20080418Williams Direct.pdf

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2008 AFW I 7 ..'
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BEFORE THE IDAHO PUBLIC UTILITIES COMMSSION urfL ~~~f!UC
wirvnSSIO.
In the matter of the Application of )
Rocky Mounta Power for a Certificate )
of Convenience and Necessity Authoriing )
Construction of the Populus to Terminal )
345 kV Transmission Line Project )
DIRECT TESTIMONY OF
BRUCE N. WILLIAMS
CASE NO. PAC-E-08- 0"3
Direct Testimony of Bruce N. Wiliams
APRIL 2008
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Please state your name, business address and present position.
My name is Bruce N. Wiliams. My business address is 825 NE Multnomah,
Suite 1900, Portland, Oregon 97232. I am the Vice President and Treasurer.
Please briefly describe your education and business experience.
I received a Bachelor of Science degree in Business Administration with a
concentration in Finance from Oregon State University in June 1980. I also
received the Charered Financial Analyst designation upon passing the
examination in September 1986. I have been employed by the Company for 22
years. My business experience has included fiancing of the Company's electrc
operations and non-utilty activities, investment management, and investor
relations.
Please describe your present duties.
I am responsible for the Company's treasur, credit risk mangement, pension
and other investment management activities.
What is the purpose of your testimony?
My testimony describes generally how the Company will finance the constrction
of the Populus-to-Terminal Transmission Project (the "Transmission Project").
What do you expect the source of funds to be for the construction of the
Transmission Project?
The Company expects to use a reasonable mix of capital designed to provide a
competitive cost of capital, predictable capital market access and to allow the
Company to remain financially stable. The Company anticipates utilizing fuds
from sources similar to those used in the past, including operating cash flows and
Wiliams, Di - 1
Rocky Mountan Power
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the issuace of new long-term and short debt and, if necessar, new equity capital
to fud the constrction of the Transmission Project.
Is the Company capable of rmancing the construction of the Transmission
Project?
Yes. In addition to the internally generated fuds, the Company curently has
access to the capital markets and expects to be able to borrow fuds necessary to
help finance the constrction of the Transmission Project. This access was
evidenced most recently by the Company's October 2007 issuace of $600
milion of first mortgage bonds. PacifiCorp senior secured debt is curently rated
'A3' and 'A-' by Moody's Investors Service and Stadard and Poor's,
respectively, both of which are investment grade ratings. In addition, the
Company has received cash equity contrbutions from its parent company in the
past and, if necessar, may again in the futue. The Company's access to the
capital markets in the futue will be infuenced by outcomes of regulatory matters,
industr developments and reguatory authority to issue securties.
Does the Company have regulatory authority suffcient to allow it to finance
the construction of the Transmission Project?
Yes. The Company has authority to issue suffcient amounts of short-term and
long-term debt and common equity for constrcting the Transmission Project.
Our regulatory authority allows securties to be issued for certn puroses
including (l) the acquisition of propert, (2) the constrction, completion,
extension or improvement of utilty facilties, (3) the improvement of service, (4)
the discharge or lawfl refuding of obligations which were incured for utilty
Wiliams, Di - 2
Rocky Mountain Power
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puroses or (5) the reimbursement of the Company's treasur for fuds used for
the foregoing puroses.
Does the Company have a debt-to-equity ratio which provides the Company
with rmancial stabilty?
Yes, the Company's capital strctue is appropriate for providing financial
stability in ths matter. The Company expects its capita strcture may change
over time, due in par to capital spending, nonetheless it expects to remain
financially stable.
Does this conclude your direct testimony?
Yes.
Wiliams, Di - 3
Rocky Mountan Power