The Federal Energy Regulatory Commission on Wednesday sent the proposed merger between PacifiCorp and Utah Power & Light Co. back to its staff for further elaboration.

The FERC staff presented the commission with a draft that would have permitted the union but required the merged company to auction its excess transmission capacity. The company would have to construct additional transmission capacity when it was needed.The merger between the companies based in Portland, Ore., and Salt Lake City would create an $8 billion utility serving 1.2 million customers in seven western states.

Commissioners asked the FERC staff to justify imposing any conditions on the merger and to submit a more detailed recommendation next week. They then will vote on it individually, without another formal meeting.

The two utilities say their merger would save them $500 million the first five years and that UP&L's rates would drop between 5 percent and 10 percent. The proposal would make UP&L a division of PacifiCorp, along with the latter's electricity business, Pacific Power & Light Co.