20171213Notice of Affiliate Transaction.pdf

YPecrnConp R. Jelf Richards
Vice President and General Counsel
1407\Y. North Temple, Suile 320
Salt Lake City, UT 84116
801-220-4734 Ollice
j eff. r i c h a r ds@1t ac ifi c o rp. c o m
December 13,2017
Idaho Public Utilities Commission
472 West Washington
Boise, ID 83702-5983
I.- i,
Re: PacifiCorp Notice of Affiliate Transaction ' H ;o.
Case No. PAC-E-05-A .. .1 : 3i]-., c^) m
Dear Ms. Hanian: i;!= = 5
This leuer will serve as notice pursuant to Commitm entl 17(2), incorporated in theffiho Hlblic-
Utilities Commission Order No. 29973 issued February 13,2006, as supplemented Q OrdftlNo.
29998 March 14, 2006, in the above-referenced proceeding, approving the a@uisition 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 BNSF-served mines in New Mexico to the Cholla
Generating Station near Joseph City, Arizona.
A verified copy of the highly confidential BNSF Railway Common Carrier Pricing Authority
90068 Attachment A Coal Unit Train Commitment Certificate Number BNSF 90068-0080
("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, Inc. 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 the
Cholla Generating Station expires on December 31,2017. The rail agreement is a joint agreement
between BNSF, Arizona Public Service Company ("APS") and PacifiCorp. APS is the operator of
the Cholla plant. APS has ownership in Unit #1, Unit #2 (retired l0l20l5), and Unit #3. PacifiCorp
owns Unit #4.The rail agreement is a two year rail agreement for 2018 & 2019. The agreement
also has a unilateral extension option for one additional year 2020, if triggered by either APS or
PacifiCorp or both companies. The new Agreement has been negotiated at arms-length, and the
Attention: Diane Hanian
Commission Secretary
REDACTED
Diane Hanian
Notice of Affiliate Transaction
December 13,2017
value will vary on the source mine for the coal. Pac ifiCorp's share of the cost is
currently estimated to be
December 31,2019.
based on shipments, for the two year Agreement through
Entering into the new Agreement is in the public interest because it allows PacifiCorp to continue
to efficiently operate Cholla Unit #4. 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 the Cholla Generating Station 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 Regards,
R. Jeff
Vice President and General Counsel
PacifiCorp
Enclosure
HIGHLY CONFIDENTIAL
CASE NO. PAC.E.Os.O8
PACIFICORP NOTICE OF AFFILIATE TRANSACTION
BNSF RAILWAY COMPANY
COMMON CARRIER PRICING AUTHORITY BNSF 90068
ATTACHMENT A
COAL UNIT TRAIN COMMITMENT CERTIFICATE NUMBER
BNSF 90068-0078
Attachment A is highly confidential in its entirety. Rocky Mountain
Power requests special handling of Attachment A as it contains
highty commercially sensitive pricing information. Please contact
Ted Weston at [phone] to make arrangements to review.