Conflict of Interest by Maryland Regulator Should Prompt Reconsideration of Commission’s Approval of Exelon-Pepco Merger, Public Citizen Tells Court

June 23, 2015

Conflict of Interest by Maryland Regulator Should Prompt Reconsideration of Commission’s Approval of Exelon-Pepco Merger, Public Citizen Tells Court

Days After Casting Deciding Vote to Approve Exelon’s Acquisition of Pepco, Maryland Public Service Commissioner Took Job With Exelon-Funded Group

WASHINGTON, D.C. – Citing an apparent conflict of interest of a commissioner who voted for Exelon’s takeover of Pepco, Public Citizen is calling for a court to review the Maryland Public Service Commission’s (PSC) vote to approve the merger.

Public Citizen late Monday sent a petition (PDF) for judicial review to the Circuit Court for Queen Anne’s County. The organization wants the court to review the PSC’s May 15 decision to approve Exelon Corp.’s acquisition of Pepco. The PSC voted 3-2, with then-Commissioner Kelly Speakes-Backman casting a deciding vote in favor of Exelon’s purchase.

Just days later, on May 28, the Alliance to Save Energy (ASE) announced it had hired Speakes-Backman as the company’s senior vice president of policy and research.

ASE has direct and significant financial ties to Exelon Corp. Exelon’s senior executive vice president and chief strategy officer, William Von Hoene, serves as the first vice chair of ASE’s board of directors.

In addition, Exelon’s Von Hoene serves as one of only five members of “The Honorable Charles H. Percy Society,” the highest level of ASE’s leadership giving program, in recognition of Exelon’s financial support of ASE.

Public Citizen learned that Speakes-Backman began the process of interviewing with ASE for employment as early as February 2015.

“Speakes-Backman’s failure to recuse herself from voting on the Exelon-Pepco merger while negotiating employment with an organization tied to and financed by Exelon Corp. constitutes a clear conflict of interest,” said Tyson Slocum, director of Public Citizen’s Energy Program. “As a result, the court must invalidate the PSC’s approval of the Exelon-Pepco transaction, and remand it back to the commission for reconsideration.”

Slocum noted that Susan Tierney, Ph.D., one of the witnesses for Exelon whose testimony focused on economic and policy benefits of the transaction, is listed on the website of the Alliance to Save Energy as a board member.

Public Citizen was an intervenor in the initial case to determine whether the acquisition of Pepco by Exelon was consistent with the public interest. Along with the Maryland Attorney General, the Maryland People’s Counsel, nine Montgomery County Councilmembers and a number of public interest groups, Public Citizen called on the commission to reject the merger after determining that it would lead to higher electric bills and would hamper efforts to boost the use of renewable energy.

“The evidence of this case alone is grounds for blocking the merger, but the alleged impropriety by which it was approved demands that this case be returned to the Maryland Public Service Commission,” Slocum said.

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