Wednesday February 24, 2016
To District of Columbia Utility Consumers,
As the People's Counsel for the District of Columbia, I want to alert you to a critical decision that will be issued by the D.C. Public Service Commission (PSC) on Friday, February 26. The Commission will either approve or deny a settlement agreement that would allow Exelon Corporation to acquire Pepco Holdings, Inc. (PHI). In order to approve the settlement agreement, the Commission must find that the proposed merger is in the public interest.
PHI and Exelon placed an initial merger application before the PSC almost two years ago. From the outset, the Office of the People's Counsel's goal in evaluating the merger application was to determine if there were tangible benefits for consumers. After carefully evaluating the application, OPC determined that the merger application was not in the public interest because there was an imbalance of benefits between consumers and PHI and Exelon. Specifically, consumers would bear several risks and receive few benefits while PHI and Exelon would reap significant benefits.
In August 2015, the Commission denied PHI and Exelon's merger application in large part because it did not include any real benefits for consumers. Shortly thereafter, PHI and Exelon presented a settlement agreement that addressed many of the Commission's reasons for denying the merger, included major OPC recommendations and a number of renewable energy options which were not previously offered.
The settlement agreement was supported by several parties in the case including the Office of the People's Counsel, the District Department of Energy and Environment, the Office of the Attorney General, and the Apartment and Office Building Association. OPC supported this settlement proposal because it included a significant increase in benefits for ratepayers than Pepco-Exelon proposed during the proceedings.
Through all the proceedings leading up to the pending decision, OPC has been unwavering in its mandated role as the advocate for District ratepayers. We have continued to aggressively work to ensure that any merger approved would be in the best interest of consumers now and in the future.
No matter what decision the Public Service Commission renders this Friday, OPC will continue to staunchly defend the rights of all District of Columbia ratepayers. The utility marketplace continues to evolve as new options and technologies become available, and it will change even more after this decision. What will not change is my strong advocacy for D.C. consumers, whether there is an Pepco-Exelon merger or not.