FERC approval needed for Exelon-Constellation merger

20 February 2012

The Nuclear Regulatory Commission and the Maryland Public Service Commission (PSC) have recently approved the proposed merger between Exelon Corporation and Constellation Energy Group. Now, only regulatory approval from the Federal Energy Regulatory Commission (FERC) is needed before the merger can go ahead.

The merger would result in Exelon indirectly owning 50.01% of Constellation Energy Nuclear Group (CENG), which is jointly owned by CEG and EDF, Inc., a subsidiary of Electricité de France SA. This would make Exelon the largest nuclear power plant operator in the United States by an even bigger margin with a fleet of 22 nuclear power plants (19.0 GW).

On 16 February, the NRC approved the proposed merger between Exelon and Constellation Energy, including the indirect transfer of operating licenses for five commercial nuclear power plants and two spent fuel storage installations.

CENG currently holds operating licenses for five nuclear power plants – Calvert Cliffs 1 and 2, Nine Mile Point 1 and 2, and R.E. Ginna – as well as independent spent fuel storage installations at Calvert Cliffs and Ginna. The indirect transfer of these licenses will not result in any physical changes to the facilities or any changes to the conduct of operations, NRC said.

The Maryland Public Service Commission (PSC) has also approved the merger, Constellation announced on 17 February, although the order adds some additional conditions.

Among 40 conditions, are requirements that the new company create a $113.5 million customer investment fund to invest in energy efficiency and low-income energy assistance and provide a $100 rate credit to BGE residential customers within 90-days. The conditions also include enhanced ratepayer protections and safeguards against the new company’s ability to increase wholesale electricity prices by exerting market power.

"We are pleased that the Maryland PSC has approved our merger with Constellation, and we accept the additional conditions that the Commission has imposed," said Exelon President and COO Christopher M. Crane, who will become president and CEO of Exelon upon closing of the merger.

Approvals for the merger been granted by the New York Public Service Commission, the Public Utility Commission of Texas, and the U.S. Department of Justice, according to Constellation.

The merger now requires regulatory approval by the Federal Energy Regulatory Commission.




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