Just hours after the D.C. Public Service Commission (PSC) approved a proposed $6.8 billion merger of Chicago-based nuclear energy giant Exelon and D.C. utility Pepco Holdings Wednesday, Exelon’s CEO unexpectedly announced the two companies already completed the merger transaction, dealing a blow to opposition groups attempting to challenge the deal.
The PSC approved a revised merger agreement between the two companies Wednesday, leaving final approval with Exelon. Exelon expressed caution however, saying they would need to thoroughly review the PSC agreement before commenting further. (RELATED: DC Regulators Bypass Mayor, Approve Merger To Create Behemoth Utility)
“We must carefully review the Commission’s order,” Exelon spokesman Paul Adams said following the PSC’s Wednesday vote, according to Washington Business Journal. “Once we have had a chance to do so, we will have more to say about what it means and our next steps.”
The review evidently did not take long, as the two companies formally agreed to move forward with their merger plans, which were already previously approved by federal regulators, as well as regulators in Virginia, Maryland, Delaware and New Jersey. The agreement creates the largest utility in the country, servicing roughly 10 million customers, reports Washington Business Journal.
“Today, we join together as one company to play a vital role as a leader in our industry and the mid-Atlantic region,” Exelon CEO Chris Crane said in a statement Wednesday evening. “We’ve made a number of commitments to customers in all of the Pepco Holdings utilities’ jurisdictions – the District, Maryland, Delaware and New Jersey – and we look forward to getting to work to deliver those benefits to our customers and communities.”
Exelon hastily closed the deal partially due to the billions of dollars the company had in waiting, according to Washington Business Journal. Once funds begin disseminating, opposition efforts to roll back and appeal the merger will be severely hampered. Furthermore, Exelon will now distribute $430 million in credits and commitments to residents in D.C., Maryland, New Jersey and Delaware, with $79 million going to the District.
The PSC approved the proposed version of the merger with a 2-1 vote. Commission Chair Betty Ann Kane was the lone voice of dissent, arguing the bill guts consumer protections to energy rate increase, reports WTOP.
Liberal activists and members of the D.C. Council were celebrating the demise of the merger earlier in March, when Mayor Muriel Bowser dropped her support following PSC revisions she argued were not in consumer’s interests. At the gathering, an activist from Ward 8 declared, “It is clear there is no way to get this deal done,” while Council member Mary Cheh led the group in a “Go Away Exelon” chant, reports The DCist.
“I think it’s dead, but I’m holding my breath,” Cheh told the DCist. “I don’t want to underestimate money, power, and influence.”
Despite the deal seemingly on its death bed in March, Cheh’s caution proved right. The agreement serves to show the blossoming influence of D.C.’s business community, which aims to attract business and capital to Washington. Bowser expressed her disappointment over the agreement, but it remains unclear whether she will try to block it, reports The Washington Post.
“It appears the Public Service Commission favors government and commercial ratepayers over DC residents,” Bowser said in a statement. “Instead of a three year rate increase reprieve that we negotiated, it appears that DC residents will be hit with a rate increase as soon as this summer.”
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