Dive Brief:

• Connecticut regulators have conditionally approved the merger of Iberdrola USA and UIL Holding (UIL), contingent on several conditions that include ratepayer protections, credits, a rate freeze, assurances of local control and a plan to clean up an abandoned coal facility, the Hartford Courant reports. 
• The deal, which will create one of the largest utilities in the United States with 6.7 GW of installed capacity, involves some 700,000 electric and gas customers
• The Connecticut Public Utilities Regulatory Authority will take written comments opposing the deal until tomorrow, and has scheduled oral arguments for Dec. 3; a decision is planned for Dec. 9.

Dive Insight:

Connecticut regulators are preparing to approve the merger of Iberdrola and UIL, a $3 billion deal, but to get there the Spanish corporation had to agree to a wide range of assurances. According to the Hartford Courant, the companies will clean up the contaminated English Station coal power plant complex in New Haven, put $40 million towards customer credits and freeze distribution rates.

Attorney General George Jepsen, who pushed for many of the deal concessions, said he was supporting the proposed approval.

"While my staff is currently reviewing the draft decision, I'm pleased that PURA has given its initial approval to this transaction," Jepsen said in a statement. "The revised application provided for a number of ratepayer protections, including guarantees that local management control will be maintained and the local utilities will be 'ringed off' from financial risks flowing from the parent companies."

The companies also committed to substantial customer benefits in the near term and further out, including ratepayer credits and customer service improvement. State regulators will be able to monitor and enforce compliance, Jepsen said.  

"Taken together, these commitments and protections, along with other economic and community development benefits, convinced me that this transaction was worth supporting," he said. "I am particularly gratified that this approval paves the way for expediting remediation of the polluted English Station site in New Haven under a consent order negotiated by my office, working with Governor Malloy and the state Department of Energy and Environmental Protection."

Federal regulators approved the deal over the summer. The combined company would have a net income of almost $600 million. The deal, announced in February, will be completed with  an exchange of Iberdrola USA shares for UIL stock, along with cash payments to UIL shareholders of $597 million.

Once merged, the two companies would serve 3 million customers and would be the second largest wind generator in the country, serving customers in New York, Connecticut, Maine and Massachusetts and other states.