PSC allows deal, but will companies follow through?
If Constellation Energy and/or Electricite de France really want to consummate the expansion of their nuclear-energy venture, the Maryland Public Service Commission just made it possible. The PSC would require $110 million in rebates for residential BGE customers as part of the deal. And it wants Constellation to make a $250 million investment into Baltimore Gas & Electric to boost its capital. It also wants to start the process of installing new legal barriers between BGE and Constellation.
But the conditions fall short of what was requested by Gov. Martin O'Malley. He wanted a customer rebate more than twice as big as what the PSC is requiring. And he wanted some kind of restriction or other action on the pay of Constellation CEO Mayo Shattuck. But the PSC took a pass on Shattuck's pay, as it should have. "But even if we might, as individuals, question the wisdom of paying anyone millions of dollars a year given CEG's recent history, it is our role as Commissioners to focus on BGE and its ratepayers," the PSC said in its order.
The conditions don't seem to be deal-killers if Constellation and EDF really want to go through with the transaction. Given recent reports that EDF's new CEO has doubts about the deal, and given that Constellation doesn't need EDF's money as much as it once did, that is very much open to question.
Comments
Anyone want to start a pool on when the groundbreaking for the (EDF designed and financed) CC3 reactor will happen?
me either.
Posted by: MrRational | October 30, 2009 1:51 PM
I just wish something would happen soon. If CEG has the where with all to build the third reactor without EDF then so be it, but lets get off the dime here. I never thought the PSC would totally go along with MOM's total blackmail idea, and this seems like a reasonable compromise. The new plant will be around for decades and the dollars spent today to get the deal done will seem like a small pittance as time goes bye, bye.
Posted by: reader203 | October 30, 2009 8:23 PM
Non-partisan question here. If no additional electricity generation gets built and electricity rates for Maryland residents are much higher in 10 years who gets the blame?
Posted by: Dan | October 30, 2009 11:23 PM
Dan our electric rates have more than doubled in the past 5 years. Lest we forget the dems control the state and with no limits on shattucks pay. In these bad economic times its B.S that our rates have doubled. The PSC should be investigated i have no issue with companies making money, but the vast majority of states use cost control on utilities especially since theres only 1 major utilitity in the state. we do need more plants or well be like california where the average elec bill is about 450.00 a monthbecause they cant build new electric plants . CEG should be declared an monopoly if MOM had a pair hed offer any other company a 2 BILLION $ credit if they can beat CEG rates by 10 - 20 % .
Posted by: Jon morris | October 31, 2009 1:56 PM
Jay,
Any numbers available on the impact of a 110 million dollar construction project to the state versus the economic impact of 100 dollar one time credit to BGE customers?
Posted by: Waiting for the Sun to set | November 1, 2009 8:48 AM