The PGE Deal
Now that the shock has subsided over the announced takeover of Portland General Electric by a group of institutional investors led by former Mayor/Governor/Transportation Secretary Neil Goldschmidt, it's becoming a little easier to take stock of what it will mean.
First and foremost: Neil Goldschmidt will soon own the nuclear waste pool at the defunct Trojan Nuclear Power Plant. I haven't checked my copy of the Book of Revelation yet, but as I recall, that's in there toward the end.
As noted yesterday, others will now join me in blasting Neil (as I have for some months now) for continuing to use the influence he gained in public service to line his own pockets. Enough about that for now, at least until he pulls his next stunt. (I note in passing that Governor Ted has now suddenly put him in charge of the state's public universities. Forgive me if I wonder how Neil, or his or his spouse's clients, are making money off that one.)
The good news is, the PGE purchase should put an end to the City of Portland's misguided effort to enter the electric utility business itself. Led by Commissioner Erik Sten, the city's crown prince of bad ideas, but aided and abetted even by his otherwise sensible colleague Randy "Howdy Neighbor" Leonard, this fiasco-in-the-making would have resulted in risk to the city's taxpayers and little benefit to its ratepayers. The final tally isn't in on what this quixotic adventure will end up costing the city treasury, but at last report it was $800,000. I'll bet it tops a million before Sten gives it up. And like his expensive prior campaign to force cable companies to lease their lines to other internet providers, what the city has to show for this amount of scarce change is absolutely nothing. Will somebody please run against this guy?
On its face, the deal as announced looks pretty good to me. PGE stays in private hands. It's run by a financially strong group headed by a couple of Oregon face cards, and so it should have the best interests of the residents and businesses of the region at heart.
But I say "should," because there's no guarantee. Goldschmidt's first and foremost legal duty as head of the new company is to maximize profit for the investor group, even when the public interest cries out against it. And although his presence at the top of this new electricity pyramid gives some observers comfort, I worry about it. This guy helped the Tram People put the screws to the Lair Hill neighborhood, and he'll do the same to the ratepayers if his investors (and his own wallet) tell him to.
Plus, there is no guarantee that the new owners won't sell PGE to the next bidder who comes along with cash in hand, even if the buyer is a known snake in the grass. Texas Pacific Group, the lead cash player in the investment group, has been known to turn some properties over quickly when a better deal appeared. Of the 50 companies TPG has bought into over its decade of operation, it's apparently sold out of 20 of them. Here the investors are paying $2.35 billion for PGE; if they're offered, say, $2.7 billion a few months after they take over, PGE could well be under yet another new management in short order.
Bottom line? I guess my reaction is one of mild relief, spiced with amusement but tinged with nagging concern.