On October 28, 2026, the Public Utility Commission of Oregon (OPUC) issued Order No. 26-401 approving California Water Service Group’s (Cal Water) acquisition of Oregon Water Utilities – Cline Butte and Oregon Water Utilities – Mountain Lakes from SouthWest Water Company. The OPUC found that the transaction satisfies the Commission’s public interest “no harm” standard for water utility transfers.
Cline Butte is a regulated water utility serving approximately 1,841 connections near Redmond, Oregon. Mountain Lakes serves approximately 886 connections in Running Y, Ridgewater, Southview, and Pinecrest. Cal Water will acquire the utilities through its acquisition of Northwest Utility Systems, Inc., their direct parent company. Following the transaction, Cline Butte and Mountain Lakes will remain separate legal entities and continue to own their existing utility property, easements, and water rights.
The Joint Application stated that customers will experience no interruption in service and no immediate change in existing water rates as a result of the transaction. The applicants also emphasized Cal Water’s financial resources and extensive experience operating regulated water utilities. Cal Water currently provides water and wastewater utility service in five states and serves approximately two million customers through approximately 550,000 service connections.
The Commission approved the transaction subject to conditions intended to preserve regulatory oversight and financial separation following the acquisition. Among other requirements, Cline Butte and Mountain Lakes must continue to maintain separate financial information and identifiable assets and liabilities, comply with affiliated-interest requirements, and obtain Commission approval before guaranteeing affiliate debt. The utilities must also file a general rate case by April 15, 2028.
As part of the transaction, Cline Butte and Mountain Lakes will convert from corporations to limited liability companies. The applicants requested approval of those conversions along with approval of the acquisition. Sanger Greene, PC (Irion Sanger) represented Oregon Water Utilities – Cline Butte, Oregon Water Utilities – Mountain Lakes, and SouthWest Water Company in the proceeding.
