20260123Final_Order_No_36915.pdf

Office of the Secretary
Service Date
January 23,2026
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ROCKY MOUNTAIN ) CASE NO. PAC-E-25-18
POWER'S APPLICATION FOR )
AUTHORITY TO ALLOW PARENT ) ORDER NO. 36915
COMPANY TO MAINTAIN A COMMON )
EQUITY PERCENTAGE OF LESS THAN 44 )
PERCENT )
On September 24, 2025, Rocky Mountain Power, a division of PacifiCorp ("Company"),
applied to the Idaho Public Utilities Commission ("Commission") requesting authority to allow
the Company's direct parent company, PPW Holdings LLC ("PPW Holdings"), to maintain an
equity percentage below the 44 percent minimum threshold set by the Commission in Case No.
PAC-E-05-08 ("Application").
On October 10, 2025, the Commission issued a Notice of Application and Notice of
Intervention Deadline, establishing a 21-day intervention period. Order No. 36801. There were no
intervenors in the case.
On December 12, 2025, the Commission issued a Notice of Modified Procedure,
establishing written comment deadlines. Order No. 36870. On January 9, 2026, Staff filed
comments recommending the Commission deny the Company's Application. On January 12,
2026, Staff notified the Commission that it had begun settlement negotiations with the Company.
On January 14, 2026, Staff filed supplemental comments recommending that the Commission
approve the Application with certain modifications. On January 15,2026,the Company filed reply
comments agreeing to the modifications proposed by Staff.
With this Order, the Commission approves the Company's Application with the
modifications described herein.
BACKGROUND
In 2006, the Commission issued Order No. 29973 (amended by Order No. 29998),
approving MidAmerican Energy Holdings Company (which is now Berkshire Hathaway Energy
Company) and Berkshire Hathaway, Inc.'s application to acquire the Company. The approval
included a requirement that PPW Holdings' consolidated capital structure contain at least 44
percent of common equity capital after 2011 ("Idaho Commitment 21"). Order No. 29998,
Consolidated List of Commitments, Commitment No. 21.
ORDER NO. 36915 1

THE APPLICATION
As of June 30, 2025, PPW Holdings' capital structure included an equity percentage of
45.9 percent. Application at 1. However, the Company stated that due to its wildfire liabilities,
increased long-term debt,and lower earnings projections for 2025-2026,PPW Holdings will likely
be too leveraged to maintain an equity percentage above the 44 percent minimum threshold for the
next several years. Id. at 1-2.
According to the Company, allowing PPW Holdings' equity to decrease below 44 percent
would serve the public interest by enabling the Company to maintain its generation,transmission,
and distribution system; to make necessary capital investments; and to meet its other merger
commitments.Id. at 4-5. The Company also represented that it has taken steps, such as suspending
shareholder dividends, to limit PPW Holdings' equity dilution.Id. at 5.
STAFF COMMENTS
Upon review of the Company's Application, Staff initially recommended that the
Commission deny the Company's request to allow PPW Holdings to maintain an equity percentage
below the 44 percent minimum threshold established by Idaho Commitment 21. Staff Comments
at 1. Staff stated that Idaho Commitment 21 was intended to protect customers from a single
shareholder taking dividend payments without providing meaningful equity to the utility's
operations. Id. at 2. Staff contended noncompliance with Idaho Commitment 21 was unjustified
partly because the wildfire liabilities cited by the Company are largely attributable to Oregon
wildfires and were possibly incurred as a result of policy decisions reflected in Oregon law. Id. at
3. Additionally, Staff did not believe the Company had sufficiently identified a need for capital
investment in transmission or renewable generation projects that would result in noncompliance
with Idaho Commitment 21.Id.
Alternatively, Staff recommended that, if the Commission granted the Company's request,
the Commission should also require the Company to use its actual capital structure rather than a
hypothetical capital structure for ratemaking purposes in future general rate cases. Id. at 2. In the
event the Commission approved the Company's request, Staff also recommended the Commission
refuse any reduction in the Company's equity ratio as justification for increasing the Company's
authorized return on equity.Id. at 4.
After discussion with the Company, Staff recommended the Commission approve the
Company's request to allow PPW Holdings to maintain an equity percentage below 44 percent,
ORDER NO. 36915 2

