ANC 3B Discusses Proposed Pepco-Exelon Merger

The primary topic of discussion at the November meeting was the proposed acquisition of Pepco by Exelon, the Chicago-based energy conglomerate. ANC 3B hosted representatives from Pepco and from the Office of People’s Counsel (OPC) to discuss the potential impacts of this acquisition.

In their presentation, posted here, OPC described their opposition to the merger as initially proposed. OPC noted that in order for the Public Utilities Commission to approve the merger, the law requires that the benefits received by the merged companies “must not come at the expense of ratepayers;” that the merger “must produce direct and traceable financial benefits to ratepayers;” and that the merger “taken as a whole must be consistent with the public interest.”

OPC believes these conditions are not met under the present terms of the proposal. Specifically, OPC noted concerns about reliability (that Exelon will provide a power delivery system that will be less reliable than what Pepco is projecting without the merger), electricity rates (Exelon’s higher risk profile could result in increased capital costs passed on to consumers, and concerns about allocating costs between Pepco and other Exelon entities could result in higher rates for Pepco’s consumers), and renewables (that Exelon’s business model, which relies on nuclear generation, and their history of opposition to clean-energy initiatives could threaten progress in expanding use of renewable energy in DC).

ANC 3B will continue to study this issue, and will potentially consider a resolution opposing the merger at the January meeting.

Citizens who are interested in providing comments to the Public Utilities Commission can also do so directly by writing or emailing (reference Formal Case No. 1119) the DC Public Service Commission, c/o Brinda Westbrook-Sedgwick, Commission Secretary, 1333 H Street, N.W., Second Floor, West Tower, Washington, D.C. 20005. The email address is psc-commissionsecretary@dc.gov.