Dive Brief:

• Supporters and opponents of the Exelon-Pepco Holdings merger have been fiercely lobbying District of Columbia Mayor Muriel Bowser (D), as a deadline for the companies to appeal the city's rejection is a week away.
• The D.C. Public Service Commission in August rejected the deal, finding there were not enough benefits for District residents and the merger did not appear to support the city's push for more renewable energy.
• Exelon has said it is committed to the merger and will appeal; Pepco has indicated rates could rise for D.C. residents without the merger's approval.

Dive Insight:

The District of Columbia may have rejected Exelon's bid to acquire Pepco, but the case is by no means done. The companies have a week to appeal the PSC's decision and in the meantime both sides have been lobbying Mayor Bowser. While the decision rests with the commission, Bowser controls appointments and as the Washington Post points out if the mayor supports the deal, "it would make it hard for those city regulators to reject it."

Environmentalists last week gathered in D.C. outside the mayor's office to call for her to stand firm on the city's rejection. At the same time, former D.C. mayor Anthony Williams stood with business leaders at a separate rally and called for Bowser to reverse her decision.  

“I’m an environmentalist,” Williams said, “and I don’t see what the big deal is.”

Regulators in Delaware, Maryland, New Jersey and Virginia previously approved the deal, and Exelon said failing to complete the merger would mean customers in those states would lose out as well. The company has been adamant that ratepayers in all service territories would see improvements in service and reliability, as well as lower rates. But Pepco has indicated to D.C. that should the merger not go through, rates would likely rise.

Following D.C.'s rejection, Exelon issued a statement saying it had reviewed the order and was convinced the decision "fails to recognize the substantial immediate and long-term benefits of our merger proposal to citizens, businesses and communities in the District of Columbia."

There is some speculation that should Exelon further sweeten the deal, as it did in other jurisdictions, that the city could relent. Following the commission's August decision Bowser issued a statement, saying that she supported the rejection of the merger, but the Post sees some wiggle room in it. 

"Moving forward," she added, "we want to ensure that DC utility ratepayers receive quality service, that we maintain and grow jobs in the District, and that we keep DC on our continued path toward sustainability.”

Pepco and Exelon have until Sept. 28 to file for reconsideration; a rejection there would likely send the case into the courts.