Uneasy lies the head of Puget Sound Energy

The Times shares the public's uneasiness over the sale of Puget Sound Energy to an Australian investment bank and Canadian pension funds.

Puget Energy is the largest private utility in Washington. Its managers and directors are here, and they are where the buck stops. After the acquisition, the buck will stop in Australia.The citizens and ratepayers who spoke at the Utilities and Transportation Commission's hearing in Bellevue Thursday sensed this issue, though some of their specific worries may have missed the mark.

Even if all its shares are owned by foreigners, Puget will remain a separate company with books open to state regulators. Puget will have to follow the same laws to build a power plant, to raise rates, and so on.

Ratepayers will still be charged for the cost of works necessary to serve them, and should not have their rates raised one penny to meet the financial obligations of Australian or Canadian stock buyers.

There was a thought at the hearing that Puget is a community asset, like the body of water for which it is named. "This is privatization!" one man said. Legally it is not. Puget already belongs to private shareholders. This is a proposal to exchange one set of shareholders — mostly Americans investing for their retirement — for another, including funds that pay for the retirement of Canadians.

But the citizens were not entirely wrong. Something real is being lost; they could feel it. Julie Avila of Finn Hill touched a part of it when she recalled that during the storm of 2006, when she was out of electric power for 10 says, someone from Puget called every day to check on her family.

"If a company were owned by investors in Canada and Australia, I don't think we would be getting those calls," she said.

Whether she is right about the calls to her house, no one can know. But common sense and experience tell us that it matters where the company's ultimate boss lives. If a storm knocks out the power of 100,000 people, it matters whether the CEO is in that storm, and whether the directors are in it. Economic theory might say it shouldn't matter, because financial incentives remain the same, but it does matter.

The UTC should take a hard look at this proposal, and the behavior and character of the acquirer, the Macquarie Group of Australia. The regulators should keep in mind whom they work for, and who will benefit from their decision.