For the second time in less than a month, Hydro One Ltd.'s proposed $6.7-billion takeover of Avista Corp. has been blocked by a U.S. regulator expressing concern about the Ontario government's influence over the Toronto-based company.

In a 15-page decision issued Thursday, the Idaho Public Utilities Commission (IPUC) ruled that the applicants failed to demonstrate that the transaction met the public interest and no-harm tests set out in the state law that limits an electric utility's ability to sell assets.

The Idaho commission, like its Washington counterpart that blocked the deal in early December, raised concerns that the Ontario government, which owns 47 per cent of Hydro One's shares, might meddle in Avista's operations.

It pointed to Ontario Premier Doug Ford's move to force former Hydro One CEO Mayo Schmidt to retire, which was followed by the resignation of the entire 14-member board.

"It is abundantly clear that the province does not have to own 51 per cent of Hydro One in order to effectively control the company," the IPUC wrote in its decision. "Based on the recent events surrounding the province's intrusions into Hydro One corporate affairs, any other conclusion would be unreasonable and ignorant in light of the uncontested facts and evidence."

The applicants have 21 days to petition a reconsideration, as was done after the Washington Utilities and Transportation Commission denied the application.

Approvals from state regulatory commissions in Idaho, Oregon, Montana, Alaska, and Washington are required for the takeover to go through. Alaska and Montana have approved the transaction, along with various federal agencies.

Hydro One and Avista say they are disappointed by Idaho's decision and are reviewing the order to determine the appropriate next steps.

With files from BNN Bloomberg