The New Jersey Board of Public Utilities, the Virginia State Corporation Commission and the Federal Energy Regulatory Commission approved the merger between energy powerhouses Pepco Holdings Inc. and Exelon Corporation. The companies are still waiting on approvals from the D.C., Maryland, and Delaware Public Service Commissions.
The merger between the companies is expected to benefit customers through new financial and sustainability commitments, which would include the creation of 1500 new jobs. “There are significant benefits that we are anticipating as a result of this proposed merger,” Melissa Sherrod, vice president of corporate affairs at Exelon told the AFRO on March 24. “And as a result, customers, as a whole, will benefit from improved service, more reliable service. Employees will benefit from a stronger company that will deliver increased opportunities with a bigger company, and the philanthropy, nonprofit community will also benefit because of the long-term commitment that we have made to continue contributions.”
Sherrod said customer’s rates would be lower with the merger than without.
Although the D.C. Public Service Commission has not approved the merger, it will begin evidentiary hearings on March 30. The hearings are expected to last until April 8. Sherrod said the companies expect to submit the merger for a decision to the D.C. Public Service Commission by May 13.
The merger will provide benefits to D.C. customers including an increase in the customer investment fund to $33.75 million from $14 million. The merger will also save $51.2 million over 10 years, which will flow back to District customers through lower rates, credits, or energy assistance to low income customers, according to a press release. “As a result of the enhancement we have made to the customer investment fund, you also have enhanced the economic benefits that will come to the District,” Sherrod said.
The merger would provide the District with $168 million to $260 million in revenue, she said.
Pepco and Exelon recently reached an agreement with Prince George’s and Montgomery Counties in Maryland.
“The Montgomery County and Prince George’s County settlement agreement is significant because it covers such a large portion of Pepco customers,” Sherrod said. “It is very significant that you have two larger counties signing on to this agreement and reaching an agreement to say the merger is in the benefit of customers.”
According to Sherrod, three-fourths of Pepco’s customer base is located in the Maryland.
A press release from Pepco and Exelon said the merger will also increase the value of the Maryland’s customer investment fund to $94.4 million from $40 million.
Earlier in the month, an agreement was made between Pepco, Exelon and The Alliance for Solar Choice, a Maryland solar advocacy group, to facilitate the introduction of more on-site renewable generation in Maryland and improve cooperation among solar developers and Pepco Holdings’ utilities.
“This settlement is an extension of Exelon’s commitment to advancing the development of clean energy in Maryland, including solar and other renewable sources,” said Chris Crane, Exelon president and CEO, in a press release. “The agreement will add further transparency and ease to the interconnection process for distributed-generation resources in Pepco and Delmarva Power territories.”
The date the companies expected the Maryland Public Service Commission (PSC) to make a decision changed from April 8 to May 8.
“It’s moved a month later for a positive reason,” Sherrod said. “We were able to reach settlements with Prince George’s and Montgomery Counties. The schedule is moved to give additional time for parties to review that settlement and give comment on it and then at that point the commission will make their decision.”
Sherrod said the decision from the commission in Delaware is expected to occur on April 21.
The New Jersey Board of Public Utilities and the Virginia State Corporation Commission approved the merger in February 2015 and October 2014, respectively. The Federal Energy Regulatory Commission approved the merger in November 2014. “In general I believe this proposed merger will make Pepco a stronger company,” Sherrod said. “Overall I think this is a win across the board.”