UPDATED at 10:30 a.m.
WASHINGTON — The D.C. Public Service Commission rejected the Pepco-Exelon merger, but the long-awaited vote means the nearly $6.8 billion deal is not dead yet.
Instead, the deal is on hold.
The vote was 2 -1 to reject settlement terms Mayor Muriel Bowser had negotiated after D.C. regulators last year voted against the merger. Those terms with Chicago-based Exelon would have pumped $78 million in benefits to the city, including one-time credits to ratepayers, job training programs and donations to nonprofits in the District.
The companies will now go back and discuss new conditions set by the Public Service Commission. Exelon had wanted the deal wrapped up by March 4.
The conditions the PSC wants met include the following:
- Exelon must be removed from developing a solar plant at D.C. Water’s Blue Plains facility. Instead, Pepco must identify a developer for the solar plant.
- Exelon/Pepco must put $25.6 million into a customer base rate credit, and the decision on how to parcel out that credit would be held off until the PSC reviews the issue in the future.
- Exelon/Pepco would have to create new funds for modernization of the District’s energy system and come up with money for efficiency projects that would help low and moderate income customers within 60 days.
- A provision to strike as premature Pepco’s role in developing public purpose microgrids.
If the conditions are met within 14 days, the merger would go through without another vote by the PSC.
The merger would create an electric utility with the largest customer base — an estimated 10 million — in the United States.
Critics have said the merger would not be in the public’s interest.
At-Large Councilmember Elissa Silverman released a statement, saying she was disappointed with the decision.
“While the PSC officially rejected the merger, the proposed changes are so minor that the PSC is essentially approving the merger. The four additional conditions that two of the three commissioners want are lipstick on a pig; these terms do not change the fact that this merger is a step backward,” Silverman said.
Four other states, including the District of Columbia’s neighbors in Virginia and Maryland, have already said yes to a deal that would allow Exelon to merge with Pepco.
Last year, when regulators voted against the merger, PSC Chair Betty Ann Kane explained the decision by saying the merger proposal failed one basic test: that it wasn’t in the public’s interest.