Exelon Corp. overcame one hurdle in its proposed merger with Pepco Holdings Inc., announcing Friday that it had reached a settlement with advocacy groups and other parties in Delaware in the merger case before state regulators there.
The settlement agreement, between the Chicago-based parent of Baltimore Gas & Electric Co. and parties that include Delaware Public Service Commission staff, still must be approved by the commission itself.
But the settlement clears a path for approval in Delaware, leaving Maryland and Washington still mulling Exelon's merger with the parent of utilities Pepco, Delmarva Power and Atlantic City Electric. The deal already has been approved by other regulatory agencies including the New Jersey Public Service Commission and the Federal Energy Regulatory Commission.
The proposed merger would make Exelon one of the nation's largest utility companies. The company argues the merger will improve reliability and cost-efficiency for BGE and Pepco customers. Some advocacy groups are skeptical of the proposal, which they believe will result in rate hikes, among other concerns.
The settlement in Delaware includes a fund of $49 million for customer bill credits, new reliability standards and spending on energy efficiency programs for low-income customers. Exelon has proposed $50 bill credits for Pepco's Maryland customers as a result of the merger, among other commitments.
Chicago-based Exelon also reported Friday that its earnings plunged to $18 million in the fourth quarter of 2014, down from $496 million in the last three months of 2013, as warm weather in some of its operating areas suppressed energy consumption. Earnings at BGE rose to $52 million in the quarter, up from $47 million a year earlier.
Exelon shares fell 2.7 percent to close at $33.51 each Friday.