PSC aims at compromise
The Maryland Public Service Commission issued its much-anticipated approval of the sale of Constellation Energy Group's nuclear assets to EDF Friday afternoon with conditions that look a great deal like half a loaf.
Constellation's first reaction was about as non-committal as humanly possible. The official statement acknowledged only that the company had received the order and was reviewing it. Well, guess the cross-town traffic didn't get in the way of delivery.
More interesting, however, is how the PSC has ordered CEG to come up with $110 million in one-time rate relief (about $100 for the average Baltimore Gas & Electric customer) instead of the $200 million Gov. Martin O'Malley had sought. Where did the figure come from? Easy. Staff just added up all the sweeteners EDF has already offered from a visitors center at Calvert Cliffs to charitable donations.
Sweet.
The order also includes much of what everyone involved expected -- ring-fencing around the utility and more capital dedicated to BGE to protect the company from its parent and its parent's finances. But as with any complex financial matter, the devil is in the details and it will take time for all parties to review the specifics.
In one other matter of note, it appears the PSC thinks the community is in danger of getting hoodwinked over any expansion of the Calvert Cliffs nuclear plant. Consider this quote from the order:
"We have focused, as we must, entirely on BGE and the impact of this Transaction on that utility and its ratepayers - not because we are disinterested in addressing or unwilling to solve other problems, but because the law prescribes a specific task for us here. It is unfortunate, though, if public officials, unions, churches, Chambers of Commerce, business owners, the press and, most of all, the Companies' employees have been (mis)led to believe that our decision approving this Transaction guarantees that Calvert Cliffs 3 will be built."
Condescending enough for you? What CEG officials have said repeatedly is that if the $4.5 billion sale of nuclear assets was not approved, the Calvert Cliffs project could not go forward. Not sure what's misleading about that. For the record, let's also acknowledge that if the company says tomorrow that Calvert Cliffs 3 will definitely be built, we'd take that with a grain of salt, too.
Comments
In an editorial on Tuesday, the Sun wrote, "there are also rewards - 4,000 construction jobs, 400 permanent jobs and a source of power for 1.3 million homes if the deal makes possible the planned expansion at Calvert Cliffs Nuclear Power Plant." Looks pretty hoodwinked to me.
(Still don't see it. Sentence seems to be as true today as it was when first printed. Calvert Cliffs was at stake and still is. Nobody knows yet how CEG and EDF will react to the order. What I see is the word, "if," featured prominently iin the sentence. PJ)
Posted by: balt moron | October 30, 2009 5:44 PM
So maybe The Sun wasn't hoodwinked (though the articles you published indicated otherwise). Sure looks like the Post was:
Third reactor at Calvert Cliffs moves forward
Constellation, EDF finish $4.5 billion deal
By Christy Goodman
Washington Post Staff Writer
Sunday, November 8, 2009
The boards of Constellation Energy and EDF on Friday completed a $4.5 billion transaction, securing a future for the proposed third reactor at Calvert Cliffs Nuclear Plant.
Posted by: balt moron | November 12, 2009 10:15 AM