Environmentalists Blast Exelon-Bowser Deal
Environmentalists Blast Exelon-Bowser Deal

A merger of Exelon Corp and Pepco Holdings Inc. would create the largest electric utility holding company in the country.

In the meantime, however, the proposed merger has so far caused nothing but controversy in the District, with environmental groups railing against the deal.

On Monday, Oct. 26, those opposing the deal turned their furor toward Mayor Muriel Bowser and her administration’s recent about-face in giving her blessing to the $6.8 billion merger.

“We’re concerned about how this happened … now Pepco and Exelon are tied at the hip with D.C. government pushing for an expedited review,” said Anya Schoolman, the executive director of DC Sun, an organization that expands access to solar by educating District residents about the benefits of distributed solar energy.

DC Sun opposes the merger.

“Mayor Bowser’s decision to settle with Exelon does nothing to change the fundamental conflict of interest identified by the Public Service Commission in their unanimous rejection of this bad deal,” Schoolman said.

“Allowing Exelon to take over Pepco will take money out of the pockets of D.C. ratepayers while providing them no tangible benefit. It will also harm the ability of D.C. residents to develop their own clean, cost-effective energy.”

Schoolman joined several others who are opposed to the deal in a news conference call to lay out why the D.C. Public Service Commission should reject the recent settlement between Bowser and Exelon Corporation and dismiss attempts to cut the public out of the review process.

On Aug. 25, the commission rejected a proposed takeover by Exelon of Pepco, but despite the PSC’s decision and public opposition to the takeover, Bowser and Exelon announced a deal on Oct. 6 that would allow the merger to go forward.

That deal reportedly included a $25 million naming-rights payment by Exelon to the District for a planned soccer stadium.

Schoolman and others called the deal a quid pro quo that should concern commission officials and District residents alike.

“As part of Exelon and Pepco’s shock and awe ad buy campaign, they feature the new settlement [with Bowser] as good for the environment,” said Mike Tidwell, director of the Chesapeake Climate Action Network, a grassroots and nonprofit dedicated to fighting global warming in Maryland, Virginia and the District.

“When you kick the tires of a settlement, support is literally not there,” Tidwell said. “There are no environmental groups that support the settlement and no group has found that it’s good for the environment.”

Tidwell and others, like energy analyst Cathy Kunkel of the Institute for Energy Economics and Financial Analysis and Allison Fisher, the outreach director for Public Citizen’s Energy Program, said the merger isn’t in the public interest.

They claim that the deal would provide Exelon with a near-monopoly over the local utility market and severely restrict Maryland’s ability to transition to clean, affordable and efficient electricity that’s needed.

Earlier this month, Exelon filed a motion to reopen the acquisition proceeding after its deal with Bowser and the District’s Public Utilities Commission said it would accept comments.

The announcement proved to be a 180-degree turn after regulators previously rejected the initial deal that had been approved by the Regulatory Commission and state regulators in Virginia, Maryland, New Jersey and Delaware.

In the initial decision, commissioners determined that Exelon’s bid was not in the best interest of Pepco’s D.C. customers and that Exelon’s “primary interest is not in distribution, but in generation.”

However, Bowser’s office confirmed that the mayor had negotiated a new deal and reversed her previous decision to oppose the merger.

“We kept the conversations with Pepco and Exelon alive because we knew we had to do better for the District,” Bowser said in a statement.

“My team negotiated a deal that puts District residents and ratepayers first – by delivering a public utility that is cost-effective, dependable and environmentally sound.”

Chris Crane, the president and CEO of Exelon, said the company had heard the Public Service Commission’s concerns “loud and clear, and this new merger proposal presents greater benefits to the District.”

“Our settlement includes more than 120 commitments to ensure the merger is unequivocally in the public interest,” Crane said.

Under the settlement, Exelon will invest $78 million in the District, five times more than the originally proposed investment of $14 million, according to a report published by Green Tech Media.

A large chunk of the funding, $55 million, is dedicated to keeping electricity prices affordable for D.C. residents.

That includes $25.6 million to protect residential ratepayers from rate increases through March 2019, nearly $16 million to aid low-income ratepayers and a $14 million one-time residential bill credit worth an average of $50 per ratepayer. The D.C. credit is lower than the rate credits secured in Delaware ($128), New Jersey ($114) and Maryland ($100).

Exelon has also agreed to a $17 million sustainability fund.

This includes $3.5 million to support energy-efficiency projects, $3.5 million to support solar development and $10 million to the D.C. green building fund.

In addition, Exelon has agreed to develop 10 megawatts of solar and to purchase 100 megawatts of wind within five years of the merger closing.

The agreement would also enhance grid reliability through the development of four micro grids and an improved interconnection process for distributed generation customers, Bowser’s office said. Exelon will move 100 existing positions to D.C. and invest $5.2 million in a new District workforce training program.

“The backroom cash deal (between Exelon and Bowser) provides only illusory benefits and does nothing to correct the structural harm that will come by giving Exelon monopoly control over D.C. ratepayers,” Tidwell said. “The D.C. Public Service Commission made the right decision to reject this proposed merger. The PSC should ignore the mayor’s hollow deal.”

Schoolman added that the solar provisions do nothing to enhance the D.C. solar market.

“The solar component is absolutely nothing new and a total disappointment,” she said. “It does nothing to address the inherent conflict of interest between the utility trying to keep competition out of the market, and the solar industry and solar consumers that want a vibrant competitive solar economy.”

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Stacy M. Brown is a senior writer for The Washington Informer and the senior national correspondent for the Black Press of America. Stacy has more than 25 years of journalism experience and has authored...

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