The final order published by the District of Columbia PSC concerning its rejection of Exelon's application to acquire Pepco addresses "concern" regarding retail market impacts from the merger.

Specifically, the PSC states, "There is some concern about just how aggressive an Exelon-owned Constellation would be at recruiting customers when an Exelon-owned Pepco is also the SOS Administrator, and an Exelon-affiliate is also supplying energy for the SOS program. This would not be the first time, however, that the SOS Administrator is also affiliated with a retail electric supplier. We note that when Pepco affiliate Pepco Energy Services was active in the District there were no retail competition issues and we would not expect to see any if the Proposed Merger is consummated."

Ultimately, the PSC explained its decision to reject the merger as follows:

"The ability of our local distribution company to act independently and control its own operations will be further curtailed as it is subjected to additional levels of managerial review, oversight and control [under the merger]. Our Commission will need to develop new regulatory procedures to monitor charges from two service companies, to make certain that all necessary information for regulatory purposes and proceedings are locally available and timely provided and to ensure that Pepco, in its roles as the local distribution company and the SOS Administrator, is not negatively impacted by its parent company’s ownership of generation facilities. There is concern that the potential conflicts of interest inherent in Pepco’s role and its parent company’s policy positions and interests might inhibit our local distribution company from moving forward to embrace a cleaner and greener environment in the District and pursue its goals of having 50% renewable energy sources by 2032. This list of harms and potential harms, in our opinion, makes it difficult to conclude the Proposed Merger would benefit the District ratepayers and not merely leave them unharmed," the PSC said

"We are not persuaded by the record before us that the Joint Applicants will be the enthusiastic supporter and facilitator necessary to lead the District and its local distribution franchise in the future. Based on the foregoing, the evidence presented at the hearing, and the entire record in this matter, we conclude that the Proposed Merger, when taken as a whole, is not in the public interest because it does not benefit District ratepayers and the District rather than merely leave them unharmed," the PSC said

Tags:
Exelon   Pepco   M&A   District f Columbia  

Comment on this story


ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com
TPV-SALES-EXECUTIVE -- Back Office Provider -- Other
Sr-Market-Risk-Analyst -- Wholesale Supplier/Trader -- New York - New York City Metro
Energy-Regulatory-Specialist -- Other -- Other
More Stories on RetailEnergyX.com:
FT: Mitsubishi-Backed Retail Supplier 'Prepares Bid' For International Retail Supplier With U.S. Arm
Shell Acquiring 250,000 Customers From U.K. Supplier;' Octopus Acquiring 580,000 Customers
UK Retail Supplier With US Affiliate In Talks To Secure 'New Funding'; Wholesale Prices Challenge
NRG To Trim Costs, Reviews Retail Pricing Structure After Direct Energy Acquisition '
PSEG to Acquire 25% Ownership Interest in Ocean Wind