In last week’s post, we concluded our article discussing the standards of review used by U.S. state regulators considering utility mergers. In this post, we begin our article by reviewing the use of regulatory commitments and conditions in utility mergers.
To start, let’s answer some defining questions.
What are merger commitments?
Merger commitments are typically made by the buyer and the subject utility(ies) in connection with a merger approval request. Merger commitments may pertain to benefits, protections, or other actions or activities related to the merger. Commitments may be put forth when an approval request is filed, made during a regulatory proceeding in response to issues raised by stakeholders, or the product of settlement agreements with other stakeholders.
What are merger conditions?
Merger conditions are typically part of a Commission order approving a merger request. Merger conditions may include the adoption of merger commitments that are put forth by the buyer and subject utility(ies), the product of a proposed settlement agreement, and/or other conditions deemed necessary by the Commission.
Merger commitments are key contributors to the public interest. While each merger’s regulatory commitments and conditions are based on the facts and circumstances unique to that merger, we can learn from the broader trends. We will explore these trends further in the coming weeks.
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