Power Company Lobbying to Keep Md. Lawmakers Out of Merger

Maryland's largest power company has launched a discreet but aggressive lobbying campaign to prevent the legislature from intervening with its plans to merge with a Florida utility to create one of the nation's largest electricity suppliers.

Constellation Energy Group has bulked up its roster of lobbyists in Annapolis, and the company's executives have been meeting with top lawmakers in recent days to try to dissuade the legislature from taking steps that would scotch the $11.5 billion deal with FPL Group, based in Juno Beach, Fla.

"This company is launching a lobbying blitz in the halls of the legislature to speed this merger through," said Sen. Leo E. Green (D-Prince George's). "We need to step on the brakes."

Green and other top lawmakers predict a fierce legislative battle over the proposed merger, which they worry could mean sizable rate increases for the 1 million Maryland customers of Constellation's subsidiary Baltimore Gas & Electric Co.

The merger comes as state caps preventing rate increases are set to be lifted in July. And Senate Finance Committee Chairman Thomas M. Middleton (D-Charles) said he worries that Maryland customers would end up paying the costs of repairing FPL Group's hurricane-battered power lines.

Green said he is introducing two bills this week to add layers of review to the process that Constellation will navigate to gain approval for the merger. A third proposal, in the House, is expected to drop early next week, said Del. Dereck E. Davis (D-Prince George's), who chairs the committee that oversees energy policy.

"The merger may be in the best interest of the company, but we need to make sure it's also in the best interest of Maryland citizens," Davis said.

Constellation spokesman Robert L. Gould released a statement last night saying that the company believes there are "sufficient" layers of regulatory oversight to reassure lawmakers.

"This merger will have a very positive effect on the state and our customers, and we think the existing review process will demonstrate that fact," Gould said.

But the company is not leaving anything to chance. The first public sign of the lobbying effort came last week, when the Senate president and House speaker reported visits from the chairman of the state's university system, who is also a Constellation executive.

Board of Regents Chairman David H. Nevins said he came into town to introduce the legislative leaders to the chief executive of FPL Group. Those present said the meetings included discussions of the merger.

"It appears they brought him in to be another insider to push their agenda," said Sen. Paul G. Pinsky (D-Prince George's). "They're concerned about the merger, and they're pulling out every trick and card they can use."