UF 4262, INITIAL (APPLICATION, COMPLAINT, PETITION), … · 2010-01-21 · creditsupportarrangements, (3) enterinto currency swaps, and (4) contribute orsell additional debtto special-purposeentities

PACIFICORPA MIDAMER1CAN ENERGY HOLDINGS COMPANY

January 14,2010

VIA ELECTRONIC FILINGAND OVERNIGHTDELIVERY

Oregon Public Utility Commission550 Capitol Street NE, Suite 215Salem, OR 97301-2551

Pacific Power IRocky Mountain Power

825 NE MultnomahPortland, Oregon 97232

Attention: Filing Center

Re: Docket UF---In the Matter of the Application ofPACIFICORP for authority to (1) issueand sell or exchange not more than $2,000,000,000 of debt, (2) enter intocredit support arrangements, (3) enter into currency swaps, and (4)contribute or sell additional debt to special-purpose entities.

Enclosed for filing by PacifiCorp ("Company"), is an original and three (3) copies of anApplication pursuant to ORS 757.405, ORS 757.410(1), ORS 757.415 and OAR 860-270030. Specifically, in this Application PacifiCorp requests authority for the following:

1) To issue and sell or exchange, in one or more public offerings or privateplacements, fixed or floating-rate debt ("Debt") in the aggregate principalamount not to exceed $2,000,000,000 or, if the Debt is issued at an originalissue discount, such greater amount as shall result in an aggregate offeringprice of not more than $2,000,000,000 (or its equivalent amount in, or basedupon, foreign currencies determined at the time of issue),

2) To enter into letter of credit arrangements with one or more banks or suchother agreements or arrangements as may be necessary or appropriate, fromtime to time, to provide additional credit support for the payment of theprincipal of, interest on and premium (if any) on such Debt,

3) To enter into one or more currency swaps, and4) To contribute or sell additional Debt to special-purpose entities ("SPEs") in an

amount based upon the common securities of the SPE.

The requested authority is expected to accommodate the Company's 2010 and 2011financing requirements. These requirements include continuing high levels of capitalexpenditures to serve customers, including procurement of renewable resources,investment in infrastructure, and the refinancing of approximately $600 million ofmaturing debt over the two-year period. The Company expects that it will use asubstantial portion of this requested authority during 2010 and 2011 and will seeksubsequent new or amended authority from the Commission to permit continued accessto the long-term debt markets.

The requested authority would supplement the financing flexibility that the Commissionhad previously authorized in Order No. 08-013 in Docket 4243 ("2008 Order"). In the

Oregon Public Utility CommissionJanuary 14,2010Page 2

2008 Order, the Commission authorized the Company to issue up to $2.0 billion ofsecurities identical to those covered in the enclosed Application. The Company hassubsequently issued $1.8 billion principal amount of debt under the 2008 Order authorityand has $200,000,000 of additional issuance authorized under that order. As theCompany does not anticipate utilizing the remaining authority under the 2008 Order, itmay be withdrawn if the Commission issues its order in this matter.

The enclosed application is substantially similar to the application submitted inconnection with the 2008 Order.

The Company respectfully requests that the Commission issue its order on or beforeFebruary 24, 2010. The Company also requests 20 certified copies of any order issued inthis matter.

It is respectfully requested that all data requests regarding this material be addressed to:

By E-Mail (preferred):

By regular mail: Data Request Response CenterPacifiCorp825 NE Multnomah, Suite 2000Portland, Oregon, 97232

Informal questions should be directed to Bruce Williams at (503) 813-5662 or Joelle Stewardat (503) 813-5542.

Your attention to this matter is appreciated.

Sincerely,

Bruce N. WilliamsVice President and Treasurer

Enclosures: Application (1 original and 3 copies)Proposed Form of Order (1 original and 3 copies)

BEFORE THE PUBLIC UTILITY COMMISSIONOF OREGON

UF_

In the Matter of the Application ofPACIFICORP, d.b.a. PACIFIC POWERfor authority to (1) issue and sell orexchange not more than $2,000,000,000 ofdebt, (2) enter into credit supportarrangements, (3) enter into currencyswaps, and (4) contribute or sell additionaldebt to special-purpose entities.

APPLICATION OFPACIFIC POWER AND

WAIVER OF PAPERSERVICE

1 Pursuant to ORS 757.405, ORS 757.410(1), ORS 757.415 and OAR

2 860-27-0030, PacifiCorp, d.b.a. Pacific Power ("Company"), hereby applies

3 ("Application") for an order of the Public Utility Commission of Oregon ("Commission")

4 authorizing the Company to (1) issue and sell or exchange, in one or more public

5 offerings or private placements, fixed or floating-rate debt ("Debt") in the aggregate

6 principal amount of not more than $2,000,000,000 or, if the Debt is issued at an original

7 issue discount, such greater amount as shall result in an aggregate offering price of not

8 more than $2,000,000,000 (or its equivalent amount in, or based upon, foreign currencies

9 determined at the time of issue), (2) enter into letter of credit arrangements with one or

10 more banks or such other agreements or arrangements as may be necessary or

11 appropriate, from time to time, to provide additional credit support for the payment of the

12 principal of, the interest on and the premium of the Debt, (3) enter into one or more

13 currency swaps, provided that, with respect to the Debt contemplated in clauses (1), (2)

14 and (3), such Debt is either issued with a cost to maturity not exceeding the spreads over

15 treasury yields established by the Commission or is issued with a cost to maturity not

16 exceeding 9.0 percent per annum, and (4) contribute or sell additional Debt to special-

17 purpose entities ("SPEs") in an amount based upon the common securities of the SPE and

Page 1 - UF __ PacifiCorp Financing Application

Commission approval of the proposed guarantee and expense payment agreements

2 relating to the preferred securities of the SPE, in each case substantially as described

3 herein. The Company requests that such authority remain in effect so long as the

4 Company's senior secured debt has investment grade ratings from at least two nationally

5 recognized ratings agencies. The Company requests that the debt issuance described

6 herein, amend and supersede the debt issuance approved by the Commission in Docket

7 No. UF 4243 ("2008 Docket") Order No. 08-013 ("2008 Order"). This Application is

8 substantially similar to that filed by the Company in the 2008 Docket and seeks

9 authorization to issue up to $2,000,000,000 of long-term debt on the same terms and

10 conditions contained in the 2008 Order.

11 Additionally, the Company respectfully WaIves paper serVice in this docket

12 pursuant to OAR 860-013-0070(4). The Company respectfully requests that the

13 Commission issue an order by February 24, 2010.

14 I.

15 (a)

161718

19 (b)20

Compliance with OAR 860-027-0030 Filing Requirements.

Exact name and address of Company's principal business office.

PacifiCorp825 N.E. Multnomah, Suite 2000Portland, OR 97232

State in which incorporated; date of incorporation; and the other states inwhich authorized to transact utility business.

21 The Company was incorporated under Oregon law in August 1987 for the purpose

22 of facilitating consummation of a merger with Utah Power & Light Company, a Utah

23 corporation, and changing the state of incorporation of PacifiCorp from Maine to Oregon.

24 The Company currently serves customers as Pacific Power in California, Oregon and

25 Washington and as Rocky Mountain Power in Idaho, Utah and Wyoming.


1 (c)2

Name and address of person(s) authorized to receive notices andcommunications regarding this application.

Bruce N. WilliamsVice President and TreasurerPacifiCorp825 N.E. Multnomah, Suite 1900Portland, OR 97232Telephone: 813-5662E-mail: lIDJ~~!Yillillrruilis2lliJ1.9lti~lliQn!

Joelle StewardOregon Regulatory Affairs ManagerPacific Power825 NE Multnomah, Suite 2000Portland, OR 97232Telephone: 813-5542E-mail: j.Q~il~,,~:'{@;!@Qf!&illQQffi@m

Natalie HockenVice President & General CounselPacific Power825 N.E. Multnomah, Suite 2000Portland, OR 97232Telephone: 813-7205E-mail: mtlillJs~~mr.fQp1!&!lJ~Q!J2"f~;m}

JeffB. ErbAssistant General CounselPacifiCorp Energy825 N.E. Multnomah, Suite 600Portland, OR 97232Telephone: 813-5029E-mail: ~L..~!JJg~Q!!!Y..QIP.:fQi1l

3 It is respectfully requested that all Staff requests regarding this material be4 addressed to:

5 Bye-mail (preferred):

6789

By regular mail: Data Request Response CenterPacifiCorp825 NE Multnomah, Suite 2000Portland, Oregon 97232

10 Informal inquiries may be directed to Bruce Williams at (503) 813-5662.

11 (d) Names and titles ofthe principal officers of the Company.

Greg Abel

Rob Lasich

R. Patrick Reiten

A. Richard Walje

Brent R. Gale

Mark Moench

Doug Stuver

President & CEO, PacifiCorp

President, PacifiCorp Energy

President, Pacific Power

President, Rocky Mountain Power

Senior Vice President, PacifiCorp

General Counsel, PacifiCorp

Senior Vice President, Chief Financial Officer, PacifiCorp


1 (e)2

3

Description of the general character of the business done and to be done, anda designation of the territories served.

The Company provides retail electric service to customers as Pacific Power in

4 California, Oregon and Washington and as Rocky Mountain Power in Idaho, Utah and

5 Wyoming. A map showing PacifiCorp's service territories is included as Exhibit M.

6 (1)789

1011

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Statement, as of the date of the balance sheet submitted with this application,showing for each class and series of capital stock: brief description; theamount authorized (face value and number of shares); the amountoutstanding (exclusive of any amount held in the treasury), held amount asreacquired securities; amount pledged by the Company; amount owned byaffiliated interests, and amount held in any fund.

The capital stock as of September 30, 2009 is as follows:

Cumulative Preferred Stock:

5% Preferred, $100 stated value(126,533 shares authorized)

OutstandingShares

126,243

Amount

$12,624,300

Serial Preferred, $100 stated value(3,500,000 shares authorized)

4.52% Series4.56% Series4.72% Series5.00% Series5.40% Series

6.00% Series7.00% Series

Total Preferred Stock

Common Stock*:No Par Value(750,000,000 shares authorized)

2,065 $206,500

84,592 $8,459,20069,890 $6,989,00041,908 $4,190,800

65,959 $6,595,900

5,930 $593,00018,046 $1,804,600

414,633 $41,463,300

357,060,915

*All shares ofoutstanding common stock are indirectly owned by MidAmerican Energy Holdings Company.


1 (g)23456

Statement, as of the date of the balance sheet submitted with this application,showing for each class and series of long-term debt or notes: brief description(amount, interest rate and maturity); amount authorized; amountoutstanding (exclusive of any amount held in the treasury): amount held asreacquired securities; amount pledged by the Company; amount held byaffiliated interest; and amount in sinking and other funds.

