Idaho Power Seeks to Transfer Oregon Service Area to Oregon Trail Electric Cooperative
Key Insights
Idaho Power and OTEC are seeking approval from the Oregon PUC to transfer Idaho Power's Oregon distribution system to OTEC.
The proposed sale is valued at $154 million and is expected to close in early 2027.
If approved, approximately 20,000 Idaho Power customers in four Oregon counties would become OTEC member-owners, expanding OTEC’s service territory.
Former Idaho Power customers could see a rate increase of about 5.7% upon transaction approval, which is less than the 17% increase Idaho Power said it would likely need to implement without the sale.
Idaho Power would continue to own and operate generation and transmission resources in Oregon, including the Boardman to Hemingway (B2H) transmission line.
Why this matters: This transfer aims to balance rising service costs with maintaining reliable energy service for customers in eastern Oregon. It also gives customers a greater voice in their energy cooperative.
In-Depth Analysis
The agreement involves OTEC purchasing wholesale energy from Idaho Power under a multi-year power supply agreement to serve its new member-owners. Idaho Power said that without the sale, it would likely need to pursue a general rate increase of at least 17% in Oregon to recover capital investments and inflation costs. With the sale, OTEC would need to recover the investment already made in the system and would need to charge former Idaho Power customers approximately 5.7% more than their current Idaho Power rates upon transaction approval. Former Idaho Power customers in eastern Oregon would continue to receive energy and local service throughout the transition, and as OTEC member-owners, they would gain a voice in their cooperative through board elections and capital credits returned to members and communities. More information is available at idahopower.com/Oregon?ref=yanuki.com and otec.coop/IdahoPower?ref=yanuki.com.
FAQs
Q: What happens if the sale is not approved?
Idaho Power has stated that it would likely need to pursue a general rate increase of at least 17% in Oregon to recover costs.
Q: How will this affect customers in eastern Oregon?
Customers will become member-owners of OTEC and are expected to see a rate increase of approximately 5.7%, which is less than the potential 17% increase from Idaho Power. They will also gain a voice in their cooperative through board elections and capital credits.
Key Takeaways
This proposed transfer of ownership aims to mitigate potentially larger rate increases for customers in eastern Oregon while ensuring continued reliable energy service. By becoming member-owners of OTEC, customers will have a greater say in their energy future.
Key takeaways:
Potential 5.7% rate increase under OTEC versus a possible 17% increase under Idaho Power without the sale.
Customers become member-owners of OTEC, gaining voting rights and capital credits.
Idaho Power retains ownership of key generation and transmission assets in Oregon.
Discussion
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