20171205Notice of Affiliate Transaction.pdf

!.PaclnConp R. Jeff Richards
Vice President and General Counsel
1407 W. North Temple, Suile 320
Salt Lake CiO, UT 84116
801-220-4734 OfJice
j eff . r i c h a r d@1t ac iJi c o rp. c o m
December 5,2017
Idaho Public Utilities Commission
472 West Washington
Boise,ID 83702-5983
Attention: Diane Hanian
Commission Secretary
PacifiCorp Notice of Affiliate Transaction
Case No. PAC-E-05-8
Dear Ms. Hanian
This letter will serve as notice pursuant to Commitmentl lT(2), incorporated in the Idaho
Public Utilities Commission OrderNo. 29973 issued February 13,2006, as supplemented by Order
No. 29998 March 14,2006, in the above-referenced proceeding, approving the acquisition of
PacifiCorp by MidAmerican Energy Holdings Company (now "Berkshire Hathaway Energy
Company" or "BHE"), of an affiliated interest transaction with BNSF Railway Company
("BNSF") for coal transportation services, from all Wyoming Powder River Basin coal mines to
the PacifiCorp Dave Johnston power plant, located in Glenrock, Wyoming.
A verified copy of the highly confidential BNSF Railway Common Carrier Pricing Authority
90068 Attachment A Coal Unit Train Commitment Certificate Number BNSF 90068-0078
("Agreement") is included with this Notice as Attachment A (see confidentiality protections
sought below).
PacifiCorp is a wholly-owned indirect subsidiary of Berkshire Hathaway Energy Company
("BHE"). BHE is a subsidiary of Berkshire Hathaway, [nc. BNSF is also a subsidiary of Berkshire
Hathaway, Inc. Therefore, Berkshire Hathaway, Inc.'s ownership interest in BHE and BNSF
creates an affiliated interest relationship between the Company and BNSF in some PacifiCorp
jurisdictions.
The existing long term rail agreement to provide for the transportation of coal needed to fuel
PacifiCorp's Dave Johnston plant expires on December 3l,2017.PacifiCorp is the owner and
operator of the Dave Johnston plant. The Dave Johnston plant is "captive" to the BNSF Railroad
with respect to rail service. There are no other rail delivery options available from alternative
railroads, and the distance between the mines and plant makes shipping coal via truck both cost
prohibitive and logistically impractical. The new Agreement has been negotiated at arms-length,
and the value will vary depending on the source mine for the coal. The aggregate cost is currently
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Diane Hanian
Notice of Affiliate Transaction
December 5,2017
estimated to be based on expected future supplier mix, for the four year Agreement
through December 31, 2021
Entering into the new Agreement is in the public interest because it allows PacifiCorp to continue
to efficiently operate the Dave Johnston plant. Without the new Agreement, PacifiCorp would not
be able to obtain the coal needed to continue operating the plant at a reasonable cost. BNSF is the
only entity that can provide the coal to PacifiCorp via rail.
PacifiCorp requests highly confidential treatment for Attachment A. The Agreement contains
highly commercially sensitive pricing information that could expose the Company and BNSF to
competitive injury if disclosure is unrestricted. Please contact Ted Weston at [phone] to
make arrangements to review. The Company respectfully requests that if any intervenors in this
docket, or any other party, requests Attachment A, the Commission promptly notify PacifiCorp of
such request, so that PacifiCorp may seek such a protective order authorizing highly confidential
treatment prior to any disclosure of Attachment A.
Please do not hesitate to contact me if you have any questions.
Best
R. Jeff
Vice President and General Counsel
PacifiCorp
Enclosures