The District of Columbia PSC denied the application of Exelon to acquire Pepco, stating that the merger was not shown to be in the public interest

In particular, the PSC said that the post-merger organizational structure for Pepco would result in, "diminishing the influence of Pepco within the new structure[,] and that would result in a more complex regulatory structure that would negatively impact the Commission's ability to regulate Pepco."

"Pepco will become a second tier company in a much larger corporation whose primary interest is not in distribution, but in generation. At a time of change in the energy field, Pepco's ability to adapt will be constrained by an increased management bureaucracy. We are also concerned about the inherent conflict of interest that might inhibit our local distribution company from moving forward to embrace a cleaner and greener environment," the PSC said.

PSC Chairman Betty Ann Kane stated, "The public policy of the District is that the local electric company should focus solely on providing safe, reliable and affordable distribution service to District residences, businesses and institutions. The evidence in the record is that sale and change in control proposed in the merger would move us in the opposite direction."

FC 1119

Tags:
Exelon   Pepco   M&A   District of Columbia  

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