For Immediate Release
Pepco Holdings Inc. (NYSE: POM)
and Exelon Corporation (NYSE: EXC) today announced they have reached a
settlement with the Government of the District of Columbia and others on the
companies' proposed merger that will deliver substantially enhanced benefits to
consumers and businesses in the District. The settlement package was
specifically shaped to address the concerns articulated by the District of
Columbia Public Service Commission (PSC) in its August order.
The new package of benefits includes
commitments to provide bill credits, low-income assistance, fewer and shorter
outages, a cleaner and greener D.C., and investment in local jobs and the local
economy. Pepco Holdings and Exelon submitted the settlement agreement to the PSC
for approval as part of the existing merger proceeding.
Also signing on to the settlement
agreement are the Office of the People's Counsel and the Office of the Attorney
General of the District of Columbia, as well as the Apartment and Office Building
Association of Metropolitan Washington, the District of Columbia Water and
Sewer Authority, the National Consumer Law Center and the National Housing
heard the Public Service Commission's concerns loud and clear, and this new
merger proposal presents greater benefits to the District," said Chris Crane,
president and CEO of Exelon. "Our settlement includes more than 120 commitments
to ensure the merger is unequivocally in the public interest."
District deserves a healthy utility company that guarantees affordability,
reliability and sustainability for residents and ratepayers," said District of
Columbia Mayor Muriel Bowser. "We kept the conversations with Pepco and
Exelon alive, because we knew we had to do better for the District. My
team negotiated a deal that puts District residents and ratepayers first - by
delivering a public utility that is cost-effective, dependable and
the new proposal, Exelon will more than double direct benefits to customers by
providing $72.8 million for bill credits, low-income assistance, renewable
energy and energy efficiency programs in the District. These funds are expected to offset distribution rate
increases for residential customers through March 2019. Of the direct funds
provided, $16.15 million would be used to help low-income customers.
new proposal meets the needs of families and businesses in the District," said
Joseph Rigby, chairman, president and CEO of Pepco Holdings. "Merging with
Exelon is the only way to provide Pepco customers and communities these
significant benefits, which we believe are too great to forfeit."
Nedwick, Housing and Energy Efficiency Policy Director, National Housing Trust,
said, "The settlement announced today provides meaningful benefits to vulnerable,
low-income District residents. The settlement provides at least $6.75 million
for energy efficiency retrofits to make multifamily homes healthy and
affordable. Energy efficiency in affordable housing lowers utility costs, keeps
housing affordable and reduces greenhouse gases. A triple win."
and Exelon have committed to invest substantially in advancing the District of
Columbia's long-term sustainability goals, including $3.5 million for new
renewable energy and $3.5 million for energy efficiency programs. In addition,
Exelon will significantly expand solar energy in the District by developing up
to 10 megawatts (MW) of new solar generation and making it easier and faster
for customers to install solar panels. Exelon will provide another $5 million
of capital to governmental entities to develop renewable energy in the District
and will purchase 100 MW of wind energy. In addition, Pepco will work with the
District to develop at least four new microgrids.
the enhanced proposal, Pepco will reduce the frequency and duration of power
outages. Pepco's reliability performance will exceed the standards the PSC has
set or the company will face significant financial penalties if it fails to do
so. Pepco is expected to reach these more aggressive goals for reliability
without increasing planned budgets, providing cost protection to customers.
new package of benefits also includes commitments by Pepco Holdings and Exelon
to promote local jobs and an additional $5.2 million for workforce development
in the District.
also will continue Pepco's support for the local community by guaranteeing
charitable contributions in the District of $19 million over 10 years to
nonprofits that serve residents in the District.
Fact Sheet: Merger Settlement With District of Columbia Government
About Exelon Corporation
Exelon Corporation (NYSE: EXC) is the nation's leading competitive
energy provider, with 2014 revenues of approximately $27.4 billion.
Headquartered in Chicago, Exelon does business in 48 states, the District of
Columbia and Canada. Exelon is one of the largest competitive U.S. power generators,
with approximately 32,000 megawatts of owned capacity comprising one of the
nation's cleanest and lowest-cost power generation fleets. The company's
Constellation business unit provides energy products and services to more than
2.5 million residential, public sector and business customers, including more
than two-thirds of the Fortune 100. Exelon's utilities deliver electricity and
natural gas to more than 7.8 million customers in central Maryland (BGE),
northern Illinois (ComEd) and southeastern Pennsylvania (PECO). Follow Exelon
on Twitter @Exelon.
About Pepco Holdings Inc.
