AAI Urges FERC to Monitor Small M&A Transactions for Competitive Effects on Wholesale Power Markets, After Passage of Law Exempting Them From Commission Review
AAI filed comments in Federal Energy Regulatory Commission rulemaking RM19-4-000: Implementation of Amended Section 203(a)(1)(B) of the Federal Power Act. AAI’s comments urge the Commission to expand on its proposed notification requirements for transactions that fall between $1-10 million in value that are now exempt from regulatory review. The comments identify a number of compelling reasons for why expanded notification requirements for small transactions will facilitate the Commission’s collection of data and information that is necessary for the agency to monitor and evaluate changes in wholesale power markets. These reasons include how:
- A succession of small horizontal or vertical transactions can result in the accretion of market power.
- Acquisitions of small partial ownership shares in strategic assets can raise competitive concerns related to cross- or common ownership.
- The unique nature of electricity markets can make even small transactions strategically advantageous.
AAI also suggests in the comments that a number of long-pending Commission rulemakings that address various key aspects of competition in wholesale power markets be given particularly careful and timely attention.