7 The long-term debt as of September 30, 2009 is as follows:

Description

First Mortgage Bonds:

6.90% Series due November 15, 20115.45% Series due September 15,20134.95% Series due August 15,20145.65% Series due July 15,20185.50% Series due January 15,20197.70% Series due November 15,20315.90% Series due August 15,20345.25% Series due June 15,20356.10% Series due August 1,20365.75% Series due April 1, 2037 .6.25% Series due October 15, 20376.35% Series due July 15,20386.00% Series due January 15,2039

8.271% C-U Series due thru October 1,20107.978% C-U Series due thru October 1,20118.493% C-U Series due thru October 1,20128.797% C-U Series due thru October 1,20138.734% C-U Series due thru October 1,20148.294% C-U Series due thru October 1,20158.635% C-U Series due thru October 1, 20168.470% C-U Series due thru October 1,2017

9.15% MTN Series C due August 9,20118.92% MTN Series C due September 1,20118.95% MTN Series C due September 1,20118.29% MTN Series C due December 30, 20118.26% MTN Series C due January 10,2012


Authorized

$500,000,000$200,000,000$200,000,000$500,000,000$350,000,000$300,000,000$200,000,000$300,000,000$350,000,000$600,000,000$600,000,000$300,000,000$650,000,000

$48,972,000$4,422,000

$19,772,000$16,203,000$28,218,000$46,946,000$18,750,000$19,609,000

$8,000,000$20,000,000$45,000,000

$3,000,000$1,000,000

Outstanding

$500,000,000$200,000,000$200,000,000$500,000,000$350,000,000$300,000,000$200,000,000$300,000,000$350,000,000$600,000,000$600,000,000$300,000,000$650,000,000

$9,145,000$1,144,000$6,640,000$6,535,000

$12,905,000$23,308,000$10,290,000$11,460,000

$8,000,000$20,000,000$45,000,000

$3,000,000$1,000,000

Description Authorized Outstanding

First Mortgage Bonds:8.28% MTN Series C due January 10, 2012 $2,000,000 $2,000,000

8.25% MTN Series C due February 1,2012 $3,000,000 $3,000,000

8.53% MTN Series C due December 16,2021 $15,000,000 $15,000,000

8.375% MTN Series C due December 31, 2021 $5,000,000 $5,000,000

8.26% MTN Series C due January 7, 2022 $5,000,000 $5,000,000

8.27% MTN Series C due January 10,2022 $4,000,000 $4,000,000

8.13% MTN Series E due January 22,2013 $10,000,000 $10,000,000

8.07% MTN Series E due September 9,2022 $8,000,000 $8,000,000



8.05% MTN Series E due September 14, 2022 $10,000,000 $10,000,000

8.05% MTN Series E due September 18, 2022 $15,000,000 $15,000,000

8.08% MTN Series E due October 14, 2022 $51,000,000 $51,000,000

8.23% MTN Series E due January 20, 2023 $5,000,000 $5,000,000

8.23% MTN Series E due January 20, 2023 $4,000,000 $4,000,000

7.26% MTN Series F due July 21,2023 $38,000,000 $38,000,000

7.23% MTN Series F due August 16,2023 $15,000,000 $15,000,000

7.24% MTN Series F due August 16,2023 $30,000,000 $30,000,000

6.72% MTN Series F due September 14, 2023 $2,000,000 $2,000,0006.75% MTN Series F due September 14,2023 $7,000,000 $7,000,0006.75% MTN Series F due October 26,2023 $48,000,000 $48,000,000

6.71% MTN Series G due January 15,2026 $100,000,000 $100,000,000

7.00% MTN Series H due July 15,2009 $125,000,000 $125,000,000

Total First Mortgage Bonds: $5,647,427,000


Pollution Control Bonds:Moffat County, Colorado

Variable% Series 1994 due May 1, 2013 $40,655,000 $40,655,000

Converse County, Wyoming3.90% Series 1988 due January 1,2014 $17,000,000 $17,000,000Variable% Series 1992 due December 1, 2020 $22,485,000 $22,485,000Variable% Series 1994 due November 1,2024 $8,190,000 $8,190,0004.125% Series 1995 due November 1,2025 $5,300,000 $5,300,000

Sweetwater County, WyomingVariable% Series 1988B due January 1,2014 $11,500,000 $11,500,0003.90% Series 1984 due December 1,2014 $15,000,000 $15,000,000

Variable% Series 1990A due July 1,2015 $70,000,000 $70,000,000Variable% Series 1988A due January 1,2017 $50,000,000 $50,000,000Variable% Series 1992A due December 1, 2020 $9,335,000 $9,335,000Variable% Series 1992B due December 1, 2020 $6,305,000 $6,305,000Variable% Series 1994 due November 1,2024 $21,260,000 $21,260,000Variable% Series 1995 due November 1, 2025 $24,400,000 $24,400,000

Lincoln County, Wyoming3.40% Series 1991 due January 1,2016 $45,000,000 $45,000,0005.625% Series 1993 due November 1, 2021 $8,300,000 $8,300,000Variable% Series 1994 due November 1,2024 $15,060,000 $15,060,0004.125% Series 1995 due November 1,2025 $22,000,000 $22,000,000

City of Gillette, WyomingVariable% Series 1988 due January 1,2018 $63,000,000 $41,200,000

Emery County, UtahVariable% Series 1991 due July 1, 2015 $45,000,000 $45,000,0005.65% Series 1993A due November 1,2023 $46,500,000 $46,500,0005.625% Series 1993B due November 1,2023 $16,400,000 $16,400,000Variable% Series 1994 due November 1,2024 $121,940,000 $121,940,0006.15% Series 1996 due September 30, 2030 $12,675,000 $12,675,000

Carbon County, UtahVariable% Series 1994 due November 1,2024 $9,365,000 $9,365,000

City ofForsyth, Montana4.125% Series 1986 due December 1,2016 $8,500,000 $8,500,000Variable% Series 1988 due January 1,2018 $45,000,000 $45,000,000

Total Pollution Control Bonds $738,370,000

Page 7 UF __ PacifiCorp Financing Application

1 (h)234

Full description of the securities proposed to be issued, showing: kind andnature of securities or liabilities; amount (face value and number of shares);interest or dividend rate, if any; date of issue and date of maturity; andvoting privileges, if any.

5 The Debt is to be issued in one or more transactions as conditions permit. The

6 Debt may be secured or unsecured and may be subordinated or unsubordinated.

7 Alternatives currently available to the Company include (1) conventional first mortgage

8 bonds placed publicly or privately in the domestic or foreign markets, (2) secured or

9 unsecured medium-term notes placed publicly or privately in the domestic or foreign

10 markets, (3) floating-rate debt placed publicly or privately in the domestic or foreign

11 markets, (4) Eurodollar financings placed publicly or privately overseas, (5) debt issued

12 overseas denominated in, or based upon, foreign currencies combined with a currency

13 swap to effectively eliminate the currency risk, and (6) subordinated debt placed publicly

14 or privately in the domestic or foreign markets and issued either alone or in conjunction

15 with an offering of preferred securities by a SPE organized by the Company. A brief

16 description of these transactions is set forth below.

17 1. First Mortgage Bonds.

18 First mortgage bonds have been the traditional debt financing vehicle utilized by

19 utilities in the U.S., and are typically offered in public offerings but may be privately

20 placed. First mortgage bonds are secured by a mortgage on the fixed assets of the utility.

21 These bonds are typically redeemable at the Company's option at redemption

22 prices dependent upon U.S. Treasury yields. The Company may determine that a call

23 provision is appropriate to provide financial flexibility in changing interest rate

24 environments, and the bonds may be redeemable at a premium over the principal amount,

25 with the premium declining to zero near the final maturity of the bonds.


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The Company's first mortgage bonds are issued as First Mortgage Bonds under

the PacifiCorp Mortgage. The Commission authorized the Company to incur the lien of

the PacifiCorp Mortgage in Docket No. UF 3990, Order No. 88-1363.

II. Medium-Term Notes.

Medium-term notes ("MTNs") are interest-bearing instruments with maturities

generally ranging between nine months and 30 years. MTNs are typically offered on a

continuous basis by the borrower through one or more managers, which act as agents in

placing the notes, either domestically or through global programs. MTNs can be offered

on a secured or unsecured basis.

Compensation to the agents varies by the maturity of each tranche of MTNs

issued, but is not expected to exceed one percent of the principal amount of notes placed.

The MTN investor universe in the U.S. consists of banks, insurance companies,

pension funds, thrifts, mutual funds, money managers, investment advisors, corporate,

and nonprofit organizations. Overseas, the investor profile primarily consists of banks,

insurance companies, pension funds and retail accounts.

MTN programs are generally structured to allow a wide range of terms. Principal

amount, currency, maturity, interest rate and redemption terms are fixed at the time of

sale. In the event the Company chooses to issue MTNs in foreign currencies, a currency

rate swap would be simultaneously entered into to effectively hedge the Company's

exposure against currency risk. If the Company issues secured MTNs, they will most

likely be issued in the form ofFirst Mortgage Bonds under the PacifiCorp Mortgage.

III. Floating-Rate Debt.

Floating-rate debt is a security with interest rates that reset periodically, such as


1 daily, weekly, monthly, quarterly, semi-annually or annually, at the option of the

2 Company. The most common indices used for pricing floating-rate debt are based upon

3 LIBOR, commercial paper and Treasury bills.

4 Refunding provisions for floating-rate debt vary from transaction to transaction

5 depending upon the structure of the agreement. Should the Company subsequently fix

6 the interest rate through an interest rate swap or cap, the cost of refunding would include

7 the cost ofunwinding the swap or cap.

8 Floating-rate debt could be more advantageous than fixed-rate debt. First, it can

9 provide the Company with an occasional source of long-term funding at attractive rates

10 compared to the fixed-rate market. Second, it allows the Company access to the short

11 end of the yield curve when short-term rates are attractive. Should rates begin to

12 increase, the Company could execute an interest rate swap or cap to secure a fixed rate.

13 The fees associated with a floating-rate debt arrangement are not expected to

14 exceed one percent of the principal amount of the debt.

15 IV. Eurodollar Financings.

16 Eurodollar bonds or debentures are dollar-denominated securities issued to

17 foreign investors. Eurodollar securities are generally placed by a foreign underwriter, or

18 a foreign subsidiary of a U.S. investment or commercial bank ("bank"). Eurodollar

19 securities are generally unsecured obligations. However, the Company may be required

20 to enter into a letter of credit arrangement with one or more banks, or such other

21 agreements or arrangements as may be necessary or appropriate, from time to time, to

22 support its obligation to repay the principal of, the interest on, and the premium (if any)

23 on the debt. Such an arrangement could involve a fee, not expected to exceed one


1 percent on the principal amount of the debt. The Company would receive dollars at the

2 time of closing and all interest and principal payments would be made in dollars.

3 A Eurodollar bond issuance is typically arranged using a bank as the underwriter

4 ("public offering") or placement agent ("private offering"). The bank's role is to locate

5 investors outside the United States that are interested in purchasing financial assets in

6 dollars. The interest rate charged on the debt is usually a spread over U.S. Treasury

7 obligations having a similar maturity. After the call protection has expired, the bonds are

8 generally callable at their principal value. The issuance fee associated with a Eurodollar

9 bond offering is approximately two percent of the principal amount sold.

lOA potential advantage of a Eurodollar offering is that it allows the Company to

11 access investors generally not active in the U.S. markets, and at the same time not subject

12 the Company to any currency exposure. Another advantage is that, from time to time,

13 very attractively priced funds become available in the private Eurodollar market when an

14 investor with dollars attempts to invest in U.S. dollar assets. Thus, for short periods, a

15 market could be created wherein the issuer can obtain very attractive rates relative to the

16 public markets. These windows in the market open and close very quickly, making it

17 necessary that the Company have the opportunity to commit quickly when offered an

18 attractive proposal.

19 V. Foreign Currency Debt Combined with a Currency Swap.

20 The issuance of debt denominated in a currency other than U.S. dollars, combined

21 with a currency swap, would allow the Company to issue debt in a foreign currency and

22 execute a currency swap to effectively eliminate the currency risk. By issuing in a

23 foreign currency, the Company would attract investors that would not normally be


1 investing in its securities. Issuing securities in a foreign currency becomes attractive

2 when the nominal interest rate charged in the foreign country is significantly lower than

3 the rate in the U.S. or in dollar-denominated securities. To the extent that the cost of

4 executing the currency swap is less than the difference between the nominal interest rate

5 in the foreign country and the dollar-denominated interest rate, issuing debt in a foreign

6 currency and executing a currency swap provides a lower total cost of debt.

7 The foreign currencies most frequently used in the past by U.S. compames

8 include Euro, Swiss Francs, British Sterling, Japanese Yen, Canadian Dollars, Australian

9 Dollars and New Zealand Dollars. The underwriters for a foreign currency offering are

10 responsible for locating investors willing to purchase the Company's debt that has

11 principal and interest denominated in the foreign currency. The fees for a foreign

12 currency offering are expected to approximate two percent of the principal amount sold.

