(WASHINGTON, DC) - Today, Mayor Muriel Bowser announced that the District of Columbia has reached a settlement in the Exelon-Pepco merger negotiations. The agreement delivers on the Mayor’s commitment to improve affordability, reliability, and sustainability for ratepayers in the District.
After the Public Service Commission denied the proposed merger in August 2015, the Bowser Administration negotiated (with the support of the Office of the People’s Counsel, Attorney General and additional signatories) to reach an agreement. As a direct result of those negotiations, Exelon made significant improvements from the original proposal. The new agreement increases Exelon’s originally proposed investment in the District from $14 million to $78 million.
“The District deserves a healthy utility company that guarantees affordability, reliability and sustainability for residents and ratepayers,” said Mayor Bowser. “We kept the conversations with Pepco and Exelon alive, because we knew we had to do better for the District. 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.”
The renegotiated merger ensures affordability for District residents. It includes provisions to protect ratepayers from previously scheduled rate increases through March 2019; provides residents with an average one-time credit of $57; and provides financial support for the District’s low-income residents. In addition, the agreement will result in more reliable service for customers. Pepco has committed to improving reliability and service, and has agreed to penalties if those commitments are not met. Pepco will strengthen the “interconnection” between people who generate their own power and the grid, and will allow for microgrids, which will reduce demand on the full grid.
The agreement also supports the District’s goal to become a more sustainable city by creating new investments in solar and wind power, energy efficiency programs, and green infrastructure initiatives. In addition to making $17 million in green energy investments, Exelon has committed to buy 100 megawatts of wind power for the District.
“My Administration has been working hard to advance an energy agenda that positions the District for the future,” said Mayor Bowser. “Our energy needs and our environmental concerns go hand-in-hand. We are launching new programs and initiatives - rethinking how we bring green, affordable energy to all 8 wards. But we need also need a utility system that helps us get there. And I believe the Pepco Exelon merger is a big step in the right direction.”
The merger will have a positive economic impact on DC - producing good-paying jobs, provide workforce training, and creating meaningful pathways to the middle class for District residents.
The District’s People’s Counsel, Sandra Mattavous-Frye, said, “Throughout this application process, I have said that any utility operating in the District must provide lasting, tangible benefits to District ratepayers and residents. As a result, the applicants made major concessions important to ratepayers and to OPC, including immediate rate relief, firm and trackable reliability commitments, low-income consumer protections and jobs. It is good for everyday consumers. Just as important, the proposal also promotes major renewable and sustainable energy policies. The bottom line is that the settlement improves on what we asked for and what Exelon proposed to provide.”
The proposal will now go to the Public Service Commission for public review and comment. The Commission will continue to have an open and transparent process that encourages further input from the public.
To view details of the agreement, go here.