GSA asks regulators to reject Pepco-Exelon deal
The U.S. agency that pays the government’s electric bills and is the largest consumer of energy in the nation’s capital has urged D.C. regulators to reject a multibillion-dollar utility industry merger unless it provides a better deal for U.S. taxpayers, according to a new filing in the case.
Attorneys for the General Services Administration wrote that the proposed merger of D.C.-based Pepco and Chicago-based nuclear energy giant Exelon fails a key test: to treat large energy users — like the federal government — fairly. The deal subsidizes the rates of residential customers at the expense of federal taxpayers and, therefore, “should be found not to be in the public interest” unless changes are made, the agency said in the filings reviewed by The Washington Post.
The GSA’s decision, made in an “initial brief” filing, is not a formal statement of opposition. But it surprised opponents of the proposed $6.4 billion deal, which would create the largest electric utility holding company in the country.
“We’re super-excited. I did not see it coming,” said Anya Schoolman, who has helped lead an energetic but poorly funded group of environmentalists and clean-energy advocates against the merger. Schoolman said the GSA filing puts the city’s largest electric customer squarely against key parts of the agreement and raises a new question about whether the D.C. Public Service Commission could reject parts of the plan or modify it.
“Exelon has been saying it’s all or nothing, take it or leave it,” she said of the compromise negotiated by Mayor Muriel E. Bowser’s office. “So we’re going to advocate for leaving it.”
The GSA’s decision represents a reversal of what the agency has said its role is in evaluating the merger. In interviews, GSA officials had said the merger evaluation period is not the time for the agency to make a stand on fighting disproportionate rates for commercial customers. But the filing Wednesday takes a different tack, saying that commercial ratepayers should be compensated for the merger to go through.