13 In order to effectively eliminate the currency risk, the Company would enter into

14 a currency swap that would be executed simultaneously with the foreign currency

15 offering. In the currency swap, the Company would receive a stream of payments in the

16 foreign currency exactly equal in amount and timing to the Company's obligations for the

17 foreign currency debt ("principal and interest"). In exchange, the Company would agree

18 to make a stream of payments in U.S. dollars to the third party. The net effect of the

19 transaction is that the Company's foreign currency obligations would be exactly offset by

20 the foreign currency receipts under the exchange and the Company's net payments would

21 be in U.S. dollars.

22 Whether or not the other party to the exchange performs, the Company remains

23 obligated under the terms of the foreign currency debt. The Company would propose to


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minimize the risk of nonperformance in the exchange through the selection of a third

party participant with a long~term credit rating of AA equivalent or better or with a third

party which is a high quality sovereign or agency of a sovereign if the tenor of the

exchange agreement is five years or longer and long~term credit rating of A or better if

the tenor is less than five years.

The fees associated with arranging a currency swap agreement are a function of

interest rates and currency differentials between the U.S. dollar and the applicable foreign

currency.

Because a foreign offering with a currency swap involves two transactions and

multiple parties, the complexity and cost of trying to unwind such a foreign offering prior

to its final maturity effectively makes this type of transaction generally non-callable prior

to its final maturity.

Issuing debt denominated in a foreign currency combined with a currency swap

requires that the Company have a great degree of flexibility in timing the offering in

order to pick the currency, nominal interest rates, and exchange rate that will enable it to

achieve a lower cost.

To minimize costs, the Company will not undertake the proposed transactions in a

foreign market unless and until it can assure itself that the total cost of the foreign

borrowings proposed in this matter is no more than the total cost of domestic borrowings

for a similar term for companies of comparable credit rating at the time of the borrowing.

VI. Subordinated Debt.

It is anticipated that any subordinated debt could be issued in one or more series

pursuant to the Company's Indenture dated as of May 1, 1995, as supplemented, or

Page 13 - UP __ PacifiCorp Financing Application

1 pursuant to a new indenture. The Company may issue the subordinated debt (a) directly

2 to investors, as in the issuance and sale of its 8 3/8 percent Junior Subordinated

3 Deferrable Interest Debentures, Series A, pursuant to the orders issued in Docket No.

4 UF 4098; (b) in exchange for its outstanding securities, as in the issuance of its 8.55

5 percent Junior Subordinated Deferrable Interest Debentures, Series B, pursuant to Order

6 95-353, Docket No. UF 4126; or (c) to an SPE in support ofthe preferred securities of the

7 SPE, as in the issuance and sale of its 8 1/4 percent Junior Subordinated Deferrable

8 Interest Debentures, Series C, pursuant to the orders issued in Docket No. UF 4140, and

9 its 7.70 percent Junior Subordinated Debentures Series D, pursuant to the orders issued in

10 Docket No. UF 4151.

11 In a transaction involving preferred securities of an SPE, the Company would

12 organize the SPE and contribute or sell subordinated debt of the Company to the SPE in

13 an amount based upon the common securities of the SPE (generally 3 percent of the

14 aggregate liquidation preference of the preferred securities issued by the SPE). The SPE

15 would issue preferred securities, which are expected to have a liquidation preference of

16 $25 each, have cumulative dividends payable quarterly and could be listed on the New

17 York Stock Exchange. In addition, the SPE would purchase subordinated debt of the

18 Company in an aggregate principal amount corresponding to the liquidation preference of

19 the preferred securities issued by the SPE. In certain circumstances, the subordinated

20 debt of the Company underlying the preferred securities of the SPE could be distributed

21 to the holders of the preferred securities in connection with the liquidation of the SPE.

22 In this instance, the Company would guarantee the SPE's payment of: (i) any

23 accumulated and unpaid distributions required to be paid on the preferred securities of the


SPE to the extent that the SPE has funds on hand available therefore; (ii) the redemption

2 price with respect to any preferred securities called for redemption to the extent that the

3 SPE has funds on hand available therefore; and (iii) upon a voluntary or involuntary

4 dissolution, winding-up or liquidation of the SPE (unless the Company's subordinated

5 debt is distributed to holders of the SPE's preferred securities), the lesser of (a) the

6 aggregate of the liquidation preference and all accrued and unpaid distributions to the

7 date of payment and (b) the amount of assets of the SPE remaining available for

8 distribution to holders of the preferred securities. The guarantee is expected to be

9 directly enforceable by holders of the preferred securities issued by the SPE and

10 subordinate to all senior debt of the Company. It is also anticipated that the Company

11 and the SPE will enter into an expense reimbursement arrangement under which the

12 Company will agree to pay the expenses of the SPE.

13 (i)141516

Description of the proposed transaction, including a statement of the reasonswhy it is desired to consummate the transaction and the anticipated effectthereof. If the transaction is part of a general program, describe the programand its relation to the proposed transaction. Such description shall include:

1718

(A) Description of the proposed method of issuing and selling thesecurities.

19 The Company proposes to issue the Debt from time to time in either public

20 offerings or private placements, domestically or overseas, for cash or in exchange for its

21 outstanding securities. The financial markets have become increasingly global and as

22 such, foreign sources of capital compete directly with domestic sources for investment

23 opportunities. The Company anticipates that issuances will be primarily fixed-rate First

24 Mortgage Bonds, but it is requesting authority for a variety of borrowing options in order

25 to provide the financial flexibility to pursue the most attractive markets at the time of

26 issuance and to produce the most competitive cost for the Company.

Page 15 UF __ PacifiCorp Financing Application

Underwriters or placement agents will be selected after negotiations with a group

2 of potential candidates. The firm or firms selected to lead an offering under this authority

3 will be determined by the Company's opinion of their ability to assist the Company in

4 meeting its objective of having the lowest total cost for the Debt to be issued. This

5 opinion is based upon the level of underwriting or placement fees, their knowledge of the

6 Company and its varied operations, the Company's parent company and its affiliates, and

7 their ability to market the Debt to achieve the Company's financing and capital structure

8 objectives.

9 The Company also requests authority to issue Debt without further Commission

10 approval to the extent its cost to maturity does not exceed the maximum total spreads

11 over treasury yields (See Exhibit N) or is issued with a cost to maturity not exceeding

12 9.0 percent per annum in order to provide additional flexibility in the event spreads widen

13 or the Company decides to sell Debt, including a block of MTNs, through underwriters.

14151617

(B) Statement of whether such securities are to be issued pro rata toexisting holders of the Company's securities or issued pursuant to anypreemptive right or in connection with any liquidation orreorganization.

18 The Debt will not be issued pro rata to existing holders of the Company's

19 securities and will not be issued pursuant to any preemptive rights or in connection with

20 any liquidation or reorganization.

See Section (n)(A) below.

212223

24

25262728

(C)

(D)

Page 16 UF

Statement showing why it is in the Company's interest to issuesecurities in the manner proposed and the reason(s) why it selectedthe proposed method of sale.

Statement that exemption from the competitive bidding requirementsof any federal or other state regulatory body has or has not beenrequested or obtained, and a copy of the action taken thereon whenavailable.

PacifiCorp Financing Application

1 The issuance of the Debt is not subject to the competitive bidding requirements of

2 federal or state regulatory bodies.

3456789

1011

(j) Name and address of any person receiving or entitled to a fee for service(other than attorneys, accountants and similar technical services) inconnection with the negotiation or consummation of the issuance or sale ofsecurities, or for services in securing underwriters, sellers or purchasers ofsecurities, other than fees included in any competitive bid; the amount ofeach such fee, and facts showing the necessity for the services and that the feedoes not exceed the customary fee for such services in arm's lengthtransactions and is reasonable in the light of the cost of rendering the service,and any other relevant facts.

12 Other than for technical services, the only fees payable by the Company will be

13 fees and expenses to the underwriters and agents (including arrangement fees for

14 currency swaps). The Company may also incur an annual fee for credit support which is

15 not expected to exceed one percent on the principal amount of the Debt.

16 If the Debt is to be issued overseas, the fee is not expected to exceed 3.0 percent

17 of the aggregate principal amount of the Debt, subject to negotiations. If issued

18 domestically, the fee is not expected to exceed 1.0 percent of the aggregate principal

19 amount of the Debt. If subordinated debt is issued, the fee is not expected to exceed

20 3.15 percent of the aggregate principal amount of the Debt.

21 The level of the fee is only one factor in determining the overall cost of the Debt

22 to be issued and as such, is not the sole basis of the financing decision. The Company

23 believes that the aforementioned compensation levels to the agents or underwriters are

24 not greater than the usual and customary fees prevailing currently in the market. These

25 fees are reasonable given the services provided by the agents or underwriters. The agents

26 and the underwriters will be familiar with the Company, its parent company and affiliates

27 and their long-term financing needs. They will be available for consultation on these


1 matters and will assist the Company in evaluating market conditions and in formulating

2 the exact terms of the transactions.

3 (k) Statement showing both in total amount and per unit the price to the public,

4 underwriting commissions and net proceeds to the Company.

5 ESTIMATED RESULTS OF THE OFFERING (1)

Total Percent of Total

Gross Proceeds

Less: Agents/UnderwritersCompensation (1)

Proceeds Payable to Company

Less: Other Issuance Expenses

Net Proceeds

6 (1) Assumes the issuance of first mortgage bonds.

7 Other Issuance Expenses

$ 2,000,000,000

17,500,000$ 1,982,500,000

2,500,000

$ 1.980.000.000

100.000%

0.875%99.125%

0.125%

99.000%

$Regulatory agency fees

SEC fees

Company counsel fees

Accounting fees

Printing and engraving fees

Rating agency fees

Trustee/Indenture fees

Miscellaneous expenses

TOTAL

1,000

79,000

750,000

350,000

225,000

750,000

250,000

95,000

$ 2.500.000

8 (I) Purposes for which the securities are to be issued.

9 (A) Construction, completion, extension or improvement of facilities;10 description of such facilities and the cost thereof.


12345

6789

10

1112

13 (m)1415

16

(B) Reimbursement of the Company's treasury for expenditures against whichsecurities have not been issued; statement giving a general description ofsuch expenditures, the amounts and accounts to which charged, theassociated credits, if any, and the periods during which the expenditureswere made.

(C) Refunding or discharging of obligations; description of the obligations tobe refunded or discharged, including the character, principal amountsdiscount or premium applicable thereto, date of issue and date of maturity,purposes to which the proceeds were applied and all other material factsconcerning such obligations.

(D) Improvement or maintenance of service; description of the type ofexpenditures and the estimated cost in reasonable detail.

Statement as to whether or not any application, registration statement, etc.,with respect to the transaction or any part thereof, is required to be filedwith any federal or other state regulatory body.

In addition to this Application, the Company is filing an application with the

17 Idaho Public Utilities Commission and will provide a notice to the Washington Utilities

18 and Transportation Commission prior to the Debt being issued.

Facts relied upon by the Company to show that the issue:19 (n)

2021

(A) Is for some lawful object within the corporate purposes of theCompany.

22 As a public utility, the Company is expected to acquire, construct, improve, and

23 maintain sufficient utility facilities to serve its customers adequately and reliably at

24 reasonable cost. The proposed issuances of Debt are part of program to finance the cost

25 of the Company's facilities taking into consideration prudent capital ratios, earnings

26 coverage tests, market uncertainties and the relative merits of the various types of

27 securities the Company could sell or other financing it could arrange.

28 (B) Is compatible with the public interest.

29 See Section (n)(A) above.

3031

(C)

Page 19 - UF

Is necessary or appropriate for or consistent with the properperformance by the Company of service as a utility.

PacifiCorp Financing Application

1

2

3

See Section (n)(A) above.

(D) Will not impair the Company's ability to perform utility service.



4

5

67

(E)

(F)

Is reasonably necessary or appropriate for such purposes.

If filed under ORS 757.495, is fair and reasonable and not contrary tothe public interest.

8 The Company is not filing this Application pursuant to ORS 757.495. Therefore,

9 this requirement is not applicable. The Company respectfully requests a waiver of this

10 proVIsIOn.

