§824b Disposition of property; consolidations; purchase of securities

Summary

Public utilities must get permission from the Federal Energy Regulatory Commission before doing big transactions worth more than $10,000,000. That includes selling, leasing, or otherwise getting rid of utility facilities; merging or combining facilities with another utility; buying securities of another utility; or buying an existing generation plant used for interstate wholesale sales that the Commission sets rates for. Holding companies that include transmitting or electric utilities also need Commission approval before buying securities or merging with such companies when the value is over $10,000,000. When a utility asks for approval, the Commission must tell the Governor and the State commission where the property is and may tell others. The Commission will approve only after notice and a hearing if the deal fits the public interest and does not let the utility’s money or assets be used to help a related non-utility company, or be pledged for a related company, unless that use is also in the public interest. The Commission must make rules for fast review and identify kinds of deals that usually meet the test. For other applications, the Commission must decide within 180 days, or the application is treated as approved unless the Commission shows good cause and pauses the clock for up to another 180 days. By September 28, 2018, the Commission had to create a rule that any utility merging facilities worth more than $1,000,000 — but not needing prior approval — must tell the Commission within 30 days after the deal closes, and the rule must try to limit paperwork. The Commission may approve with conditions needed to keep service reliable and can change its orders later for good cause. Associate company, holding company, and holding company system are defined in the Public Utility Holding Company Act of 2005 (they refer to related companies, a company that owns others, and the group of companies it controls).