Skip to main content

Could Exelon Acquistion Of Pepco Mean Local Reliability Improvements?

By WTOP Staff

Flickr photo by Bill in DCPepco Holdings Inc., the company that includes oft-criticized electricity utility Pepco, is being sold to Chicago-based Exelon for $6.8 billion in cash.

It’s unclear what that will mean for Pepco’s customers, many who have complained for years about Pepco’s poor service record. On Wednesday, after the deal was announced, it seems those who watch Pepco issues are optimistic that the deal will bring increased electric reliability to Pepco customers in Montgomery County.

Pepco as a brand will remain and its headquarters will stay in Washington, D.C. Pepco and Exelon leaders said in a conference call on Wednesday it’s still to be seen how the company reorganizes its employee structure.

“Those of us who have endured Pepco’s poor performance could benefit from this transaction if our state regulators insist that Exelon make a binding commitment to dramatically improving reliability,” County Councilmember Roger Berliner said in a statement.

Berliner, an energy lawyer, has led Montgomery County’s efforts to pressure Pepco into improving its infrastructure and reliability, which has come under intense examination during prolonged power outages after powerful storms in the past few years.

“Exelon, owner of Baltimore Gas & Electric, has a better track record than Pepco when it comes to reliability. But we will need our regulators to be strong,” Berliner said. “This potential deal will make Exelon a very dominant force in Maryland’s energy sector and our regulators will have to be much more vigilant than they have been in the past.”

The Maryland Public Service Commission will be one of three state utility regulators that has to sign off on the merger. The D.C. Public Service Commission must also approve the deal.

Pepco Holdings Inc. includes Atlantic City Electric and Delmarva Power. If the deal is approved, Chicago-based Exelon will combine those utilities with Baltimore Gas & Electric and PECO in Philadelphia to form the Mid-Atlantic’s largest gas and electric utility, with an estimated 10 million customers. Exelon also owns ComEd, which serves Chicago and much of Northern Illinois.

Sixth District Rep. John Delaney on Wednesday said he thinks the massive utility company being proposed might bring more investment in infrastructure and more reliability.

“While we look forward to reviewing the details as to how the merger will benefit our constituents, we believe that the scale created by this business combination can be used to increase investment in the service area, which can drive higher levels of reliability and we are encouraged by Exelon and Pepco’s joint commitment to focus on customer service through the transition,” Delaney said in a statement.

At the Public Service Commission, hearings on Pepco’s third rate increase request in three years started this month. There’s hope in some circles that the merger might result in a healthier financial outlook for the Pepco, which in turn would mean the end of the near constant string of rate increase requests.

In a Nov. 6 earnings call, outgoing Pepco Chairman Joseph Rigby told investors the PSC’s decision to grant $27.9 million of its $60.8 million rate hike request last time around meant the company must make another request.

Abbe Milstein, founder of the Powerupmontco group and a frequent critic of Pepco, said she hopes Montgomery County uses the merger as a way to get rid of its “long outdated” franchise agreement with Pepco.

That agreement makes the utility virtually immune from liability on safety issues and some issues of electric reliability. The utility has a state-regulated monopoly in Washington D.C. and most of Montgomery County.

“My hope would be at this point that some on the County Council would see this as an opportunity to get involved at the Public Service Commission merger hearings,” Milstein said. “This is an opportunity to make a real claim not just for reliability but for not giving Exelon this virtual immunity on liability issues. That’s how you make them accountable. That’s how you increase reliability. You can’t just kind of wish on a star that they make that happen. We don’t know.”

The purchase would include a $100 million in customer improvement fund that could be used for rate credits, energy efficiency programs and low-income customer assistance across the company’s many coverage areas.

ComEd and PECO are delivering first-quartile performance, according to reliability rankings, and BGE’s rating has risen to its best-ever levels since Exelon bought BGE in 2012.

Exelon will pay $27.25 per share for all outstanding Pepco Holdings stock, a 24.7 percent premium over the stock’s April 25 closing price.

“This is just a tremendous win for our employees, our customers and our investors,” Rigby said on the conference call.

Flickr photo by Bill in DC

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
Read Next Story

Related News

Frustration grows in Venezuela as earthquake death toll reaches 1,430

Israel and Lebanon sign framework agreement with US in ‘first step’ toward peace, Rubio says

Trump-endorsed populist poised to become Colombia’s next president as rival challenges vote