Dive Brief:
- FERC last week authorized the merger of Exelon and Pepco Holdings, another step towards joining the companies' combined six electric and gas utilities.
- The deal was approved by Virginia regulators in October and by Pepco stockholders in September. The two companies say they expect to complete the merger in the second or third quarter of 2015.
- Regulators in Delaware, the District of Columbia, New Jersey and Maryland are still looking at the merger, however. The deal is also subject to Hart-Scott-Rodino Act requirements and other conditions.
Dive Insight:
FERC's decision is one more step towards combining Exelon’s three electric and gas utilities – BGE, ComEd and PECO – and Pepco's three – Atlantic City Electric, Delmarva Power and Pepco.
“This approval is further momentum toward uniting our two companies,” said Joseph M. Rigby, PHI chairman, president and CEO. “Together, we will bring substantial benefits to our customers and the communities we serve.”
If approved, the merger would result in Exelon's utilities serving 10 million customers with a combined rate base of $26 billion. The deal has critics, however, including those who say the merger would increase Exelon’s leverage in its opposition to the production tax credit for wind development.
Pepco Holdings' regulated utilities have each divested their generation facilities, FERC noted in the order. The three utilities do not purchase power except under contracts to serve their default service load and under must-take contracts from qualifying facilities.
"Each of the utilities also operates under a retail competition regime and has no captive customers," FERC noted.
