Constellation Energy Group and France’s EDF agreed Monday to conditions set by Maryland regulators to move forward with a $4.5 billion joint nuclear venture.
Constellation said that it had received approval from its board and that the Baltimore-based company is “now moving to close the transaction as quickly as possible.”
EDF is seeking to acquire nearly half of Constellation’s nuclear assets. Constellation has said the joint venture with EDF will enable it to build a third reactor at the Calvert Cliffs Nuclear Power Plant in Lusby in Southern Maryland to meet future energy demands.
The Maryland Public Service Commission included several conditions to approving the deal on Friday in the venture’s last regulatory hurdle. The U.S. Nuclear Regulatory Commission approved the deal last month.
As one of the conditions, the PSC set a one-time, $110.5 million credit for customers of Baltimore Gas & Electric, a subsidiary of Constellation that is regulated by the commission. The credit will amount to about a $100 break for each BGE customer.
Maryland regulators also are requiring Constellation to invest $250 million in the subsidiary by June 30. Constellation also must implement bankruptcy-protection measures regarding BGE to ensure neither company is completely dependent upon the other in case of failure. The idea is to financially separate a regulated utility from a non-regulated parent company.
BGE serves about 1.2 million businesses and residential electric customers in Baltimore and central Maryland.
Gov. Martin O’Malley, a Democrat, has been at odds with Constellation over rate increases and executive compensation. The governor initially wanted the credit for BGE customers to be twice the amount set by the PSC. But he described the PSC’s conditions as “fair and reasonable” after they were made public on Friday.
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