Constellation Energy gets OK from N.Y. for EDF deal

Tuesday, April 21, 2009, 2:19pm EDT | Modified: Tuesday, April 21, 2009, 2:21pm
Baltimore Business Journal - by Scott Dance Staff
The New York Public Service Commission has approved French utility EDF Group Inc.'s bid to buy 49.99 percent of Constellation Energy Group Inc.'s nuclear business.

The $4.6 billion deal required New York approval because Constellation owns three nuclear reactors in upstate New York. The commission determined Tuesday the sale would not have an impact on ratepayers in the state, according to a news release.

Maryland regulators are in the middle of a similar investigation, to determine whether the deal gives EDF "substantial influence" over Constellation subsidiary Baltimore Gas and Electric Co., Maryland's largest electric utility. A decision is expected in June.

Regulatory hurdles have been a key concern for Constellation in its merger activity. In 2006, state lawmakers thwarted a bid from Florida-based FPL Group Inc. to buy Constellation for $11.5 billion.

State regulators are working with Constellation and EDF to determine first if the deal gives the French company power over BGE, and secondly, if that influence is in the best interest of Maryland residents.

In March, Constellation lawyers told the Maryland Public Service Commission they hoped to gain regulatory approval by the end of May to ensure the process wouldn't derail the EDF deal. The deal is vital in keeping the company financially stable, the lawyers said.

Constellation had taken an emergency $4.7 billion bid from Warren Buffett-owned MidAmerican Energy in the face of a cash crunch in September. Officials rejected that deal in December in favor of EDF's offer.

Constellation Nuclear owns Nine Mile Point Nuclear Unit I and 82 percent of Nine Mile Point Nuclear Unit II in Oswego, N.Y. as well as R.E. Ginna Nuclear Power Plant in Ontario, N.Y.

The company owns two nuclear reactors and has plans for a third by 2016 at Calvert Cliffs in Southern Maryland.

Reader Comments