Constellation Energy Group and Exelon Corp. have agreed to additional concessions to alleviate concerns over market power in the mid-Atlantic's electricity grid under the companies' plan to merge, according to documents filed Tuesday with federal and state energy regulators.
The settlement satisfies only the concerns raised by the independent market monitor for the PJM market, which initially found that the union between the two companies "would significantly increase concentration" of generator ownership and potentially give the companies the ability to drive up electricity prices.
Other parties — including the state energy administration and the Maryland Office of the People's Counsel, which represents consumers in utility matters — have argued the combined company would have too much control over electricity prices in the market.
The deal requires approval by the Federal Energy Regulatory Commission and the Maryland Public Service Commission, among others.
Anticipating concerns about market share, Constellation and Exelon have announced plans to sell Constellation's three coal-fired plants as part of the merger. The facilities — Brandon Shores and H.A. Wagner in Anne Arundel County and C.P. Crane in Baltimore County — overlap significantly with Exelon's power units in the PJM market, which covers the electricity grid in Maryland and 12 other states.
As part of the settlement, the two companies agreed not to sell those plants to several power companies that have existing generation facilities in the PJM market, including American Electric Power Co., First Energy Corp. and GenOn Energy.