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ConEd-O&R Merger Gets Nod from FERC

ConEd-O&R Merger Gets Nod from FERC

FERC last week gave the green light to the merger between New York-based Consolidated Edison Inc. and neighboring Orange and Rockland Utilities (O&ampR), moving them a step closer to becoming one of the most formidable electric and gas utility competitors in the east. The deal, which has been valued at $790 million, is expected to be completed by mid-year - assuming the regulatory approvals of other federal and state agencies are forthcoming.

Based on each company's power-generation divestiture plans and certain mitigation commitments, "we believe the proposed merger will not have an adverse effect on competition," the FERC order said [EC98-62]. The combined company will serve nearly 3.3 million electric customers and 1.2 million gas customers in southern New York, northern New Jersey and northeastern Pennsylvania.

Consolidated Edison Co. of New York (ConEd), a wholly-owned utility subsidiary of Consolidated Edison, told FERC it expects to auction off most of its generation capacity in three separate bundles by the end of the first quarter. The bundles include: 1) its Arthur Kill generating station and Astoria gas turbines (1,434 MW); 2) its Ravenswood generating station and gas turbines (2,168 MW); and 3) its Astoria generating station, and Gowanus and Narrows turbines (1,858 MW). It also proposes to later auction off a fourth bundle (463 MW) of generating capacity in New York City.

O&ampR, an exempt public utility holding company that serves electric and gas customers in New York, also is in the process of divesting its generation capacity. It expects to have its generation capacity auctioned off in four bundles by the end of May. The bundles include: 1) its Bowline Point station; 2) its Lovett station; 3) hydroelectric facilities; and 4) gas turbines. Both ConEd's and O&ampR's generation divestiture plans have been approved by the New York Public Service Commission.

Following the merger, the surviving corporation will be Consolidated Edison Inc. O&ampR will become a wholly-owned utility subsidiary of Edison, apart from ConEd. O&ampR's Rockland Electric Co. in New Jersey and Pike County Light and Power in Pennsylvania will continue as its subsidiaries.

Susan Parker

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