates that the request, if approved, would result in the largest rate hike in a decade: an 18.6 percent increase over two years for residential customers, penciling out at about $146 annually for the average ratepayer. But it's not the sheer size of the hike that caught our attention. It's the justification. PacifiCorp needs the rate increase to offset large losses it suffered in 1998 in a bungled attempt to buy a British utility. That effort cost Pacificorp more than $150 million and was followed not long afterwards by another $100 million loss on an ill-fated electricity trading venture. "PacifiCorp is basing its rate increase on the company's performance in 1998, which just happens to be the worst year in the company's recent history," says Bob Jenks, CUB's executive director. PacifiCorp spokesman Dave Kvamme argues that 1998 is the best basis for comparison because it is the most recent year for which full data was available when the request was filed. Moreover, Kvamme says, other utilities are also currently seeking rate hikes. Finally, in making its case, PacifiCorp said that even if it gets the increase its prices will still be among the lowest in the United States and, adjusted for inflation, will be 25 percent lower than 1989. Jenks says that argument is specious. Almost all electric rates in the Pacific Northwest are lower than the national average. Jenks says the latest federal Energy Information Administration figures show that PacifiCorp's current residential rate of 6.15 cents per kilowatt hour is already the highest of any major utility in Oregon. "The source of the problem isn't that they're undercharging," Jenks says. "It's that they're trying to make customers pay for management mistakes." The PUC will hold another public hearing on the rate request Feb. 16 in Bend and is scheduled to make a ruling this summer. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Willamette Week | originally published February 16, 2000