UniSource Energy Corp.’s efforts to complete its proposed sale to Saguaro Utility Group LP, a private investment-backed consortium, before the year is over took another step forward last week after federal regulators gave their blessing to the transaction.

“The Commission has reviewed the transaction under its merger policy statement and will authorize the transaction as consistent with the public interest,” FERC said in its Oct. 12 order.

Saguaro’s major backers include J.P. Morgan Partners LLC, Kohlberg, Kravis Roberts & Co. LP and Wachovia Capital Partners.

In signing off on the proposed transaction, FERC also accepted a proposed market monitoring plan that was filed by UniSource and Saguaro. They proposed to implement a plan to monitor Tucson Electric’s and UNS Electric’s generation dispatch and the operation of their transmission systems and to identify and report to the Commission regarding any potential anticompetitive conduct. Tucson Electric and UNS Electric are UniSource subsidiaries.

Under the market monitoring plan, monitoring and reporting will be conducted concerning six general areas:

A market monitor will report its findings directly to the Commission and Tucson Electric simultaneously on a quarterly basis, but may also report findings at other times when necessary. Additionally, the market monitor will report potentially anticompetitive conduct within 48 hours of its discovery of the conduct. The monitor will also respond to Commission requests for additional data and analysis on an as-required basis, as well as to complaints by customers or competitors of Tucson Electric.

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