Litigation

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements [Abstract]

Litigation

(8)   Litigation

Residential Exchange. PSE has been a party to certain agreements with the Bonneville Power Administration (BPA) that provide payments under its Residential Exchange Program (REP) to PSE, which PSE passes through to its residential and small farm electric customers.  PSE has agreements with the BPA for REP payments through 2011 and for the period 2011 to 2028.  In December 2008, PSE and other parties sought United States Court of Appeals for the Ninth Circuit review regarding BPA's agreements for REP payments during these periods.  The amounts of REP payments under these agreements and the methods utilized in setting them are subject to FERC review or judicial review, or both, and are subject to adjustment, which may affect the amount of REP payments made or to be made by BPA to PSE.  It is not clear what impact, if any, these reviews or other REP-related litigation may ultimately have on PSE.

Colstrip Matters. In May 2003, approximately 50 plaintiffs initiated an action against the owners of Colstrip, including PSE, regarding seepage from two different wastewater pond areas and from the Colstrip water supply pond.  The defendants reached an agreement on a global settlement with all plaintiffs and PSE expensed its share of the settlement in 2008.  PSE received a partial reimbursement for its share from insurers in December 2010 and January 2011.

On March 29, 2007, a second complaint related to pond seepage was filed in Montana State District Court in Rosebud County, on behalf of two ranch owners alleging damage due to the Colstrip Units 3 & 4 effluent holding pond.  A mediation between plaintiffs and PPL Montana, LLC, the operator of Units 3 & 4, took place on July 14, 2010 and parties are working toward a final settlement.

Snoqualmie Falls.  On July 7, 2010, a lawsuit was filed in the U.S. District Court for the Western District of Washington by the Snoqualmie Valley Preservation Alliance, a group of downstream landowners, against the United States Army Corps of Engineers (Corps) challenging permits issued by the Corps in connection with the redevelopment of the Snoqualmie Falls Hydroelectric Project.  PSE sought and was granted permission to intervene in the proceeding.  Motions for summary judgment were filed by the plaintiffs and the Corps.  PSE joined the Corps' motion and filed a motion for summary judgment arguing the plaintiffs' claims were barred as untimely and improper.  On March 30, 2011, the District Court issued an order granting the Corps' motion for summary judgment, denying the plaintiffs' motion for summary judgment and dismissing the plaintiffs' lawsuit.  On May 26, 2011, plaintiffs filed a notice of appeal with the U.S. Court of Appeals for the Ninth Circuit, claiming that the District Court erred in dismissing the lawsuit.  All briefing must be submitted by October 20, 2011.  Oral argument on the appeal will occur thereafter, with a decision by the Court of Appeals to follow.  Litigation is subject to numerous uncertainties and PSE is unable to predict the ultimate outcome of this matter.