Saturday, June 13, 2009

MD Attorney General: Constellation Cannot Sue MD PSC

The Maryland Attorney General has decided that Constellation Energy cannot appeal a ruling by Maryland's Public Service Commission to review a deal with Electricite de France (EdF). Constellation Energy immediately appealed Thursday after the PSC ruled that it has the right to sign off on EdF's plan to buy half of Constellation nuclear power business. The Office of the Attorney General filed a motion to dismiss. The PSC rejected arguments that its approval was not necessary for the $4.5 billion deal. Constellation is not regulated by the PSC, but its Baltimore Gas and Electric utility is regulated.

The Center supports the construction of a third reactor at Calvert Cliffs.

Governor Martin O'Malley supports a third reactor at Calvert Cliffs and opposes the review. Yet the PSC wants to assure that the does not meet the definition of substantial influence under last year's settlement. Yet maybe the PSC's concern is legitimate in general because of the high front end cost of building a nuclear power plant. The PSC is concerented that EdF might be forced to squeeze the nuclear operations for cash, leaving Constellation to squeeze BGE for cash, and in turn putting pressure on rates. A potential $87 million payout to Constellation Chief Executive Mayo A. Shattuck III, is also another concern of the PSC. Wow.

Constellation Energy's nuclear business includes three nuclear power stations (one in MD and two in NY) with two reactors in Maryland and three reactors in New York. Nuclear power accounts for 61 percent of Constellation's total electricity generating capacity. BGE accounts for 25 percent of Constellation's earnings and is responsible for 50 percent of the stock's 96 cents a share dividend. More (Wash Post, 6/12/09)

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