The Montgomery County Council urged the Maryland Public Service Commission Tuesday to get more concessions from Exelon Corp. to protect ratepayers and promote clean energy before approving the company’s proposed merger with Pepco.
The council unanimously adopted a resolution calling on the commission “to mitigate the serious risks to the public interest” posed by Exelon’s $6.8 billion deal to buy Pepco. It calls for regulators to secure commitments from the Chicago-based firm to hold down costs for consumers and to become a national leader in clean, renewable energy.
The council’s action puts it squarely on record as working against County Executive Isiah Leggett (D), who joined Prince George’s County Executive Rushern L. Baker III (D) last month in supporting the merger bid.
In a closed session several weeks ago, the council urged Leggett’s representatives not to make an agreement with Exelon.
But Leggett pronounced the merger “a good deal,” citing company promises to invest in energy-efficiency programs, solar-power generation, workforce development and recreational trails along some power-line rights of way. The company says it will pay $57.6 million for efficiency programs designated by Montgomery, Prince George’s and the commission.
Exelon promised to reduce the frequency and duration of Pepco outages. It also committed to raise the utility — which serves more than 700,000 customers in Montgomery, Prince George’s and the District — into the top quartile nationally for reliability, as measured by established industry indexes.
The county executives have no legal authority over the merger proposal. But the support of county officials will be a factor in the commission’s decision, which it is scheduled to make this spring. The merger plan, announced in April 2014, also involves purchases of power utilities in New Jersey and Delaware. If approved, it would make Exelon the mid-Atlantic’s dominant energy supplier.
The merger is opposed by Maryland Attorney General Brian E. Frosh (D), the state Office of People’s Counsel and other interested parties, including the Coalition for Utility Reform, led by Montgomery council member Roger Berliner (D-Potomac-Bethesda), who sponsored Tuesday’s resolution.
Berliner and other opponents contend that a prime motivation for the deal is Exelon’s interest in selling Maryland ratepayers electricity from its nuclear power plants, which are increasingly unprofitable because of low natural gas prices. Opponents say they are concerned that Exelon will put more resources into nuclear power at the expense of renewable energy.
Berliner said Exelon must make binding commitments to hold down rates and place a premium on renewable energy and energy efficiency.
“Much more needs to be done,” Berliner said, before the PSC “can find this merger in the public interest.”
Exelon spokesman Paul Adams said in a statement that the agreement reached with Montgomery and Prince George’s “not only meets but exceeds the standard of being in the public interest.” He also said Exelon “already has strong safeguards in place to ensure that nuclear plant costs do not impact” Pepco customers.
Misgivings have also been expressed by officials in the District, and the merger needs the approval of the city’s Public Service Commission as well as Maryland’s. D.C. Council members Mary M. Cheh (D-Ward 3), Elissa Silverman (I-At Large) and Charles Allen (D-Ward 6) have submitted a letter to the city commission expressing “grave doubts” about the deal.