League applauds rejection of Pepco-Exelon merger

Letter to Mary Muriel Bowser on the proposed Pepco-Exelon Merger

March 7, 2016

Dear Mayor Bowser:

League presidents wrote twice in 2015 advocating that the proposed Exelon-Pepco merger be dismissed.  Today I write in appreciation of your March 1 announcement that you would not accept the alternative settlement proposed by the Public Service Commission on February 26. 

We continue to believe that the merger is not in the best interests of the citizens of the District of Columbia.  The heart of the matter is that Exelon business practices are in direct conflict with the District’s intent to become more energy efficient. Our original misgivings have been increased by the intense campaign Pepco and Exelon have waged via paid advertisements and social media. And the alternative settlement proposed by the PSC might have worsened the situation.  It appears that some of the improvements your administration negotiated such as rate increase protection and the $9 million contribution to the Low-Income Home Energy Assistance Protection would be removed. Rates would increase for all and most of all for those least able to afford increases.

We believe that objections the Public Service Commission voiced in August are still major concerns.  As Chair Betty Ann Kane noted, the merger results in a “membership structure that is an inherent conflict of interest and that it takes it in the opposite direction from its sole focus on being a distribution company as required by the District's restructuring law and policy.”

The League of Women Voters supports action by appropriate levels of government to encourage the use of renewable resources and energy conservation through funding for research and development, financial incentives, rate-setting policies, and mandatory standards.  As a result of your negotiations, Exelon said it will be an “enthusiastic partner” in DC’s initiatives and promised investments in renewable projects.  Their statements are, however, not binding.  Further, most of the other measures would rely on approval of rate increases to fund them.

The PSC found in August that the proposed merger would result in an increased regulatory burden because of the additional levels of corporate structure.  Although Exelon now agrees to submit to PSC jurisdiction and to provide PSC access to corporate records, there is no indication that the increased burden would be mitigated. For these and other reasons related to employment of DC residents, philanthropy, and public safety, the League of Women Voters of the District of Columbia applauds your decision to reject the proposed merger of Exelon and Pepco.


Linda Beebe, President

League of Women Voters, District of Columbia