The mayor of Washington, D.C. made a tentative deal with Exelon Corp. regarding the utility’s merger with Pepco Holdings Inc., people close to the discussions told Bloomberg Business News.
The office of Mayor Muriel Bowser presented this reported deal to interested groups. The deal includes more customer credits than pitched in Exelon/Pepco’s original deal, which the District of Columbia Public Service Commission rejected in late August.
The deal would also require the combined company to establish a secondary headquarters in Washington, D.C., where Pepco already has its headquarters.
The Bloomberg report is based on sources who spoke anonymously due to the private nature of the deal. Neither Exelon nor Pepco have spoken publicly about the deal as of press time.
Washington, D.C. remains the final hurdle for the merger after a wave of approvals from other East Coast regulatory boards in Maryland, New Jersey and Delaware, and the Federal Energy Regulatory Commission.
The combined utility businesses would serve about 10 million customers and have a rate base of about $26 billion. The purchase deal was worth about $6.8 billion.
The combination of the companies would bring together Exelon’s three electric and gas utilities — BGE, ComEd and PECO — and Pepco Holdings’ three electric and gas utilities — Atlantic City Electric, Delmarva Power and Pepco — to create one of the largest electric and gas utilities in the country.
Last month, Exelon and Pepco jointly submitted for the D.C. PSC to reconsider their merger. Any settlement agreement with the mayor’s office would be presented in a new application to the PSC for review, public comment and final determination.
“We remain convinced our merger offers significant benefits to customers and the District, and we continue working to complete it,” said Chris Crane, president and CEO of Exelon in late September. “Since the Public Service Commission explained why it didn’t approve the merger last month, we’ve worked to learn what’s most important to the District – and we are responding.”