11 (0)1213141516171819

Statement of all rights to be a corporation, franchises, permits and contractsfor consolidation, merger or lease included as assets of the Company or anypredecessor thereof, the amounts actually paid as consideration therefore,respectively, and the facts relied upon to show the issuance of the securitiesfor which approval is requested will not result in the capitalization of theright to be a corporation of or any franchise, permit or contract forconsolidation, merger or lease in excess of the amount (exclusive of any tax orannual charge) actually paid as the consideration for such right, franchise,permit or contract.

20 The requirement of OAR 860-027-030 (0) are not applicable. The Company

21 respectfully requests a waiver of these filing requirements.

22 (p) If filed under ORS 757.490, ORS 757.495:

23 The Company is not filing this Application pursuant to ORS 757.490 or ORS

24 757.495. Therefore, this filing requirement is not applicable. The Company respectfully

25 requests a waiver of this provision.

26 II. Exhibits.

Exhibit Description

A Docket No. UF 4193, Exhibit AThird Restated Articles of Incorporation effective November 20, 1996, asamended effective November 29, 1999.


B Docket No. UF 4237, Exhibit A-2A copy of the Bylaws with amendments to date.

C Resolutions of the Board of Directors authorizing the proposed issuances

D** A copy of mortgage indenture, or other agreement under which it isproposed to issue the securities, also a copy of any mortgage, indenture, orother agreement securing other funded obligations ofthe Company.

E Balance Sheet, actual and pro forma, dated September 30, 2009.

F A statement of all known contingent liabilities, except minor items such asdamage claims and similar items involving relatively small amounts, as ofthe date of this application.

G Income Statement, actual and pro forma, for the 12 months endedSeptember 30, 2009.

H Analysis of surplus for the period covered by the income statementsreferred to in Exhibit G.

J** Copy of the proposed and of the published invitation of proposals for thepurchase of underwriting of the securities to be issued; of each proposalreceived; and of each contract, underwriting, and other arrangemententered into for the sale or marketing or the securities. When a contract orunderwriting is not in final form so as to permit filing, a preliminary draftor a summary identifying parties thereto and setting forth the principalterms thereof, may be filed ending filing of conformed copy in the formexecuted by final amendment to the application.

K** Copies of the stock certificates, notes, or other evidence of indebtednessproposed to be issued.

M Map showing PacifiCorp service territories.

N Maximum Total Spread over the Benchmark Treasury Yield

1 **Exhibit or supplement to the Exhibit is to be filed as soon as available.

2 III. Conclusion.

3 PacifiCorp respectfully requests that the Commission enter an order in this

4 matter, effective upon issuance, authorizing PacifiCorp to issue debt as fully described in

5 this Application. The Company requests that such authority remain in effect so long as

6 the Company's senior secured debt has investment grade ratings from at least two

7 nationally recognized ratings agencies. The Company requests that the debt issuance


1 described herein, amend and supersede the debt issuance approved by the Commission in

2 Docket No. UF 4243, Order No. 08-013. The Company respectfully requests that the

3 Commission issue an order by February 24, 2010.

DATED January 14,2010

By:Bruce N. WilliamsVice President and TreasurerPacifiCorp


EXHIBITC

UNANIMOUS WRITTEN CONSENTOF THE BOARD OF DIRECTORS

OF PACIFICORP

Resolution No. 2009-004

Pursuant to ORS §60.341, the undersigned, constituting all the directors ofPacifiCorp, an Oregon corporation (the "Company"), hereby adopt and consent to thefollowing resolutions as of December 15,2009:

II. Securities Authorizations

A. First Mortgage, Collateral Trust Bonds and Other Debt Securities

WHEREAS, the Board of Directors of PacifiCorp (the "Company"), byresolutions adopted December 17, 2007 (the "Prior Resolutions")authorized the issuance and sale or exchange by the Company from timeto time of not more than $2,000,000,000 (or the equivalent thereof at thetime of issuance in foreign currencies) in aggregate principal amount ofone or more new series of its First Mortgage and Collateral Trust Bonds,to be issued under and secured by the Company's Mortgage and Deed ofTrust dated as of January 9, 1989 to the trustee thereunder (the "Trustee"),as heretofore amended and supplemented and as it may be furtheramended and supplemented (the "PacifiCorp Mortgage") or other debtsecurities; and

WHEREAS, it is now desirable to provide for the issuance of additionalbonds and restate the unused authority of the Prior Resolution; now,therefore, be it

RESOLVED, that the Board of Directors of the Company herebyauthorizes the issuance and sale or exchange by the Company, from timeto time, of up to $2,000,000,000 (or the equivalent thereof at the time ofissuance in foreign currencies) in aggregate principal amount of one ormore new series of its First Mortgage and Collateral Trust Bonds (the"Bonds"), to be issued under and secured by the PacifiCorp Mortgage; andfurther

RESOLVED, that the Bonds may be sold, or may be exchanged for otheroutstanding securities of the Company, publicly or in private transactions,in such amounts, at such times, at such prices, may bear interest at suchvariable, floating, or fixed rates, may be redeemable at such redemptionprices, mature at such date or dates, and have such other terms andcharacteristics as shall be fixed by an Authorizing Officer (as definedbelow); provided, however, that the issuance and sale or exchange by the

Page 1

Company of the Bonds shall be subject to (1) the Company's first havingobtained all necessary authorizations therefor from the federal and stateregulatory authorities having jurisdiction over such issuance and sale orexchange and (2) the Company's compliance with the registrationrequirements of all applicable federal and state securities laws inconnection with such issuance and sale or exchange; and further

RESOLVED, that in accordance with Section 2.03 of the PacifiCorpMortgage, each of the Chief Executive Officer, the Chief FinancialOfficer, and the Vice President and Treasurer of the Company, actingtogether with any president, or senior vice president of the Company(each, an "Authorizing Officer") is hereby authorized and empowered, inthe Company's name and on its behalf, to establish one or more series ofBonds, to approve one or more Supplemental Indentures, and anAuthorizing Officer, acting alone, is authorized to execute (by manual orfacsimile signature) and deliver Bonds in such form and containing suchterms, not inconsistent with Section 2.03 of the PacifiCorp Mortgage(including, without limitation, the amounts thereof, the rate or rates ofinterest, which may be floating or fixed, the maturity, sinking fund andredemption or repurchase provisions, if any, and the currencydenomination of any such series), as an Authorizing Officer shall approve,such approval to be conclusively evidenced by execution thereof by anAuthorizing Officer or by a certificate of an Authorizing Officer or bytransmittal of the terms of such series by any person designated in acertificate of an Authorizing Officer as having the authority to transmitsuch approval to the Trustee under the PacifiCorp Mortgage by computeror other electronic means; provided that each such series of Bonds shall bea) in registered form only, and b) shall have maturities at the time ofissuance of not less than nine months and not more than 30 years providedfurther, that an Authorizing Officer shall not be authorized to approve theissuance of any series of Bonds with fixed interest rates or initial floatinginterest rates exceeding 10 percent per annum unless specificallyauthorized by the Board of Directors; and further

RESOLVED, that the officer executing any said series of Bonds is herebyauthorized and directed to deliver the Bonds to the Trustee forauthentication; and that the Trustee under the PacifiCorp Mortgage ishereby requested to authenticate up to $2,000,000,000 in aggregateprincipal amount of Bonds (or the equivalent thereof at the time ofissuance in foreign currencies), or, if issued at an original issue discount,such greater amount as shall result in an aggregate offering price of up to$2,000,000,000, and to deliver the same upon the written order or ordersof an Authorizing Officer or upon instructions given under an automatedissuance system as described more fully in the PacifiCorp Mortgage or asupplement to the PacifiCorp Mortgage; and further

Page 2

RESOLVED, that the officers of the Company are hereby authorized anddirected to take or cause to be taken, in the Company's name and on itsbehalf, any and all such further action as in their judgment may bedesirable or appropriate to cause the execution, authentication and deliveryof said Bonds as specified in the immediately preceding resolution; andfurther

RESOLVED, that The Bank of New York, or any successor trustee underthe PacifiCorp Mortgage be and it hereby is appointed:

I) as agent of the Company upon whom notices, presentations anddemands to or upon the Company in respect of First Mortgage andCollateral Trust Bonds of each such series of Bonds, or in respect ofthe PacifiCorp Mortgage, may be given or made;

2) as agent of the Company in respect of the payment of the principalof, and the interest and any premium on, the Bonds of said series;and

3) as agent of the Company in respect of the registration, transfer andexchange of said Bonds; and further

RESOLVED, that, in connection with the issuance and sale of any seriesof Bonds denominated in foreign currencies, the Company shall enter intoa currency exchange, on such terms and conditions as shall be approvedby any Authorizing Officer, in order to fix the obligation of the Companyto repay the amount of said series and interest thereon in United Statesdollars; and further

RESOLVED, that, each of the Authorizing Officers is hereby authorizedand empowered, in the Company's name and on its behalf, (i) to select oneor more underwriters or agents for the placement of the Bonds and (ii) tonegotiate, execute and deliver one or more underwriting or sales agencyagreements or amendments, in one or more counterparts, including withinsuch agreements such terms and conditions (including terms concerningdiscounts, fees, or indemnification) as the officer or officers executingsuch agreements shall approve, his, her or their execution thereof to beconclusive evidence of such approval; and further

RESOLVED, that the Company is hereby authorized to enter into suchcredit support or enhancement agreements or arrangements, and anyamendments thereto or renewals thereof, in connection with the issuanceand sale or exchange of the Bonds as an Authorizing Officer shall approveafter first determining that such agreements or arrangements are necessaryor appropriate in the circumstances.

Page 3

B. Other Debt Securities

WHEREAS, pursuant to the Prior Resolutions, the Board of Directors ofthe Company authorized the issuance of $2,000,000,000 of other debtsecurities in addition to, or in lieu of, Bonds, provided that the aggregateprincipal amount of such other debt securities and Bonds not exceed$2,000,000,000 none of which other debt securities has been issued as ofthe date hereof; and

WHEREAS, it is now desirable to restate the unused authority under thePrior Resolutions; now, therefore, be it

RESOLVED, that, in addition to, or in lieu of, the issuance of Bonds asauthorized above, the Company is hereby authorized to issue, from time totime through one or more offerings, up to $2,000,000,000 (or theequivalent thereof at the time of issuance in foreign currencies or currencyunits) in aggregate principal amount of other secured or unsecured debtsecurities (the "Debt Securities"); provided, however, that the aggregateprincipal amount of Debt Securities issued hereunder and Bonds issuedpursuant to the foregoing resolutions shall not exceed $2,000,000,000 (orthe equivalent); and further

RESOLVED, that the Debt Securities may be sold, or may be exchangedfor other outstanding securities of the Company, publicly or in privatetransactions, domestically or in any foreign market, in such amounts,denominated in or based upon United States or foreign currencies, at suchtimes, at such prices, may bear interest at such variable, floating or fixedrates, may be redeemable at such redemption prices, mature at such date ordates, and have such subordination and other terms, conditions andcharacteristics as shall be fixed by an Authorizing Officer, subject to thelimitations set forth below; provided, however, that the issuance and saleor exchange by the Company of the Debt Securities shall also be subject to(1) the Company's first having obtained all necessary authorizationstherefor from federal and state regulatory authorities having jurisdictionover such issuance and sale or exchange, and (2) the Company'scompliance with the registration requirements of all applicable state andfederal securities laws in connection with such issuance and sale orexchange; and further

RESOLVED, that the Company is hereby authorized to enter into suchcredit support or enhancement agreements or arrangements and anyamendments thereto or renewals thereof, in connection with the issuanceand sale or exchange of said Debt Securities as an Authorizing Officershall approve after first determining that such agreements or arrangementsare necessary or appropriate in the circumstances; and further

Page 4

RESOLVED, that each Authorizing Officer is hereby authorized andempowered, in the Company's name and on its behalf, (i) to fix, orestablish the procedure for fixing, the terms of any of the Debt Securities,to approve and execute an indenture or indentures, including supplementsor amendments thereto, and forms of notes or bonds and other agreementsrelated thereto, and to take all such other action or actions as it may deemnecessary or appropriate to facilitate the issuance and sale or exchange ofthe Debt Securities (including, without limitation, approval of any creditsupport or enhancement agreements or arrangements relating to paymentsin respect of the Debt Securities), provided that a) the interest rate on theDebt Securities, if fixed, shall not exceed 10 percent and, b) if variable,shall at the time of issuance of such Debt Securities not be greater than 10percent, and (ii) to approve the listing of any or all such Debt Securities onany United States or foreign securities exchanges (including, withoutlimitation, approval of the amount of such Debt Securities to be so listed).

