A state judge is recommending that state regulators turn down Iberdrola SA’s proposed $4.5 billion buyout of Energy East Corp., saying terms of the deal aren’t in the public interest.
Administrative Law Judge Rafael A. Epstein said in his recommendation, posted today on the state’s Public Service Commission Web site, that if state regulators decide to go ahead and approve the purchase, New York utility customers, which include nearly 90,000 natural gas and electric customers of New York State Electric & Gas Corp. in Putnam, Westchester and Dutchess counties, should be granted a 4.4 percent cut in rates and possible further rate reductions.
Epstein’s decision, which isn’t binding, recommends further conditions should the PSC OK the deal, including requiring Iberdrola to sell wind-turbine generators in New York state to prevent any possibility of electricity price manipulation.
Last month, Sen. Charles Schumer, D-New York, called on the commission to drop its insistence that conditions that Iberdrola sell all its wind power assets, saying that requirement wasn’t in keeping with the goal of moving the state toward renewable sources of energy.
Iberdrola is the world’s fourth largest utility company, based on revenues. It agreed to buy Portland, Maine-based Energy East a year ago.
In addition to NYSEG, which has 871,000 electricity and 256,000 natural-gas customers statewide, Energy East also owns Rochester Gas & Electric.
New York is the last of four Northeastern states to weigh in on the deal. Connecticut, New Hampshire and Maine have approved the buyout.
By David Schepp
16 June 2008
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