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Utility Which Also Acts As Competitive Supplier To Spinoff Retail Supplier Into Separate Affiliate

June 11, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

MidAmerican Energy Company has petitioned the Illinois Commerce Commission for approval to transfer the assets of its unregulated retail services division into a separate business entity inside Berkshire Hathaway Energy Company, MidAmerican's indirect parent company

Currently, the utility MidAmerican Energy Company operates as a retail supplier, via its unregulated retail services division (URS), in Illinois outside of its native service area, as it is permitted to do under Illinois' unique restructuring statute, as well as in other states.

MidAmerican is proposing to transfer the unregulated retail services division's assets and create a separate entity inside Berkshire Hathaway Energy, MidAmerican's indirect parent company. This new MidAmerican affiliate will become MidAmerican Energy Services, LLC

The unregulated retail services division operates as a retail electric supplier in Illinois as well as six other states and the District of Columbia

MidAmerican said that the unregulated retail services division plans to expand into additional deregulated electric states that could include New Jersey, New York, California and Massachusetts.

"Due to URS' evolving unregulated business plan and market expansion since 1999, MidAmerican determined that it makes business sense to transfer its division into a subsidiary within BHE," MidAmerican told the ICC

MidAmerican said that the Transaction will not include jurisdictional utility infrastructure or liabilities related to providing regulated utility service to customers. Instead, unregulated retail services division assets and liabilities, which are comprised predominantly of trade accounts receivable, trade accounts payable and balances related to URS' contracts with third parties will be transferred to MidAmerican Energy Services. No incremental financing will be required of MidAmerican as part of the transaction since the transfer will be made via dividend of URS' net assets to MidAmerican Energy Services from MidAmerican. MidAmerican already separates the URS business from MidAmerican's regulated operations. Therefore, little will change in terms of accounting policies and procedures utilized by MidAmerican after the spinoff of URS into MidAmerican Energy Services, MidAmerican said. Any transactional costs associated with the Transaction moving URS into MidAmerican Energy Services will be directly borne by URS.

Docket 15-0386

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