while imposing additional conditions. Staff Supplemental Comments at 2. According to Staff, its
proposed modifications would serve as safeguards to protect ratepayers and would be of
convenience for the Company, which will be subject to substantially similar conditions under an
agreement with the Oregon Public Utilities Commission("OPUC").Id. (citing OPUC Docket No.
UM 2406). Specifically, Staff proposed the Commission order:
I. PPW Holdings may contain common equity capital below the 44 percent
specified in Idaho Commitment 21,but no lower than 35 percent, for a base period
of three years starting on the date of any order by the Commission approving the
Application. PPW Holdings may contain common equity capital below 44 percent,
but no lower than 35 percent, for two additional one-year periods beyond the base
period, but each one-year extension is subject to Commission approval prior to the
expiration of the base period or the one-year extension, if granted.
2. PPW Holdings will issue no debt, common or preferred stock, or other
securities, whether hybrid or otherwise, during the base period plus any extensions
as discussed above.
3. The Company and PPW Holdings will not pay any dividends while PPW
Holdings has a common equity capital below 44 percent.
Id.
COMPANY REPLY COMMENTS
In its reply comments,the Company agreed to Staff s proposed conditions that would allow
PPW Holdings to contain a common equity capital below 44 percent,but no lower than 35 percent,
for three years, with two additional one-year extensions subject to Commission approval.
Company Reply Comments at 3. The Company also expressly committed that PPW Holdings
would not issue any debt, preferred stock, or other securities while PPW Holdings has a common
equity capital below 44 percent. Id. The Company noted that it remains subject to other financial
commitments that limit its ability to make dividends to PPW Holdings or Berkshire Hathaway
Energy Company.Id. at 3.
The Company stated that it plans to raise funds for operations and capital investments by
issuing new long-term debt and retaining earnings,which might temporarily lower PPW Holdings'
equity percentage. Id. at 2.
ORDER NO. 36915 3

COMMISSION FINDINGS AND DECISION
The Commission's jurisdiction over this matter under Idaho Code § 61-328 requires
Commission authorization for certain electric utility transactions, including mergers and
acquisitions.Under the statute,the Commission has discretion to attach terms and conditions to its
authorization that serve the public convenience and necessity. Idaho Code § 61-328(4).
Additionally, Idaho Code § 61-501 authorizes the Commission to "supervise and regulate every
public utility in the state and to do all things necessary to carry out the spirit and intent of the
[Public Utilities Law]."
Based on our review of the record, the Commission finds it fair, just, and reasonable to
approve the Company's requested waiver of Idaho Commitment 21, and authorize PPW Holdings
to maintain an equity percentage below 44 percent, subject to the following conditions, to which
the Company has committed to adhere: (1) PPW Holdings' consolidated capital structure will not
contain common equity capital below 35 percent; (2) the waiver of Idaho Commitment 21 shall
expire after a three-year base period, beginning on the service date of this Order; (3) prior to the
waiver's expiration, the Company may apply to the Commission for approval of two separate,
single-year extensions beyond the base period; (4) PPW Holdings shall issue no debt, common or
preferred stock, or other securities, whether hybrid or otherwise, while PPW Holdings has a
common equity capital below 44 percent; and (5) neither the Company nor PPW Holdings shall
pay any dividends while PPW Holdings has a common equity capital below 44 percent.
The Commission cautions that,prior to approving any single-year extension of the waiver
contemplated by the conditions listed above, it expects PPW Holdings' common equity capital to
have a positive trajectory, indicating the Company's intention to return to compliance with Idaho
Commitment 21.
Approval of this waiver and its conditions in no way limit the position that any party may
advance regarding the Company's capital structure or return on equity in any future rate case.
ORDER
IT IS HEREBY ORDERED that the Company's requested waiver of Idaho Commitment
21,which requires PPW Holdings' consolidated capital structure to contain common equity capital
of at least 44 percent, is approved, subject to the following conditions, to which the Company has
committed to adhere:
ORDER NO. 36915 4

(1) PPW Holdings' consolidated capital structure will not contain common equity capital
below 35 percent;
(2) The waiver of Idaho Commitment 21 shall expire after a three-year base period,
beginning on the service date of this Order;
(3) Prior to the waiver's expiration, the Company may apply to the Commission for
approval of two separate, single-year extensions beyond the base period;
(4) PPW Holdings shall issue no debt, common or preferred stock, or other securities,
whether hybrid or otherwise, while PPW Holdings has a common equity capital below
44 percent; and
(5) Neither the Company nor PPW Holdings shall pay any dividends while PPW Holdings
has a common equity capital below 44 percent.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one(21) days of the service date of this Order regarding any matter
decided in this Order. Within seven (7) days after any person has petitioned for reconsideration,
any other person may cross-petition for reconsideration.Idaho Code §§ 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho, this 23rd day of
January 2026.
G
EDWARD LODGE, P SIDENT
N R. HAMMOND JR., COMMISSIONER
HA IE, COMMISSIONER
ATTEST:
,I I.
Monica Ba o nchez
Commission Secretary
I:\Legal\ELECTRIC\PAC-E-25-18_equity\orders\PACE2518_FO j l.docx
ORDER NO. 36915 5