C. Regulatory Approvals for Financing

RESOLVED, that the officers of the Company are hereby authorized, inthe Company's name and on its behalf, to prepare and file with the FederalEnergy Regulatory Commission, California Public Utilities Commission,the Idaho Public Utilities Commission, the Public Utility Commission ofOregon, the Public Service Commission of Utah, the Washington Utilitiesand Transportation Commission and the Wyoming Public ServiceCommission and any other public service commission or federal or stateregulatory authority, as may be appropriate or necessary, applications fororders of said regulatory authorities authorizing, notifying as to, orexempting, the issuance and sale or exchange by the Company of theBonds and/or the Debt Securities (collectively, the "New Securities"),together with any and all amendments to such applications and with anyand all exhibits, data requests or other documents pertaining to suchapplications or any amendments thereto, as in the judgment of suchofficers may appear desirable or appropriate; and further

RESOLVED, that the acts of the officers in filing applications (andamendments and supplements to such applications) with the regulatoryauthorities named in the immediately preceding resolution, together withthe various exhibits to such applications (and such amendments andsupplements), for orders authorizing, notifying as to, or exempting theissuance and sale or exchange of the New Securities are hereby approved,ratified and confirmed; and further

RESOLVED, that the officers of the Company are hereby authorized anddirected, in the Company's name and on its behalf, to make any and allsuch further filings with, and to take any and all such further action in theproceedings before, federal and state regulatory authorities as in thejudgment of the officer or officers taking such action may appear desirable

Page 5

or appropriate for the purpose of obtaining any and all such furtherregulatory approvals, authorizations or consents, or making anynotifications, as may be required to be obtained by the Company inconnection with the consummation of the issuance and sale or exchangeby it of the New Securities; and further

RESOLVED, that each of the Authorizing Officers of the Company ishereby authorized, in the Company's name and on its behalf, to prepareand execute, and to file or cause to be filed, with the Securities andExchange Commission, an appropriate Registration Statement orStatements, each including a Prospectus, for the registration of the NewSecurities or any exchange of New Securities under the Securities Act of1933 and the rules and regulations promulgated thereunder, in such formas they or any of them shall approve, together with any and all suchamendments to each such Registration Statement, and with any and allsuch exhibits, statements or other documents pertaining to the subjectmatter thereof as in the judgment of such officers may appear desirable orappropriate; and further

RESOLVED, that each of Doug Stuver, Bruce Williams and Jeff Erb ishereby appointed as the true and lawful attorney of the Company with fullpower to act with or without the other and with full power of substitution,to sign each such Registration Statement for the registration of the NewSecurities under the Securities Act of 1933 for and on behalf of theCompany, that each director of the Company, and each officer of theCompany who may be required to sign any such Registration Statementand any amendments thereto, is hereby authorized to appoint Doug Stuver,Bruce Williams and Jeff Erb, and each of them severally, as the true andlawful attorney or attorneys of each such director or officer of theCompany, with full power to act with or without the other and with fullpower of substitution, to sign each such Registration Statement and anyamendments thereto for or on behalf of each such director or officer in hisor her capacity or capacities as such, and that the President, any VicePresident and each director of the Company and each officer of theCompany who may be required to sign any such Registration Statementand any amendments thereto, is hereby authorized and empowered toexecute an appropriate power of attorney to evidence such appointmentsas aforesaid; and further

RESOLVED, that Doug Stuver or any other officer designated by anAuthorized Officer, be and hereby is appointed as the agent for servicenamed in each such Registration Statement with all the powers incident tothat appointment; and further

RESOLVED, that it is desirable and in the best interests of the Companythat its securities be qualified or registered for sale in various jurisdictions,that the President, any Vice President or the Treasurer and the Secretary or

Page 6

any Assistant Secretary hereby are authorized to determine the states inwhich appropriate action shall be taken to qualify or register or maintainthe qualification or registration for sale of all or such part of the securitiesof the Company as said officers may deem advisable, that said officers arehereby authorized to perform on behalf of the Company any and all suchacts as they may deem necessary or advisable in order to comply with theapplicable laws of any such jurisdiction, and in connection therewith toexecute and file all requisite papers and documents, including, but notlimited to, applications, reports, surety bonds, irrevocable consents, andappointments of attorneys for service of process and the execution by suchofficers of any such paper or document or the doing by them of any act inconnection with the foregoing matters shall conclusively establish theirauthority therefor from the Company and the approval and ratification bythe Company of the papers and documents so executed and the action sotaken; and further

RESOLVED, that each of the Authorizing Officers of the Company ishereby authorized, in the Company's name and on its behalf, to negotiatewith agents, underwriters or other purchasers with respect of the terms ofthe issuance and sale or exchange of each offering of the New Securities,and to execute and deliver, in the Company's name and on its behalf, anagreement or agreements with such agents, underwriters or purchasersproviding for such issuance and sale or exchange and containing suchother terms and provisions (including, without limitation, provisions forcompensation, discounts or indemnification of such parties) as shall beapproved by the officer or officers executing such agreement oragreements, his, her or their execution thereof to be conclusive evidenceof such approval.

D. Effect on Prior Resolutions

RESOLVED, that the foregoing resolutions shall supersede the PriorResolutions with respect to the Bonds and Debt Securities, but theforegoing resolutions shall not affect the validity of any actions taken inreliance on such previously adopted resolutions and shall not affect theauthorization of the issuance of $800 million principal amount of Bondsregistered under the Securities Act of 1933 issued pursuant to the TwentySecond Supplemental Indenture (which shall remain authorized pursuantto the Prior Resolutions) and $1,000 million principal amount of Bondsregistered under the Securities Act of 1933 issued pursuant to the TwentyThird Supplemental Indenture (which shall remain authorized pursuant tothe Prior Resolutions).

Page 7

V. General Authorization

RESOLVED, that the Officers and the Board of the Company be, andhereby are, authorized, empowered and directed, in the name and onbehalf of the Company, to make all such arrangements, to take all suchfurther action, to cause to be prepared and filed any documents, to makeall expenditures and incur all expenses and to execute and deliver, in thename of and on behalf of the Company, any agreements, instruments,certificates and documents (including without limitation officers'certificates) as they may deem necessary, appropriate or advisable in orderto fully effectuate the purpose of each and all of the foregoing resolutions,and the execution by such officers of any such agreement, instrument,document or certificate or the payment of any such expenditures orexpenses or the doing by them of any act in connection with the foregoingmatters shall conclusively establish their authority therefor from theCompany and the approval and ratification by the Company of theagreement, instrument, document or certificate so executed, the expensesor expenditures so paid and the action so taken; and be it further

RESOLVED, that any and all actions heretofore taken by the officers orthe Board of the Company in connection with the matters contemplated bythe foregoing resolutions, including without limitation the actions andmatters authorized herein and all related documents, instruments andagreements, be, and hereby are, approved, confirmed and ratified in allrespects.

Page 8

EXHffiITE

EXHIBITE

PACIFICORPUNCONSOLIDATED BALANCE SHEET

SEPTEMBER 30, 2009

ASSETS AND OTHER DEBITS TOTAL CORPORATION PROPOSED FINANCING TOTAL PROFORMA

UTILITY PLANTELECTRIC PLANT IN SERVICE (101) 19,335,764,488.03 19,335,764,488.03PROPERTY UNDER CAPITAL LEASES 1101.1) 65,631,518.34 65,631,518.34ELECTRIC PLANT PURCHASED OR SOLD 102 0.00 0.00EXPERIMENTAL ELECTRIC PLANT - UNCLASSIFIED (103) 0.00 0.00ELECTRIC PLANT HELD FOR FUTURE USE (105) 13,709,211.10 13,709,211.10COMPLETED CONSTRUCTION NOT CLASSIFIED (106) 49,461,848.32 49,461,848.32CONSTRUCTION WORK IN PROGRESS - ELECTRIC (107) 1,590,374,104.09 1,450,586,625.00 3,040,960,729.09ELECTRIC PLANT ACQUISITION ADJUSTMENTS (114) 157,193,779.75 157,193,779.75OTHER UTILITY PLANT (118) 0.00 0.00NUCLEAR FUEL (120.1-120.4) 0.00 0.00

TOTAL UTILITY PLANT 21,212,134,949.63 1,450,586,625.00 22,662,721,574.63

ACCUM PROV FOR DEPR OF ELECT PLANT IN SERViCE (108) CR 6,603,441,059.34 6,603,441,059.34ACCUM PROV FOR AMORT OF ELECT PLANT IN SERVICE (111) CR 433,091,339.26 433,091,339.26ACCUM PROV FOR ASSET ACQUISITION ADJUSTMENT (115) CR 94,957,034.66 94,957,034.66ACCUM PROV FOR DEPR OF OTHER UTILITY PLANT (119) CR 0.00 0.00ACCUM PROV FOR AMORT OF NUCLEAR FUEL ASSEMB (120.5) CR 0.00 0.00

UTILITY PLANT - NET 14,080,645,516.37 1,450,586,625.00 15,531,232,141.37

NONUTILITY PROPERTY AND INVESTMENTSNONUTILITY PROPERTY (121) 9,804,451.48 9,804,451.48ACCUM PROV FOR DEPR/AMORT OF NONUTILITY PROP (122) CR 1,411,184.77 1,411,184.77INVESTMENT IN ACCOCIATED COMPANIES (123) 10,722,236.35 10,722,236.35INVESTMENT IN SUBSIDIARY COMPANIES (123.1) 183,520,817.46 183,520,817.46OTHER INVESTMENTS 11241 82,652,122.78 82,652,122.78OTHER SPECIAL FUNDS (128) 8,373,542.18 8,373,542.18LONG-TERM PORTION OF DERIVATIVE INSTRUMENT ASSETS (175) 47,225,702.13 47,225,702.13

TOTAL NONUTILITY PROPERTY & INVESTMENTS 340,887,687.61 0.00 340,887,687.61

CURRENT AND ACCRUED ASSETSCASH (131) 8.678.697.53 0.00 8678,697.53SPECIAL DEPOSITS 1132-134) 759,790.00 759790.00WORKING FUNDS (135) 1,920,00 1,920.00TEMPORARY CASH INVESTMENTS (136) 98,815,446.69 (80,432,164.74) 18,383,261.95NOTES RECEIVABLE (141) ?L!'; QQ 542,246.99CUSTOMER ACCOUNTS RECEIVABLE (142) 315,101,943.22 315,101,943.22OTHER ACCOUNTS RECEIVABLE (143) 23,685,702.02 23,685,702.02ACCUMULATED PROV FOR UNCOLLECTIBLE ACCOUNTS (144) CR (8,424,342.91) (8,424,342.91 )NOTES RECEIVABLE FROM ASSOCIATED COMPANIES (145) 7,676,740.61 7,676,740.61ACCOUNTS RECEIVABLE FROM ASSOCIATED COMPANIES (146) 24,899,306.56 24,899,306.56FUEL STOCK (151-1521 154,865,746.69 154,865,746.69MATERIALS AND SUPPLIES 1154-163) 177,522,023.57 177,522,023.57PREPAYMENTS (165) 192,112,509.51 192,112,509.51INTEREST AND DIVIDENDS RECEIVABLE (171) 14,999.48 14,999.48RENTS RECEIVABLE (172) 2,191,215.17 2,191,215.17ACCRUED UTILITY REVENUES (173) 198,863,000.00 198,863,000.00MISCELLANEOUS CURRENT AND ACCRUED ASSETS (174) 61,280,139.00 61,280,139.00CURRENT PORTION OF DERIVATIVE INSTRUMENT ASSETS (175) '163,575,749,88 163,575,749.88LONG-TERM PORTION OF DERIVATIVE INSTRUMENT ASSETS (175) (47,225,702.13) 147,225,702.13)DERIVATIVE INSTRUMENT ASSETS - HEDGES (176) (4,026,375.58) (4,026,375.58)

