Mayor Bowser is Blocking for Exelon’s End Run

Despite fierce public opposition and a decision by the D.C. Public Service Commission (PSC) to deny Exelon’s acquisition of Pepco, Mayor Muriel Bowser cut a deal with Exelon that would allow the Chicago-based corporation to take over Pepco.

And while the mayor, with Exelon’s CEO at her side, was announcing the deal on October 6, the mega-utility’s lawyers were filing a motion insisting that the D.C. PSC fast track the approval of the takeover.

Specifically, Exelon is asking the PSC to reopen the merger case and consider the settlement as part of the original proposal rather than filing a new application.

This is significant because: exelon sm black x

If successful, it would allow the mayor’s backroom deal to further erode the public process that resulted in regulators rejecting the takeover. The initial proposal was reviewed and deliberated over for nearly a year and included several public hearings and an ample public comment period that led the commission to declare that the proceedings generated more interest and more active participation by the public – which largely opposes the merger – than any other proceeding in the commission’s 100-plus years of operations.

It is perhaps this demonstrated public interest and opposition to the takeover that is driving Exelon to push for an expedited review that cuts out the public. Exelon’s request would likely mean no new public hearings and, if granted, a truncated public comment period.

Exelon’s fact track motion coupled with the mayor’s backroom negotiations could shatter the public trust in the very processes established to protect energy consumers in the District.

It represents a significant flip-flop by Mayor Bowser. On September 28, just days before the settlement was announced, the mayor’s office confirmed that it was negotiating a deal with Exelon and stated that the government would support the treatment of any settlement with Exelon as a new application that would “be presented to the PSC for review, public comment and final determination.”

But at Exelon’s bequest, the mayor has abandoned that commitment and has filed a letter in support of Exelon’s fast track scheme.

It demonstrates Exelon’s deftness in manipulating D.C. regulatory rules to suit its purpose. D.C. municipal regulations clearly state that settlement agreements can be submitted only prior to the issuance of a final decision.

Exelon argues in its motion that the PSC’s final order to reject the merger is not actually final because Exelon still has an opportunity to ask the PSC to reconsider its decision and that the PSC’s response to its request for reconsideration would constitute finality of the case. It is at this point that Exelon’s argument takes a trip down the rabbit hole, since appeals for reconsideration can only be heard on the record before the commission, where no new or additional evidence is to be received – such as presumable a package of new conditions to the existing proposal.

It is perhaps this apparent misinterpretation of the law that brings Exelon to its final argument: “The commission can and should waive any rule that stands as an obstacle.”

Exelon, with an assist by the mayor, is clearly attempting an end run around established D.C. PSC procedure – and should be stopped from setting a dangerous precedent.

Responses to Exelon’s motion are due today. It is important to note that only interveners to the takeover proceeds can formally respond. Attempts by the public to weigh in on Exelon’s fast track scheme have been denied by the PSC because, as the agency notes, it cannot accept public comments because the record has been closed.

Public Citizen is calling on the PSC to deliver the same message to Exelon and force it to file a new application and submit to a new proceeding that allows the public to fully scrutinize the negotiated deal between Exelon and the mayor. And we are calling out Mayor Bowser for reneging on your commitment to support a full public review process.

Allison Fisher is the Outreach Director for Public Citizen’s Climate and Energy Program