State regulators reject sale of AEL&P to Canadian firm

Hydro One will re-file application to take over Juneau utility

Alaska Electric Light and Power Company Lemon Creek operations center in Juneau. (Michael Penn | Juneau Empire File)

Alaska’s utility regulator has rejected a request from Canadian firm Hydro One to take over Alaska Electric Light and Power. The rejection was based on a legal technicality, and a spokeswoman for AEL&P said the request will be refiled.

 

On Wednesday, the Regulatory Commission of Alaska issued an order denying an application “to acquire a controlling interest in Alaska Electric Light and Power Company” that had been filed Sept. 14.

Ontario-based Hydro One had also sought a waiver from rules requiring it to show proof that, as a foreign corporation, it can do business in Alaska. Hydro One contended that because AEL&P will be managed through Spokane-based Avista Corp., and because Avista will be handled through a Delaware-based LLC, Hydro One did not have to show that proof.

In their order, RCA commissioners Stephen McAlpine, Rebecca Pauli, Robert Pickett, Norman Rokeberg and Janis Wilson rejected that argument.

“Because the burden of registration is minor when weighed against the benefit to the public from the additional safeguards afforded by registration and the availability of additional information not otherwise provided under our regulations, we do not find good cause to waive the … requirement that Hydro One and Olympus Equity include proof of registration to do business in Alaska as part of their application to acquire a controlling interest in AEL&P,” the commissioners ruled.

Thirty-four public comments were noted by the commissioners, including one from the City and Borough of Juneau and one from former state senator Lesil McGuire of Anchorage. Juneau Hydropower Inc., which is attempting to build a hydroelectric dam near Juneau, noted in its public comment that Hydro One told Washington regulators that any cost savings from the purchase will not be passed on to Juneau customers. AEL&P told the City and Borough of Juneau Assembly that the transfer is not expected to increase electricity rates.

With the waiver request denied, the commissioners determined that Hydro One had not filed the necessary paperwork to complete the transfer of AEL&P. They then rejected that larger transfer request.

The decision may be appealed within 30 days — no appeal had been filed by the time of this writing — and the rejection was made “without predjudice” according to administrative law judge James Walker, meaning it can be refiled with the proper paperwork.

AEL&P vice president and spokeswoman Debbie Driscoll said by email that it is accurate to say that the paperwork will be refiled.

Last week’s order is the latest step in a process that began in July, when the largest power company in Ontario announced it would buy the parent company of AEL&P for $5.3 billion.

That parent company, Washington-based Avista, acquired AEL&P from its Juneau owners in 2013. The company has been providing electricity to Juneau for 120 years.


• Contact reporter James Brooks at james.k.brooks@juneauempire.com or call 523-2258.


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