TOTAL CURRENT AND ACCRUED ASSETS 1,370,910,756.30 (80,432,184.74 1,290,478,571.56

DEFERRED DEBITSUNAMORTIZED DEBT EXPENSE (181) 36,648,51985 19,333,333.33 55,981,853.18EXTRAORDINARY PROPERTY LOSSES 1182.1) 0.00 0.00UNRECOVERED PLANT AND REGULATORY STUDY COSTS (182.2) 6,576,62537 6,576,625.37OTHER REGULATORY ASSETS (182.3) 1,445,809,428.54 1,445,809,428.54PRELIMINARY SURVEY & INVESTIGATION CHARGES (183) 2,797,885.64 2,797,885.64CLEARING ACCOUNTS (184) 0.00 0.00TEMPORARY FACILITIES (185) 67,576.54 67,576.54MISCELLANEOUS DEFERRED DEBITS (186) 63,969,730.88 63,969,730.88RESEARCH DEVELOPMENT DEMONSTRATION EXPENDITURES (188) 0.00 0.00UNAMORTIZED LOSS ON REACQUIRED DEBT (189) 14,393,95679 14,393,956.79ACCUMULATED DEFERRED INCOME TAXES (190) 776,623,977.39 776,623 977.39

TOTAL DEFERRED DEBITS 2,346,887,701.00 19,333,333.33 2,366,221,034.33

TOTAL ASSETS AND OTHER DEBITS 18,139,331,661.28 1,389,487,773.59 19,528,819,434.87

SEE PACIFICORP'S 2008 FERC FORM NO.1 AND 2009/Q3 FERC FORM 3-Q FOR THE NOTES TO THE FINANCIAL STATEMENTS

EXHIBIT EPAGE 1 OF 2

EXHIBITE

PACIFICORPUNCONSOLIDATED BALANCE SHEET

SEPTEMBER 30, 2009

LIABILITIES AND OTHER CREDITS TOTAL CORPORATION PROPOSED FINANCING TOTAL PROFORMA

CAPITALIZATION

COMMON EQUITYCOMMON STOCK ISSUED (201) 3,417,945,896.24 3,417,945,896.24COMMON STOCK LIABILITY FOR CONVERSION (203) 0,00 0,00PREMIUM ON CAPITAL STOCK (207) 0,00 0,00OTHER PAID-IN CAPITAL (208-211) 877 063,956,38 877,063,956.38INSTALLMENTS RECEIVED ON CAPITAL STOCK (212\ 0.00 0.00CAPITAL STOCK EXPENSE (214) DR 41,288,206,75 41,288,206.75RETAINED EARNINGS (215.1, 216) 2,087,635,173.46 2,624,532,22 2,090,259,705.68REACQUIRED CAPITAL STOCK (217) 0.00 0.00ACCUMULATED OTHER COMPREHENSIVE INCOME (219) (4,947,34782) (4,947,347.82

TOTAL COMMON EQUITY 6,336,409,471.51 2,624,532,22 6,339,034,003.73

PREFERRED STOCK ISSUED (204) 41,463,300,00 41,463,300.00

LONG-TERM DEBTBONDS (221) 6,385,797,000,00 1,385,258,000.00 7,771,055,000.00POLLUTION CONTROL FUNDS ON DEPOSIT WITH TRUSTEE (221.4, 5) 0,00 0.00ADVANCES FROM ASSOCIATED COMPANIES (223\ 0,00 0.00OTHER LONG-TERM DEBT (224) 0,00 0.00UNAMORTIZED PREMIUM ON LONG-TERM DEBT (225) 36,242.40 36,242.40UNAMORTIZED DISCOUNT ON LONG-TERM DEBT (226) DR 15,671,54526 15,671,545.26

TOTAL LONG-TERM DEBT 6,370,161,697,14 1,385,258,000.00 7,755,419,697.14

TOTAL CAPITALIZATION 12,748,034,468,65 1,387,882,532.22 14,135,917,000,87

OTHER NONCURRENT LIABILITIESOBLIGATIONS UNDER CAPITAL LEASES (227) 57,862,750.53 57,862,750.53ACCUMULATED PROVISION FOR PROPERTY INSURANCE (228.1) 0,00 0.00ACCUMULATED PROVISION FOR INJURIES & DAMAGES (228.2) 9,099,205,68 9,099,205,68ACCUMULATED PROVISION FOR PENSIONS & BENEFITS (228,3) 555,741,813,99 555,741,813.99ACCUMULATED MISCELLANEOUS OPERATING PROVISIONS (228.4) 41,765,555,87 41,765,555,87ACCUMULATED PROVISION FOR RATE REFUNDS (229\ 0,00 0,00LONG-TERM PORTION OF DERIVATIVE INSTRUMENT LIABILITIES (244\ 351,070,771.09 351,070,771.09ASSET RETIREMENT OBLIGATION (230) 102,493,708.68 102,493,708,68

TOTAL OTHER NONCURRENT LIABILITIES 1,118,033,805.84 0.00 1,118,033,805,84

CURRENT AND ACCRUED LIABILITIESNOTES PAYABLE (231\ 0.00 0.00ACCOUNTS PAYABLE (232) 560,676,518,26 560,676,518.26NOTES PAYABLE TO ASSOCIATED COMPANIES (233) 0,00 0.00ACCOUNTS PAYABLE TOASSOCIATED COMPANIES (234) 15,621,478,69 15,621,478.69CUSTOMER DEPOSITS (235) 32,596,615.50 32,596,615.50TAXES ACCRUED (236) 68,437,058.54 1,605,241.38 70,042,299.92INTEREST ACCRUED (237) 105,864,647,16 105,864,647.16DIVIDENDS DECLARED (238) ~?() Q, &c' 520,947.43MATURED LONG-TERM DEBT (239\ 0.00 0.00MATURED INTEREST (240) 0,00 0,00TAX COLLECTIONS PAYABLE (241) 15,870,445.54 15,870,445.54MISCELLANEOUS CURRENT AND ACCRUED LIABILITIES (242) 60,076,361.70 60,076,361.70OBLIGATIONS UNDER CAPITAL LEASES (243\ 3,015,042,30 3,015,042.30DERIVATIVE INSTRUMENT LIABILITIES (244) 444,835,569,68 444,835,569.68CURRENT PORTION OF DERIVATIVE INSTRUMENT LIABILITIES (244) (351,070,771,09) (351,070,771,09DERIVATIVE INSTRUMENT LIABILITIES - HEDGES (245) 94,913,00 94,913,00

TOTAL CURRENT AND ACCRUED LIABILITIES 956,538,826.71 1,605,241.38 958,144,068.09

DEFERRED CREDITSCUSTOMER ADVANCES FOR CONSTRUCTION (252\ 14,422,'771.21 14,422,771.21OTHER DEFERRED CREDITS (253) 40,246,337,09 40,246,337,09OTHER REGULATORY LIABILITIES (254) 73,813,205.99 73,813,205.99ACCUMULATED DEFERRED INVESTMENT TAX CREDITS (255) 46,873,758,00 46,873,758.00UNAMORTIZED GAIN ON REACQUIRED DEBT (257\ 0.00 0.00ACCUM DEFERRED INCOME TAXES - ACCEL AMORTIZTN (281) 0.00 0,00ACCUM DEFERRED INCOME TAXES-OTHER PROPERTY (282) 2,674,719,077.00 2,674,779,077.00ACCUMULATED DEFERRED INCOME TAXES-OTHER (283\ 466,589,410.79 466,589,410,79

TOTAL DEFERRED CREOITS 3,316,724,560.08 0.00 3,316,724,560.08

TOTAL LIABILITIES AND OTHER CREDITS 18,139,331,661.28 1,389,487,773.59 19,528,819434.87

SEE PACIFICORP'S 2008 FERC FORM NO. I AND 2009/Q3 FERC FORM 3-Q FOR THE NOTES TO THE FINANCIAL STATEMENTS

EXHIBITEPAGE20F 2

PacifiCorpPro Forma Issuance of $2.0 billion of long-term Debt

Proposed Journal Entries for the 12 Months Ended September 30, 2009

CashUnamortized Debt Expense

BondsProceeds of issuing $2.0 billion in long-term debt

131181221

1,980,000,000

Bonds 221 614,742,000Cash 131

Proceeds ofbond issuance used to finance long-term debt maturities (for scheduled maturitiesfrom 10/1/09 through 12/31/11)

614,742,000

Construction Work In ProgressCash

107131

1,365,258,0001,365,258,000

Remaining proceeds of bond issuance used to finance additional capital spending

Interest on Long-Term DebtTemporary Cash Investments

Interest on $2.0 billion bond issuance

Amortization of Debt ExpenseUnamortized Debt Expense

Amortization of debt expense for new issuance

427/216136

428/216181

666,667

125,000,000

666,667

Temporary Cash Investments 136Interest on Long-Term Debt 427/216

Reduced interest from maturing bonds replaced by new issuance

44,567,81544,567,815

Construction Work In ProgressAFUDC - borrowed funds

Capitalized interest from increased CWIP

Income Taxes - FederalIncome Taxes - State

Taxes AccruedNet tax effect ofabove interest expense amounts

107432/216

409/216409/216

236

85,328,625

1192,032

1,605,241

PacifiCorpPro Forma Issuance of $2.0 billion of Long-term Debt

Pro Forma Assumptions:1) Proceeds of long-term debt issuance used to replace maturing long-term debt and finance

capital expenditures.2) Assumed 30 year long-term debt issuance at 6.25% interest rate with 1.0% issuance costs.3) For purposes of pro forma statements, the allowance for borrowed funds used during construction

rate assumed equal to rate for new bond issuance used to finance new capital spending.4) Scheduled long-term debt maturities through 12/31/11:

MaturityAmount Rate Date Annual Interest

$4,391,000 8.271% 10101/09 363,179.61351,000 7.978% 10101/09 28,002.78

1,462,000 8.493% 10101/09 124,167.661,095,000 8.797% 10101/09 96,327.151,726,000 8.734% 10101/09 150,748.842,587,000 8.294% 10101/09 214,565.78

944,000 8.635% 10101/09 81,514.40898,000 8.470% 10101/09 76,060.60

$13,454,000 $1,134,566.82

4,754,000 8.271% 10101/10 393,203.34381,000 7.978% 10101/10 30,396.18

1,588,000 8.493% 10101/10 134,868.841,193,000 8.797% 10101/10 104,948.211,878,000 8.734% 10101/10 164,024.522,803,000 8.294% 10101/10 232,480.821,028,000 8.635% 10101/10 88,767.80

977,000 8.470% 10101/10 82,751.90

$14,602,000 $1,231,441.61

8,000,000 9.150% 08/09/11 732,000.0025,000,000 8.950% 09/01/11 2,237,500.0020,000,000 8.950% 09/01/11 1,790,000.0020,000,000 8.920% 09/01/11 1,784,000.00

412,000 7.978% 10101/11 32,869.361,723,000 8.493% 10/01/11 146,334.391,298,000 8.797% 10/01/11 114,185.062,042,000 8.734% 10/01/11 178,348.283,036,000 8.294% 10101/11 251,805.841,116,000 8.635% 10/01/11 96,366.601,059,000 8.470% 10/01/11 89,697.30

500,000,000 6.900% 11/15/11 34,500,000.003,000,000 8.290% 12/30/11 248,700.00

$586,686,000 $42,201,806.83

$614,742,000 $44,567,815.26

5) Effective federal income tax rate of 33.411 % and effective state tax rate of 4.540%.

