SALT LAKE CITY — The Utah State Legislature appears poised to force a breakup of Pacificorp, the parent company of Rocky Mountain Power.
On Wednesday, Rocky Mountain Power President Dick Garlish faced a pair of tense committee hearings on Utah's Capitol Hill where lawmakers criticized the electric utility over its proposed rate hike and environmental policies in other states. FOX 13 News reported in September that House Speaker Mike Schultz, R-Hooper, was suggesting a breakup of the utility in part over its proposed 30% rate hike (now revised to 18%).
A report prepared for lawmakers outlined a series of benefits and risks and concluded it's tricky. States are in regulatory compacts and a breakup could be very expensive, Garlish warned. Costs have gone up, there's extreme weather events and each state has its own policy agenda. Rocky Mountain Power is a part of Pacificorp, which is owned by Berkshire Hathoway. It boasts it is the largest electric grid operator in the western United States.
But lawmakers on Wednesday expressed irritation with the utility's proposed rate hike and suggested there was more concern for Pacificorp shareholders than customers. One of the committee chairs also expressed irritation with the utility's wildfire policies, service interruptions and "Pacific Coast policies."
"These are some of the things that frustrate us as legislators when the consumers who pay the monthly bills see that the gas bill’s going down 30 to 40% and the electric rates are going up 30%? That’s hard to swallow," said Rep. Carl Albrecht, R-Richfield, the co-chair of the Utah State Legislature's Public Utilities, Energy and Technology Interim Committee.
Garlish told committee members he understood the frustration, but it will take time to feasibly see if it is possible to break up the company.
"I get that people are frustrated. I get that the legislature is frustrated, I get that customers are frustrated. I am frustrated. But right now in this, the way the structure is... what’s in my gift today is to provide the service, keep the investor engaged, stay as reliable, keep it affordable as possible and then fight six state commissions and the federal government to make sure I have the money keep that utility financially stable and healthy so we can keep going with the model that’s brought us this far."
Garlish told him "we can respectfully agree to disagree about some" of the other claims leveled, defending his employees and their work.
"This will be my parting shot: the House, the Senate, leadership in both bodies and the executive branch would like to see this separation," Rep. Albrecht said, telling Garlish to take that to his superiors at Berkshire Hathaway and tell them that "Utah is serious about this."
Rep. Joel Briscoe, D-Salt Lake City, suggested that the "divorce papers" might cost Utah customers more than they bargained for. Garlish said there would be a lot of costs that need to be explored.
The Utah State Legislature recently reworked its energy policies to favor an "all of the above" approach that legislative leaders insist ensures an abundant and affordable energy supply. But critics have accused lawmakers of favoring fossil fuels when they should focus more on renewable sources of energy in the face of climate change.
Sen. Nate Blouin, D-Salt Lake City, said if there's a focus on reliability and cost, would it improve by "Balkanizing" the utility?
"I don't know," Garlish replied, adding: "Other people besides Dick Garlish are going to have to decide what the benefits and burdens are. You all are going to have to decide that."
