DOCKET UE-971300  Page 1



BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION


In the matter of the request of ) 
THE WASHINGTON WATER POWER COMPANY ) DOCKET UE-971300
for an order establishing  )
compliance with RCW 80.08.040  ) ORDER
. . . . . . . . . . . . . . . . . .)


  On August 19, 1997, The Washington Water Power Company (“Applicant”) filed 
its application before the Washington Utilities and Transportation Commission 
in this matter for an order establishing compliance with RCW 80.08.040.

Background

  In its filing, the Applicant proposes to (a) issue, sell, deliver, and/or 
guarantee Debt Securities, in one or more series, with an aggregate stated 
value of up to and including $250,000,000, and/or (b) refund currently 
outstanding Tax-Exempt Debt Securities, in one or more series, with an 
aggregate stated value of up to and including $85,000,000. (The Debt Securities 
and Tax-Exempt Debt Securities, collectively, the “Securities”).

  Each issue of Securities may contain a provision allowing it to be redeemed 
or repaid prior to maturity.  An early redemption provision may allow the 
Securities to be redeemed or repaid at any time, or it may allow the Securities 
to be redeemed or repaid only after a certain restrictive period.  In either 
case, the Securities will be redeemable at par or at a premium over par.  
Securities may bear a fixed or floating rate of interest and may be issued at 
par or with an original issue discount or premium.  In all series’ issuances, 
the terms for the sale of each series will be determined at the time of 
issuance, and underwriters, agents, or other purchasers will be selected at 
that time.  The terms for the sale of each series and the names of the 
underwriters, agents, or other purchasers will be supplied at the time of 
issuance.

  Debt Securities
  Debt Securities may be issued in the form of Unsecured Debt Securities 
(“Debentures”) or Unsecured Medium-Term Notes (“Notes”), and may contain 
certain features which enhance the Debt Securities.

  Debentures may be sold to underwriters or through agents who in turn will 
offer the Debentures to investors, or may be sold directly to investors either 
with or without the assistance of a private placement agent.  Debentures may be 
registered with the SEC and may be listed on a securities exchange.  Early 
redemption or callable provisions will be determined and supplied at the time 
of issuance.

  Notes may require registration under the federal securities laws.   Notes may 
be issued as part of a program on a continuous or periodic basis.  The 
Applicant may sell Notes through placement agents who market Notes on a 
reasonable efforts basis.  The Applicant may also sell Notes to underwriters 
who in turn offer Notes to investors or it may sell Notes directly to 
investors.  Notes may be listed on a securities exchange.

  If Notes are sold through a placement agent, at least two agents will be used 
to ensure competitive pricing.  Based on market conditions or consultation with 
the placement agents, the Applicant will determine the interest rates or 
interest rate formulas at which it would be willing to issue Notes of various 
maturities.  The placement agents will be notified of those interest rates or 
the method of calculation thereof.  The rates can be continuously updated to 
reflect changing market conditions and the Applicant’s demand for funds.

  It may be appropriate from time to time for the Applicant to issue and sell 
other types of Debt Securities. These could be in the form of, but not limited 
to, convertible debt or a variation or combination of the types of Debt 
Securities previously described herein.  Market conditions change rapidly and 
continuously, and the Applicant requests the flexibility to issue a form of 
Debt Securities that has not been specifically described herein, albeit within 
the dollar limits herein requested.  In advance of the date of issuance, the 
Applicant will notify the Commission, by letter, of the nature of any such 
other types of Debt Securities.

  Tax-Exempt Debt Securities
  The Applicant currently has outstanding $83.7 million of tax-exempt first 
mortgage bonds. When the bonds were originally issued, the Applicant entered 
into financing arrangements with a political subdivision (“Authority”) which 
was able to issue tax-exempt debt.  Given the current environment of interest 
rates, the Applicant believes it may be able to refund these securities with 
lower interest rates in generally the same procedure as originally issued.

  Feature to Enhance Debt or Tax-Exempt Securities
  From time to time, the Applicant may be able to reduce its borrowing costs by 
issuing fixed- or floating-rate debt and entering into one or a series of 
interest rate swap (“Swap”) contracts to convert fixed interest payments into 
favorable floating-rate payments or vice versa, or to convert floating-rate 
payments tied to one index (e.g., LIBOR) into floating-rate payments tied to 
another index (e.g., the Federal Reserve Composite Rate for commercial paper).  
Utilizing Swaps, when appropriate, will result in savings for ratepayers.

FINDINGS

  THE COMMISSION FINDS:

  1. The Washington Water Power Company, a Washington corporation, is a public 
service company subject to the jurisdiction of this Commission under the 
provisions of Chapter 80.08 RCW.

  2. As to form, the application herein meets the requirements of Chapter 80.08 
RCW and the rules and regulations of the Commission adopted pursuant thereto.

  3. The Company’s application in this Docket contains: (a) a description of 
the purposes for which the proposed securities will be issued, certified by an 
authorized officer; (b) a description of the proposed issuances, including the 
terms of financing; and (c) a statement as to why the proposed transactions are 
in the public interest.

  4. An order consistent with the above findings is not contrary to the public 
interest.

ORDER

  THE COMMISSION ORDERS:

  1. The Washington Water Power Company has complied with the requirements of 
RCW 80.08.040.

  2. The Washington Water Power Company file, as soon as available: (a) the 
Report of Securities Issued required by RCW Chapter 80; (b) verified copies of 
any agreement entered into in connection with any transaction pursuant to this 
order; and (c) a verified statement setting forth in reasonable detail the 
disposition of the proceeds of each offering made pursuant to this order.

  3. This order shall in no way affect the authority of this Commission over 
rates, service, accounts, valuations, estimates or determination of costs, or 
any matters whatsoever that may come before it, nor shall anything herein be 
construed as an acquiescence in any estimate or determination of costs, or any 
valuation of property claimed or asserted.


  DATED at Olympia, Washington, and effective this   th
day of October, 1997.


WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION




        STEVE McLELLAN
        Secretary