EXHmITF

Legal Matters

PacifiCorp is party to a variety of legal actions arising out of the normal course of business. Plaintiffs occasionally seekpunitive or exemplary damages. PacifiCorp does not believe that such normal and routine litigation will have a materialeffect on its consolidated fmancial results. PacifiCorp is .also involved in other kinds of legal actions, some of which assert ormay assert claims or seek to impose fmes and penalties in substantial amounts and are described below.

In February 2007, the Sierra Club and the Wyoming Outdoor Council filed a complaint against PacifiCorp in the federaldistrict court in Cheyerme, Wyoming, alleging violations of the Wyoming state opacity standards at PaciflCorp'S Jim Bridgerplant in Wyoming. Under Wyoming state requirements, which are part of the Jim Bridger plant's Title V pennit and areenforceable by private citizens under the federal Clean Air Act, a potential source of pollutants such as a coal·firedgenerating facility must meet minimum standards for opacity, which is a measurement of light that is obscured in the flue of agenerating facility. The complaint alleges thousands of violations of asserted six-minute compliance periods and seeks aninjunction ordering the Jim Bridger plant's compliance with opacity limits, civil penalties of $32,500 per day per violationand the plaintiffs' costs of litigation. The court granted a motion to bifurcate the trial into separate liability and remedyphases. In August 2009, the court ruled on a number of summary judgJ,'llent motions by which it determined that the plaintiffshave sufficient legal standing to proceed with their complaint and that all other. issues raised in the summary judgmentmotions will be resolved at trial. The court also set a scheduling conference for Decemher 2009. PacifiCorp believes it has anumber of defenses to the claims. PacifiCorp intends to vigorously oppose the lawsuit but carmot predict its outcome at thistime. PacifiCorp has already committed to invest at least $812 million in pollution control equipment at its generatingfaoilities, including the Jim Bridger plant. This commitment is expected to significantly reduce system-wide emissions,including emissions at the Jim Bridger plant.

Environmental Matters

PacifiCorp is subject to federal, state and local laws and regulations regarding air and water quality, hazardous and solid.waste disposal, protected species and other en¥ironmental matters that have the potential to impact PacifiCorp's current and .future operations. PacifiCorp believes it is in material compliance with current environmental requirements.

New Source Review

As part of an industry-wide investigation to assess compliance with the New Source Review ("NSR") and Prevention ofSignificant Deterioration ("PSD") provisions, the United States Environmental Protection Agency (the "EPA") has requestedfrom numerous utilities information and supporting documentation regarding their capital projects for various generatingfacilities: Between 2001 and 2003, PacifiCorp responded to requests for information relating to its capital projects at itsgenerating facilities, and it has been engaged in periodic discussions with the EPA over several years regarding its historicalprojects and their compliance with NSR and PSD provisions. An 'NSR enforcement case against another utility has beendecided by the United States Supreme Court, holding that an increase in armual emissions of a generating facility, whencombined with a modification (I.e., a physical or operational change), may trigger NSR permitting. PacifiCorp could berequired to install additional emissions controls, and incur additional costs and penalties, in the event it is determined thatPacifiCorp's historical projects· did not meet all regulatory requirements. The impact of these additional emissions controls,costs and penalties, if any, on PacifiCorp's consolidated fmancia\ results cannot be determined at this time.

..

Accrued Environmental Costs

PacifiCorp is fully or partly responsible for environmental remediation at various contaminated sites, including sites that areor were part of PacifiCorp's operations and sites owned by third parties.PacifiCorp accrues environmental remediationexpenses when the expenses are believed to be probable and can be reasonably estimated. The quantification ofenvironmental exposures is based on many factors, including changing laws and regulations, advancements in environmentaltechnologies, the quality of available site-specific information, site investigation results, expected remediation or settlementtimelines, PacifiCorp's proportionate responsibility, contractual inderonities and coverage provided by insurance policies,The liability recorded as of September 30, 2009 and as of December 31, 2008 was $16 million and $26 million, respectively,and is included in other current liabilities and other long-term liabilities on the Consolidated Balance Sheets, Environmentalremediation liabilities that separately result from the normal operation of long-lived assets and that are legal obligationsassociated v;rith the retirement of those assets are separately accounted for as asset retirement obligations, .

Climate Change

In June 2009, the United States House of Representatives passed the American Clean Energy and Security Act of 2009("Waxman-Markey bill"), introduced by Representatives Henry Waxman and Edward Markey, In addition to a federalrenewable portfolio standard, which would require utilities to obtain a portion of their energy from. certain qualifyingrenewable sources, and energy efficiency measures, the bill reqilires a reduction in greenhouse gas emissions beginning in·2012, with emission reduction targets of 3% .below 2005 levels by 2012; 17% below 2005 levels by 2020; 42% below 2005levels by 2030; and 83% below 2005 levels by 2050 under a "cap and trade" program. In September 2009, a similar bill wasintroduced in the United States Senate by Senators Barbara Boxer and John Kerry, which would require a reduction ingreenhouse gas emissions beginning in 2012 with emission reduction targets consistent with the Waxman-Markey biU, withthe exception of the 2020 target, which requires 20% reductions below 2005 levels, If the Waxman-Markey bill or someother federal comprehensive climate change bill were to pass both Houses of Congress and be signed into law by thePresident, the impact on PacifiCorp's fmancial performance could be material and would depend on a number of factors,including the required timing and level of greenhouse gas reductions, the price and availability of offsets and allowances usedfor compliance and the ability of PacifiCorp to receive revenue from customers for increased costs. The new law would likelyresult in increased operating costs and expenses, additional capital expenditures and retirements of existing assets and maynegatively impact demand for electricity, PacifiCorp expects it v;rill be allowedto recover the costs to comply with climatechange requirements.

Hydroelectric Relicensing

PacifiCorp's hydroelectric portfolio consists of 47 generating facilities v;rith an aggregate facility net owned capacity of1,158 megawatts ("MW"). The Federal Energy Regulatory Commission (the "PERC") regulates 98% of the net capacity ofthis portfolio through 16 individuallicenses, which typically have terms of 30 to 50 years. PacifiCorp is currently activelyengaged in the relicensing process v;rith the PERC for its Klamath hydro~lectric system.

In February 2004, PacifiCorp filed with the FERC afinal application for a new license to operate the 169·MW Klamathhydroelectric system in anticipation of the March 2006 expiration of the existing license. PacifiCorp is currently operatingunder an annual license issued by the PERC and expects to continue operating under annual licenses until the relicensingprocess is complete. As part of the relicensing process, the FERC is required to perform an environmental review, and inNovember 2007, the PERC issued its fmElI environmental imp~ct statement. The United States Fish and Wildlife Service andthe National Marine Fisheries Service issued fmal biological opinions in December 2007 analyzing the Klamathhydroelectric system's impact on endangered species under a new PERC license consistent with the FERC staffsrecommended license alternative and terms and conditions issued by the United States Departments of the Interior andCommerce. These terms and conditions include construction of upstream and downstream fish passage facilities at theKlamath hydroelectric system's four mainstem dams. PacifiCorp will need to obtain water quality certifications from Oregonand California prior to the PERC issuing a final license. PacifiCorp currently has water quality applications pending inOregon and California. .

In November 2008, PacifiCorp signed a non-binding agreement in principle (the "AIP") that laid out a framework for thedisposition of PacifiCorp's Klamath hydroelectric system relicensing process, including a path toward dam transfer andremoval by an entity other than PaciftCorp nD earlier than 2020. Parties to the AIP are PacifiCorp, the United StatesDepartment of the Interior, the State of Oregon and the State of California. Any transfer of facilities and subsequent removalare contingent on PacifiCorp reaching a comprehensive final settlement with the AIP signatories and other stakeholders. Asprovided in the AIP, PacifiCorp's support for a defmitive settlement will depend on a variety of factors, including theprotection for PacifiCorp and its customers from uncapped dam removal costs and liabilities.

The AIP includes provisions to:

• Perform studies and implement certain measures designed to benefit aquatic species and their habitat in theKlamath Basin;

• Support and implement legislation in Oregon authorizing a customer surcharge intended to cover potential damremoval; and .

• Require parties to support proposed federal legislation introduced to facilitate a final agreement.

AssUlJring a final agreement is reached, the United States government will conduct scientific and engineering studies andconsult with state, .local and tribal governments and other stakeholders, as appropriate, to determiDe by March 31, 2012whether the benefits of dam remova,l will justify the costs.

In addition to signing the AlP, PacifiCorp provided both the United States Fish and Wildlife Service and the National MarineFisheries Service an interim conservation plan aimed at providing additional protections for endangered species in theKlamath Basin. PacifiCorp is collaborating with both agencies to implement the plan.

PacifiCorp has participated in ongoing negotiations since the AIP was signed in November 2008 to arrive at a draft of thefinal settlement agreement. The Klamath settlement parties voted to release in September 2009 a public review draft of thefinal settlement agreement, which is consistent with the AIP framework. The parties will review the draft of the fmalsettlement agreement, and expect to sign a fmal settlement agreement by the end of2009.

In July 2009, ~gon's governor signed a bill authorizing PacifiCorp to collect surcharges from its Oregon customers forOrl,lgon's share of the customer contribution identified in the .AIP for the cost of removing the Klamath River dams.According to the AIP, the total amount to be collected from PacifiCorp's custQmers is capped at $200 million. Of thisamount, up to $180 million would be collected from PacifiCorp's Oregon customers with the remainder to be collected fromPacifiCorp's California customers.

Hydroelectric relicensing and the related environmental compliance requirements and litigation are subject to uncertainties.PacifiCorp expects that future costs relating to these matters will be significant and will consist primarily of additionalrelicensing costs, as well as ongoing operations and maintenance. expense and capital expenditures required by itshydroelectric licenses. Electricity generation reductions may result from the additional environmental requirements.PacifiCorp had incurred $65 million and $57 million in costs, included in construction work-in-progress and reflected inproperty, plant and equipment, net on the Consolidated Balance Sheets, as of September 30, 2009 and December 31, 2008,respectively, for ongoing hydroelectric relicensing. While the costs of implementing new license ,provisions cannot bedetermined until such time as a new license is issued, such costs could be material. .

IiIiII

I!j!!

I!

il

Ii

FERCIssues

FERC Investigation

During 2007, the Western Electricity Coordinating Council (the "WECC") audited PacifiCorp's compliance with several ofthe reliability standards developed by the North American Electric Reliability Corporation (the "NERC"). In April 2008,PacifiCorp reCeived notice of a prelimina.ry non-public investigation from the FERC and the NERC to detennine whether anoutage that occurred in PacifiCorp's transmission system in February 2008 involved any violations ofreliabiUty standards. InNovember 2008, PacifiCorp received preliminary fmdings from the PERC staff regarding its non-public investigation into theFebruary 2008 outage. Also in November 2008, in conjunotion -with the reliability standards review, the PERC assumedcontrol of certain aspects of the WECC's 2007 andit. PacifiCorp has engaged in discussions with PERC staff regarding'fmdings related to the WECC audit and the non-public investigation. Howevor, PacifiCorp carmot predict the impact of theaudit or the non-public investigation on its consolidated financial results at ~s time.

Northwest Refund Case

In June 2003, the PERC terminated its proceeding relating to the possibility of requiring refunds for wholesale spot-marketbilateral sales in the PacifiC Northwest between Decemb~ 2000 and June 2001. The PERC concluded that ordering refundswould not be an appropriate resolution of the matter. In November 2003, the PERC issued its fmal order denying rehearing,Several market participants, excluding PacifiCorp, filed petitions in the United States Court of Appeals for the Ninth Circuit(the "Ninth Circuit") for review of the FERC's fmal order. In August 2007, the Ninth Circuit concluded that the FERC failedto adequately explain how it considered or examined new evidence showing intentional market manipulation in Californiaand its potential ties to the Pacific Northwest, and that the FERC should not have excluded from the Pacific Northwest refundproceeding purohases of energy in the Pacific Northwest spot market made by the California Energy Resources Scheduling("CERS'') division of the California Department of Water Resouroes. Without issuing the mandate order, the Ninth Circuitremanded the case to the FERC to (i) address the new market manipulation evidence in detail and account for it in any futureorders regarding the -award or denial of refunds in the proceedings, '(ii) include saIes to CERS in its analysis and (iii) furtherconsider its refund decision in light of related, intervening opinions of the court. The Ninth Circuit offered no opinion on the,FERC's findings based on the record established by the administrative law judge and did not rule on the merits ofthelPERC's November 2003 decision to deny refunds. In April 2009, the Ninth Circuit issued a formal mandate order,completing the remand of the case to theFERC, which has not yet undertaken further action. PacifiCorp cannot predict thefuture course of this proceeding and its impact on its consolidated financial results, if any, at this time.

