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Jeanette M. Mills, who has 25 years with BGE, is one of Hogan’s two choices for the PSC, which regulates utilities. (File photo)

Hogan delays new PSC appointments until merger decision

ANNAPOLIS — Gov. Larry Hogan has delayed the appointment of two new members of the Public Service Commission until the five-member board issues a decision on the proposed merger between Exelon and Pepco.

The potential appointments of Jeannette M. Mills and Michael L. Higgs Jr. raised the eyebrows of some merger opponents because they not only came at a time when the panel had already heard arguments on the proposed merger but also because the appointment of Mills would result in two former employees of BGE on the commission.

“It’s a stay-the-course kind of maneuver to let it play out without our office having a direct effect over it,” said Douglass Mayer, a Hogan spokesman.

“The governor has been very clear that the Exelon merger, those talks happened before he got in and this is a continuation of that,” Mayer said.

The commission has already held hearings on the proposed merger and is expected to issue a decision on April 8, in the waning days of the 2015 General Assembly session.

Exelon is seeking to acquire Pepco Holdings in a $6.8 billion deal. Included in that deal is the utility company that serves 500,000 people in the suburbs of Washington, D.C.; Delmarva power, which serves 1.4 million people in Delaware and the Eastern Shore of Maryland; and Atlantic City Electric in southern New Jersey.

In addition to Maryland’s PSC, the proposed merger will need the approval of other regulatory bodies in each state where Pepco operates as well as federal regulators.

The appointments to the commission, which were two of more than 330 delivered to the Senate by Hogan on Feb. 20, raised concerns among some opponents of the merger both because of the timing and because Mills, a former executive vice president with 25 years of experience at BGE, would replace Kelly Speakes-Backman.

Speakes-Backman, a former director of clean energy at the Maryland Energy Administration, was appointed to the commission by Gov. Martin J. O’Malley.

The appointment of Mills prior to the merger decision would have meant that two former employees of BGE, which is owned by Exelon, would be on the commission. Already serving on the board is Harold D. Williams, who had a 20-year career with the utility company.

Higgs, a lawyer and former staffer for Republican former Rep. Connie Morella, would replace Lawrence Brenner, a former deputy chief administrative law judge for the Federal Energy Regulatory Commission.

“I’m glad that they’re addressing the potential conflict of interest, but I don’t think that conflict disappears after this merger decision,” said Emily Scarr, director of the Maryland Public Interest Research Group.

MaryPIRG is part of a coalition of organizations opposing the merger on the grounds that that it would not serve the public interest to have one company controlling service to about 8o percent of the state’s population. Additionally, the group has raised concerns about what it says is Exelon’s poor track record on renewable energy sources including wind and solar power.

The merger is also opposed by Attorney General Brian E. Frosh who, in a brief filed with the commission earlier this month, said the proposed merger was not in the public interest.

“We are confident that the current commissioners will render an objective decision that is in the best interests of the public and Pepco Holdings customers,” said Paul Adams, an Exelon spokesman. “With respect to future appointments, it is customary for governors to look to individuals with a variety of backgrounds, and that has historically included individuals with industry experience.”

Scarr said there is still concern over having two former BGE employees on the commission.

“It’s a huge concern to have two of five decision makers be former employees of BGE,” Scarr said. “It would be a concern to have to members of any sector let alone two previous utility employees.”