Energy East, Iberdola merger gets go-ahead from NY regulator

By Susanna Moon

Chicago, Sept. 3 - Energy East Corp.'s acquisition of Iberdrola SA was approved by the New York State Public Service Commission.

"Determining whether a company should have the privilege to operate a utility franchise in New York is a paramount responsibility of the commission, and it's a responsibility we exercise with great caution, and only after thorough review, careful thought and much deliberation," commission chairman Garry Brown said in a press release.

"Millions of people who depend on safe and reliable utility service at just and reasonable rates should expect nothing less; and the acquisition approved today, with necessary conditions, will do just that," Brown added.

The commission will require that Energy East's affiliates New York State Electric & Gas Corp. and Rochester Gas and Electric Corp. provide $275 million in benefits to gas and electric customers either by reduced rates or smaller increases. The measure was intended to insure customers share in the synergy and efficiency benefits of the merger.

The two utilities will also be required to maintain current levels of planned capital investment.

Iberdrola will be allowed to own wind generation, but with conditions to prevent it exerting "vertical market power." In addition, it will be required to invest a further $100 million in wind generation on top of the $100 million already committed.

The Spanish company's offer to divest fossil fuel plants was accepted.

On Aug. 19, the Federal Trade Commission granted early termination of the Hart-Scott-Rodino antitrust review period in the proposed merger of Energy East Corp. and Iberdola, SA, according to a government release.

More than one year ago it was reported that Iberdrola agreed to acquire Energy East in a transaction valued at $8.6 billion, or $28.50 per share.

Energy East is a utility company based in New Gloucester, Maine, and Iberdrola is a utility located in Bilbao, Spain.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.