Mayor Muriel Bowser was wrong to claim that a D.C. government settlement with Exelon in its bid to take over Pepco will put D.C. and its residents first. It does not.
Allowing Exelon to keep its failed deal alive after the D.C. Public Service Commission rejected it puts corporate profits ahead of the public interest.
The mayor is touting this settlement as a remedy to the proposal that the PSC rejected for failing to be in the public interest. It is not a remedy. The new settlement terms are only modest, superficial changes that fall far short of the PSC’s mandate that the merger serve the public interest.
The small changes fail to effectively counter the acquisition’s fatal flaw: Exelon’s business model and practices are at odds with Pepco’s ability to serve D.C.’s consumers. Exelon’s business model – which seeks to balance losses experienced in its wholesale power plant division with Pepco’s guaranteed revenue – is in conflict with the best interests of Pepco customers and is misaligned with the District’s clean energy goals. Commitments to address that conflict of interest are inadequate.
An increase in a community investment fund negotiated by the D.C. government to offset increased rates and risks expected from the merger amounts to little more than a fraction of the windfall Pepco shareholders would see if this deal goes through.
This is not a win for D.C. residents. The true victory for the District came in August when, after more than a year of public process and deliberation, the PSC unanimously voted to reject Exelon’s proposed takeover of Pepco. This settlement betrays that process, does little to mitigate the inherent problems the takeover poses to ratepayers and the District’s clean energy future, and, if approved, will serve as D.C.’s first taste of how Exelon wields its money and influence to get what it wants.
Public Citizen is calling on the PSC to treat the settlement as a new application, allowing the public full scrutiny and review of the deal, and to reject an attempt by the settling parties to expedite the process.