On February 28, Maryland’s Prince George’s County Council passed a resolution in support of the combination of AltaGas Ltd. and WGL Holdings, Inc. The resolution recommends that the Maryland Public Service Commission approve the combination as it is in the public interest, meets the convenience and necessity tests, and provides benefits and no harm to Maryland ratepayers. The resolution is a positive development in the regulatory review process, and follows on support by the Maryland Energy Administration, Prince George’s County Executive Rushern Baker, and Montgomery Council Executive Ike Leggett.
On March 1, AltaGas and WGL, parent company of Washington Gas, filed a post-settlement brief, which summarizes evidence presented February 6-9 to the Maryland Public Service Commission during evidentiary hearings that were held to consider the settlement agreement the companies reached in December 2017, with the Maryland Energy Administration (“MEA”), Montgomery County, Prince George’s County, and the Laborers’ International Union of North America, its affiliated District Council, and Local Unions serving or located in Washington D.C. (collectively, LiUNA).
AltaGas and WGL’s brief re-affirms the companies’ position that the settlement enhances the robust package of merger commitments that deliver substantial customer benefits, advance Maryland’s multi-faceted energy policy goals, and ensure Washington Gas’ future success. The positive impacts that would result from the combination have been validated through the numerous and diverse public endorsements that have been received from the public and community leaders, who recognize that this combination presents a unique opportunity for long-term growth in the State of Maryland.
As part of the agreement, AltaGas and WGL have committed $103 million to expand natural gas infrastructure in Maryland.
Washington Gas will invest $70 million of this amount over a 10-year period to further extend natural gas service to unserved and underserved areas by adding to regulated assets within the Washington Gas service territory in Maryland. All such proposals will be developed jointly by AltaGas, Washington Gas and the MEA for the Maryland Public Service Commission’s review and approval. The review and approval process before the Commission will be open to all interested parties.
The remaining $33 million will be used to establish the Maryland Gas Expansion Fund, which will be administered by the MEA to promote economic development, job creation and the expansion of natural gas infrastructure to underserved parts of Maryland.
In addition, the Settlement includes terms to help enhance safety and reliability in the delivery of natural gas and the operation of the distribution grid infrastructure, and provides educational programs and job training that promote energy efficiency.
The combination brings to Maryland a tremendous opportunity to expand clean, natural gas as a preferred heating fuel and decrease Maryland’s reliance on oil and coal-generated power. By switching homes to natural gas, an average home will reduce its carbon emissions footprint by 50 percent. The combination of more renewables, more efficient gas usage, and more access to cleaner, less expensive home heating options exemplifies what AltaGas brings to Maryland through this combination.
AltaGas and WGL anticipate receiving a final order and decision by April 4 from the Maryland Public Service Commission.
The combination has received the following approvals:
- Approval from WGL Holdings, Inc. shareholders on May 10, 2017.
- Approval from the Federal Energy Regulatory Commission (FERC), an independent agency that regulates the interstate transmission of natural gas, electricity and oil, on July 6, 2017;
- Expiration of the waiting period as of July 17, 2017, pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act), when the merger was deemed approved by the Federal Trade Commission and the Department of Justice; and
- Approval from the Committee on Foreign Investment in the United States (CFIUS) on July 28, 2017.
- Approval from the Virginia State Corporation Commission on October 20, 2017.
In addition to the Maryland PSC decision in April, the District of Columbia Public Service Commission is expected to issue a decision in the first half of 2018.