EXHIBITG

EXHIBITG

PACIFICORPUNCONSOLIDATED STATEMENT OF INCOME

UTILITY OPERATING INCOMEOPERATING REVENUESOPERATION AND MAINTENANCE EXPENSE

OPERATIONMAINTENANCE

TOTAL OPERATION AND MAINTENANCE EXPENSEDEPRECIATIONAMORTIZATIONTAXES OTHER THAN INCOME TAXESCURRENT INCOME TAXESPROVISION FOR DEFERRED INCOME TAXESINVESTMENT TAX CREDIT ADJUSTMENTS -- NETGAINS FROM DISPOSITION OF UTILITY PLANT CRLOSSES FROM DISPOSITION OF UTILITY PLANTGAINS FROM DISPOSITION OF ALLOWANCES CRACCRETION EXPENSE

UTILITY OPERATING INCOMEOTHER INCOME AND DEDUCTIONS

OTHER INCOMEINCOME FROM MERCHANDISINGINCOME FROM NONUTILITY OPERATIONSNONOPERATING RENTAL INCOMEEQUITY IN EARNINGS OF SUBSIDIARIESINTEREST AND DIVIDEND INCOMEALLOW FOR FUNDS USED DURING CONSTRUCTIONMISCELLANEOUS NONOPERATING INCOMEGAIN ON DISPOSITION OF PROPERTY

TOTAL OTHER INCOMEOTHER INCOME DEDUCTIONS

LOSS ON DISPOSITION OF PROPERTYMISCELLANEOUS AMORTIZATIONMISCELLANEOUS INCOME DEDUCTIONS

TOTAL OTHER INCOME DEDUCTIONSTAXES APPLIC TO OTHER INCOME & DEDUCTIONS

TAXES OTHER THAN INCOME TAXESINCOME TAXESDEFERRED INCOME TAXESINVESTMENT TAX CREDITS

TOTAL TAXES APPLIC TO OTHER INC & DEDNET OTHER INCOME AND DEDUCTIONS

INCOME BEFORE INTEREST CHARGESINTEREST CHARGES

INTEREST ON LONG-TERM DEBTAMORTIZATION OF DEBT DISCOUNT AND EXPENSEAMORTIZATION OF LOSS ON REACQUIRED DEBTAMORTIZATION OF PREMIUM ON DEBTAMORTIZATION OF GAIN ON REACQUIRED DEBTINTEREST ON DEBT TO ASSOCIATED COMPANIESOTHER INTEREST EXPENSEALLOW FOR BRD FUNDS USED DURING CONSTR

NET INTEREST CHARGESINCOME BEFORE EXTRAORD. ITEMS

EXTRAORDINARY ITEMS -- NET OF INCOME TAXINCOME TAX ON CUM. EFFECT OF CHANGE IN ACCT. PRINCCUMULATIVE EFFECT OF CHANGE IN ACCT. PRINCIPLE

NET INCOMEPREFERRED DIVIDEND REQUIREMENTS

EARNINGS AVAILABLE FOR COMMON STOCK

TOTAL CORPORATION

A'lOR nn II' '7.48

2,317,021.002.59

2,707,953,482.48460.207,

47. i'Jn

(284,627,

0000.00

7,487,891.21000

800,376,527.44

6

166,872,597.80

234,516611,257,802,06

47,177,604.02

40,4.

(2 IY42,186,356.6877,508,637.10

877,885,164.54

358,51

30(

(

363,725,205.29514,159,959.25

0.000.00

514,159,959.252,083,789.72

512,076 16953

PROPOSED FINANCING

0.00

1,605,241.38

(1,605,241.38)

0.00

0.00

0.000.00

(1,605,241.38)

80.432,184.74

(4,229,773.592,624,532.22

2,624,532.22

2,624,532.22

TOTAL PROFORMA

4,306,400,477.48

2,317,021,002.59390,932,479.89

2,707 953,482.48460,207,693.30

47,120,555.91116,734,549.29

(283,022,502.91)467,948,872.56

(1,825,56800)0.000.00

7,487,891.210.00

798,771,286.06

(32,586.84)197,949.8667,732.76

1,504,182.6142,949,384.0061,000,695.7059,094,820.43

2,090,419.28166,872,597.80

234,516.611,257,802.06

45,685,285.3547,177,604.02

326,294.6840,196,502.00

4,571,319.00(2,907,759.00)

42,186,356.6877,508,637.10

876,279,923.16

438,993,503.024,295,005.303,009,191.25

(2,718.18)0.00

(9.65)34,559,733.63

(121,359,273.67)359495,431.70516,784,491.47

0.000.00

516,784,491.472,083,789.72

514,700,701.75

EXHIBIT GPAGE 1 OF 1

SEE PACIFICORP'S 2008 FERC FORM NO.1 AND 2009/Q3 FERC FORM 3-Q FOR THE NOTES TO THE FINANCIAL STATEMENTS

EXHIBITH

EXHIBITH

PACIFICORPPRO FORMA UNCONSOLIDATED STATEMENT OF RETAINED EARNINGS

12 MONTHS ENDED SEPTEMBER 30, 2009

TOTAL CORPORATION PROPOSED FINANCING TOTAL PROFORMA

RETAINED EARNINGS 215,215.1,216,216.1BALANCE AT BEGINNING OF PERIOD 1,576,925,268.12 1 576,925,268.12NET INCOME 514,159959.25 2,624,532.22 516,784491.47ADJUSTMENT TO RETAINED EARNINGS PENSION

MEASUREMENT DATE CHANGE 1 366264.19 1,366,264.19SUBTOTAL 2,089718,963.18 2,624,532.22 2,092,343,495.40

DIVIDENDS DECLAREDPREFERRED STOCK 2083789.72 2,083,789.72COMMON STOCK 000 0.00

BALANCE AT END OF PERIOD 2,087,635,173.46 2,624,532,22 2,090,259,705,68

SEE PAClFICORP'S 2008 FERC FORM NO.1 AND 2009/Q3 FERC FORM 3-Q FOR TIfE NOTES TO THE FrNANCIAL STATEMENTS

EXHIBIT HPAGE 101" 1

EXHmITM

MONTANA

ARI ZO N A

COLORADO

NEW MEXICO

EXHmITN

Exhibit N

Fixed-Rate Spreads

As provided in the Company's Application, the following maximum total spreads overtreasury yields represent alternate limitations from the 9.0 percent per annum cost to maturitylimitation.

Interest rate on First Mortgage Bonds:

The interest rate on Bonds will be determined at the time of issuance. The proposedmaximum Spread over the applicable treasury security for various maturities is listed below.The Bonds may have a feature that allows redemption prior to maturity at specified prices.

Greater Thanor Equal To

9 months

2 years

3 years

4 years

6 years

9 years

10 years

11 years

15 years

20 years

30 years or more

Less Than

2 years

3 years

4 years

6 years

9 years

10 years

11 years

15 years

20 years

30 years

Maximum Spread Over

Benchmark Treasury Yield 1

+ 185 basis points

+ 195 basis points

+ 210 basis points

+ 220 basis points

+ 230 basis points

+ 250 basis points

+ 260 basis points

+ 265 basis points

+ 270 basis points

+ 280 basis points

+ 290 basis points

IThe Benchmark Treasury Yield, with respect to any of the debt securities' maturity range, means the yield tomaturity of that issue of direct obligations of the United States which, out of all actively traded issues of suchobligations with a remaining term to maturity within such debt securities' maturity range, is generally considered bydealers in such obligations to be the standard for such obligations. With respect to the issuance of any of the debtsecurities', the Benchmark Treasury Yield shall be determined as of the time the commitment to purchase such debtsecurities' is received by the Company or its agents.

EXHIBITN

Interest rate on other Debt:

The interest rate on the other Debt will be determined at the time of issuance based upon thencurrent market conditions. The proposed maximum Spread over the applicable treasurysecurity for various maturities is listed below. The Debt may have a feature that allows it tobe redeemed prior to maturity at specified prices.

Greater Than orEqual To

9 months

2 years

3 years

4 years

6 years

9 years

10 years

I I years

15 years

20 years

30 years or more

Less Than

2 years

3 years

4 years

6 years

9 years

10 years

I I years

15 years

20 years

30 years

Maximum Spread Over

Benehmark Treasury Yield I

+ 205 basis points

+ 2 I5 basis points

+ 230 basis points

+ 240 basis points

+ 250 basis points

+ 270 basis points

+280 basis points

+ 285 basis points

+ 290 basis points

+ 300 basis points

+ 310 basis points

'The Benchmark Treasury Yield, with respect to any of the debt securities' maturity range, means the yield tomaturity of that issue of direct obligations of the United States which, out of all actively traded issues of suchobligations with a remaining term to maturity within such debt securities' maturity range, is generally considered bydealers in such obligations to be the standard for such obligations. With respect to the issuance of any of the debtsecurities', the Benchmark Treasury Yield shall be detennined as of the time the commitment to purchase such debtsecurities' is received by the Company or its agents.

EXHIBITN 2

Draft

ORDER NO.---

ENTERED

BEFORE THE PUBLIC UTILITY COMMISSION

OF OREGON

UF _

In the Matter of the Application ofPACIFICORP dbaPACIFIC POWER for authority to (1) issue and sellor exchange not more than $2,000,000,000 of debt,(2) enter into credit support arrangements, (3) enterinto currency swaps, and (4) contribute or selladditional debt to special-purpose entities.

)))))

ORDER

DISPOSITION: APPLICATION APPROVED WITH CONDITIONSAND REPORTING REQUIREMENTS

On [], the Commission received an application from PacifiCorp, d.b.a. Pacific Power

(Company) pursuant to ORS 757.405, ORS 757.410(1), ORS 757.415 and OAR 860-27-0030

requesting authority to: 1) issue and sell or exchange not more than $2,000,000,000 of debt; 2)

enter into credit support arrangements; 3) enter into currency swaps; and 4) contribute or sell

additional debt to special-purpose entities. The requested authority will replace the financing

authority the Commission authorized in Order No. 08-013. The basis for the request is detailed

in Staff s Report, attached as Appendix A, and incorporated by reference.

Based on a review of the application and the Commission's records, the Commission

finds that this application satisfies applicable statutes and administrative rules. At its public

meeting on [ ],2010, the Commission adopted Staffs recommendation and approved

PacifiCorp's request.

DRAFT ORDER

Draft[],2010

ORDER

IT IS ORDERED that the Application ofPACIFICORP for authority to issue and sellor exchange not more than $2,000,000,000 of debt, (2) enter into credit supportarrangements, (3) enter into currency swaps, and (4) contribute or sell additional debtto special-purpose entities is granted, subject to the conditions stated in Appendix A.

Made, entered, and effective , 2010.-----

BY THE COMMISSION:

[Name][Title]

A party may request rehearing or reconsideration of this order pursuant to ORS 756.561. Arequest for rehearing or reconsideration must be filed with the Commission within 60 days of thedate of service of this order. The request must comply with the requirements in OAR 860-0140095. A copy of any such request must also be served on each party to the proceeding asprovided by OAR 860-013-0070(2). A party may appeal this order by filing a petition for reviewwith the Court of Appeals in compliance with ORS 183.480-183-484.

DRAFT ORDER 2

Documents

UF 4262, INITIAL (APPLICATION, COMPLAINT, PETITION), … · 2010-01-21 · creditsupportarrangements, (3) enterinto currency swaps, and (4) contribute orsell additional debtto special-purposeentities