Pepco Holdings Inc. is one of the
largest energy delivery companies in the Mid-Atlantic
region, serving about 2 million
customers in Delaware, the
District of Columbia, Maryland and New Jersey.
PHI subsidiaries Pepco,
Delmarva Power and Atlantic
regulated electricity service; Delmarva Power also
gas service. PHI
also provides energy efficiency and renewable energy services through Pepco Energy Services. For more
information, visit online: www.pepcoholdings.com.
Cautionary Statements Regarding
Except for the historical information
contained herein, certain of the matters discussed in this communication
constitute "forward-looking statements" within the meaning of the Securities
Act of 1933 and the Securities Exchange Act of 1934, both as amended by the
Private Securities Litigation Reform Act of 1995. Words such as "may," "might,"
"will," "should," "could," "anticipate," "estimate," "expect," "predict,"
"project," "future," "potential," "intend," "seek to," "plan," "assume,"
"believe," "target," "forecast," "goal," "objective," "continue" or the
negative of such terms or other variations thereof and words and terms of
similar substance used in connection with any discussion of future plans,
actions, or events identify forward-looking statements. These forward-looking
statements include, but are not limited to, statements regarding benefits of
the proposed merger, integration plans and expected synergies, the expected
timing of completion of the transaction, anticipated future financial and
operating performance and results, including estimates for growth. These
statements are based on the current expectations of management of Exelon
Corporation (Exelon) and Pepco Holdings, Inc. (PHI), as applicable. There are a
number of risks and uncertainties that could cause actual results to differ
materially from the forward-looking statements included in this communication.
For example, (1) the uncertainty surrounding reconsideration of the denial of
the Merger application by the DC Public Service Commission may delay the merger
or cause the companies to abandon the merger; (2) conditions to the closing
of the merger may not be satisfied; (3) problems may arise in
successfully integrating the businesses of the companies, which may result in
the combined company not operating as effectively and efficiently as expected;
(4) the combined company may be unable to achieve cost-cutting synergies or
it may take longer than expected to achieve those synergies; (5) the
merger may involve unexpected costs, unexpected liabilities or unexpected
delays, or the effects of purchase accounting may be different from the
companies' expectations; (6) the credit ratings of the combined company
or its subsidiaries may be different from what the companies expect; (7)
the businesses of the companies may suffer as a result of uncertainty
surrounding the merger; (8) the companies may not realize the values
expected to be obtained for properties expected or required to be sold; (9)
the industry may be subject to future regulatory or legislative actions that
could adversely affect the companies; and (10) the companies may be
adversely affected by other economic, business, and/or competitive factors.
Other unknown or unpredictable factors could also have material adverse effects
on future results, performance or achievements of the combined company.
Therefore, forward-looking statements are not guarantees or assurances of
future performance, and actual results could differ materially from those
indicated by the forward-looking statements. Discussions of some of these other
important factors and assumptions are contained in Exelon's and PHI's
respective filings with the Securities and Exchange Commission (SEC), and
available at the SEC's website at www.sec.gov, including: (1) Exelon's 2013 Annual
Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management's
Discussion and Analysis of Financial Condition and Results of Operations and
(c) ITEM 8. Financial Statements and Supplementary Data: Note 22; (2) Exelon's
Second Quarter 2015 Quarterly Report on Form 10-Q in (a) Part II, Other
Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 19;
(3) the definitive proxy statement that PHI filed with the SEC on August 12,
2014 and mailed to its stockholders in connection with the proposed merger (as
supplemented by PHI's Form 8-K filed with the SEC on September 12, 2014); (4)
PHI's 2014 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7.
Management's Discussion and Analysis of Financial Condition and Results of
Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note
15; and (5) PHI's Second Quarter 2015 Quarterly Report on Form 10-Q in (a) PART
I, ITEM 1. Financial Statements, (b) PART I, ITEM 2. Management's Discussion
and Analysis of Financial Condition and Results of Operations. In light of
these risks, uncertainties, assumptions and factors, the forward-looking events
discussed in this communication may not occur. Readers are cautioned not to
place undue reliance on these forward-looking statements, which speak only as of
the date of this communication. Neither Exelon nor PHI undertakes any
obligation to publicly release any revision to its forward-looking statements
to reflect events or circumstances after the date of this communication. New
factors emerge from time to time, and it is not possible for Exelon or PHI to
predict all such factors. Furthermore, it may not be possible to assess the
impact of any such factor on Exelon's or PHI's respective businesses or the
extent to which any factor, or combination of factors, may cause results to
differ materially from those contained in any forward-looking statement. Any
specific factors that may be provided should not be construed as exhaustive.