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PSEG first proposed merging in December 2004, the national landscape has changed. Rising wholesale energy prices have put new pressure on wary regula- tors and gathering urgency about global warming has made Exelon’s numerous clean-burning nuclear power plants more valuable. Then in May an influential New York hedge fund manager, Zachary Schreiber, told Exelon the deal as proposed is “aggressively obscene” and a bad one for his fund and other Officially, the two companies still believe merging is the right thing to do for investors and customers. By acquiring PSEG for $16 billion and exchanging 1.25 Exelon shares for each PSEG share, the com- “There is probably better than a 50-50 chance panies believe they would create the top U.S. utility. the merger will be approved — probably with some Exelon would add to its existing 33,290 megawatts token concessions such as additional divestitures,” of generating capacity, including PSEG’s valuable said John P. Hughes, vice president for technical nuclear plants. It will also boost its roster of gas and affairs of the Electricity Consumers Research Council in Washington, an association of big Randy Mehrberg, Exelon’s executive vice industrial electricity users. The council opposes the president, said at a recent investor’s conference call merger and believes its benefits to ratepayers are that only a requirement that the company sell nuclear capacity or a material financial change could force Exelon to back away from its pledge to merge. “At the present time we believe we can get it done; we believe we will get it done in a way that adds value 11 ~ 22 | Contract Compliance,
for shareholders. I don’t want to say in any way that Renegotiation, and Dispute
Resolution for PPP Projects
To view any of these events, please go to So far, the companies have agreed with regula- www.energycentral.com/quicklink and type the tors to a virtual divestiture of 2,600 megawatts of nuclear capacity. PJM, the regional transmission 13 ~ 14 | Emergency
organization, concluded that the divestiture satisfies Identification & Mitigation
its screens for market concentrations.
Legal teams are talking with New Jersey regula- 6 ~ 9 | Utility Working
Conference
18 ~ 19 | Alaska Oil & Gas
tors, the sole regulatory body so far to oppose the Symposium
merger. The U.S. Department of Justice approved the deal in late June but said that the companies 15 ~ 18 | EEI EL&P Task Force to
must sell six power plants that produce 5,600 the National Electric Code
25 ~ 29 | 5-Day Training Program
for Energy Managers
John Rowe, Exelon’s CEO, says rising wholesale energy prices have made regulatory review more TFQUFNCFS!
stringent. “Why is New Jersey hard? Why is Illinois 28 ~ 29 | Increased Grid
(which has approved the merger but required a 7 ~ 8 | EPGA 2006 Power
Reliability for Transmission and
Generation Conference
Distribution 2006
virtual auction of some assets) hard? The answer is simple,” said John Rowe. “Wholesale prices are

Source: http://energycentral.fileburst.com/EnergyBizOnline/2006-4-jul-aug/ebiz070806_67_legal_eagle_exelon_sm.pdf