After a long week of grueling testimony on Constellation Energy Group's proposed nuclear joint venture with a French partner, the regulatory review will continue into next week, a hurdle that both companies had not expected when they signed the deal last year.
The state Public Service Commission heard from more than 10 witnesses in late-night sessions on whether the $4.5 billion sale of nearly half of Constellation's nuclear power business to Electricite de France would hurt Constellation's regulated utility, Baltimore Gas and Electric Co., and its customers.
In particular, the proposed third nuclear reactor at Calvert Cliffs in Southern Maryland has become the dominant point of contention between the state and the two companies.
Several witnesses for EDF and Constellation said the deal would create benefits for Maryland and BGE customers, including $1.8 billion to $2.7 billion in savings from lower electricity prices because of construction of the new reactor; $130 million in tax revenue; new jobs and private investment in Maryland's energy infrastructure.
But the state and the Maryland Office of the People's Counsel dispute claims that the deal would create direct benefits for BGE ratepayers, as required under state law.
An outside expert hired by the PSC staff, however, came to the opposite conclusion, finding that the deal would produce benefits ranging from $474 million to $985 million to BGE customers based on several factors, including the completion of the new reactor.
The hearings are to resume Monday, at least a day longer than expected.
Gov. Martin O'Malley said in an op-ed column in The Baltimore Sun this week that "under the right circumstances, a new nuclear unit at Calvert Cliffs could very well be a good thing - but only if ratepayers are protected."
He reiterated concerns expressed by the state and other opponents during the proceedings: that the costs of the Calvert Cliffs project would divert resources away from BGE and that the utility would be exposed to risks associated with the new nuclear development. EDF and Constellation reject such concerns. Constellation said it would not pursue the project at all costs. And neither company has committed to building the third nuclear unit.
Still, an EDF executive testified this week that the French utility would abandon the nuclear project if the PSC blocks the transaction or places excessive conditions.
