BALTIMORE (AP) — Maryland regulators approved Exelon Corp.’s proposed $7.9 billion takeover of Constellation Energy Group on Friday, saying they had determined the deal would be in the public interest if the companies stick to commitments including renewable energy construction, customer credits and assistance to low-income residents.
The decision follows months of wrangling between state officials and executives for the companies. Gov. Martin O’Malley initially opposed the merger and relented after the Constellation and Exelon increased commitments that also include construction of a new headquarters in downtown Baltimore. However, the Maryland Office of People’s Counsel, which represents utility customers, continued to oppose the takeover, saying the companies have not demonstrated the takeover will not harm customers of Baltimore Gas and Electric, a Constellation subsidiary regulated by the commission.
The deal would create the largest competitive power supplier in the United States, serving 6.6 million customers in Maryland, Illinois and Pennsylvania. The takeover has already been approved by the Department of Justice, the Nuclear Regulatory Commission, shareholders and New York and Texas regulators, and is still awaiting approval from the Federal Energy Regulatory Commission.
Regulatory approval was needed in Texas because both companies own plants in the state, and Constellation markets power and gas there.
Opponents had also criticized nearly 600 job losses expected after the deal closes, although the companies said the merger would create jobs in the long run.
The PSC said in its order that “we do not share the Applicants’ full confidence regarding its precise predictions of job impact.”
However, the commission noted the construction of the new headquarters, low-income assistance, up to 300 megawatts of new generation capacity and other commitments will likely offset the anticipated loss of 630 Constellation positions.
The order follows approval a day earlier by the Nuclear Regulatory Commission. And it came on the same day that Constellation reported losing $584 million in the fourth quarter as a drop in power prices led it to book hefty losses in its nuclear energy business.
(Copyright 2012 by The Associated Press. All Rights Reserved.)