Merger Facts

ISSUE: Customer Impact

“The merger is not about the consumer, but rather a way for management to make money.”

Facts:

• Puget Sound Energy has a significant need for external credit and capital in the decade ahead to meet our growing customer needs, as well as legal and load serving obligations.
• The merger is designed to provide PSE with reliable, committed long-term access to capital on reasonable terms.
• Access to capital will help PSE secure future energy supply and delivery infrastructure for our customers in growing Western Washington.
• The merger agreement reinforces PSE’s commitment to continue to aggressively pursue the acquisition of environmentally sustainable energy resources.
• Puget Holdings LLC, a group of primarily North American investors mainly responsible for managing pension funds seeking long-term returns, supports PSE’s continuing leadership in the region and the advancement of cost effective energy efficiency programs for customers.

“Puget Holdings will recover the transaction premium by charging higher rates.”

Fact:

• The Washington Utilities and Transportation Commission (UTC) and Federal Energy Regulatory Commission (FERC) prohibit the passing on of transaction costs to customers in rates.

“The merger will make rates go up.”

Facts:

• False. The UTC and FERC prohibit the passing on of transaction costs to customers.
• PSE’s rate requests will continue to be filed regardless of the merger.
• PSE will be regulated by the UTC, FERC and other agencies no differently than today.
• Regardless of the merger, PSE will likely file for more rate increases in the years ahead as the utility manages around rising costs in the national and global energy marketplace.

“Maintenance will be impacted since the new owners are not local.”

Facts:

• PSE will continue to be locally governed, managed and run. Three incumbent members of the current boards, Steve Reynolds, chairman, president and CEO, the management team, and employees will all remain.
• PSE is not now “locally owned” and has not been for at least a century. PSE shares trade in a global marketplace for capital. PSE can trace some of its current shareholder owners to at least a dozen different countries.
• Regulation of facility maintenance schedules and requirements will remain unchanged.
• The investors that make up Puget Holdings are committed to supporting a local management team whose purpose, culture and track record is to responsibly manage essential community assets. Examples include:
  • Duquesne Light – regulated Pittsburgh electric utility
  • The Gas Company – Hawaiian regulated gas utility
  • Thermal Chicago – District Energy assets located in Chicago and Las Vegas
  • AltaLink – Electric transmission company in Alberta, Canada
  • Cardinal Power – Cogeneration power facility in Ontario
  • Aquarion Company – regulated New England water utility