RTO Insider reports that FERC has issued a proposed policy statement regarding "hold harmless" commitments made during utility mergers.
The policy is intended to further define merger costs and how they are accounted for, as well as proposed accounting mechanisms to track them.
As if it's about some accounting "confusion," and not about utilities willfully violating the commitments they make as a condition of approval for their merger. But, hey, FERC has to start somewhere, I suppose. Maybe some proactive monitoring of utility financial filings could begin to put a damper on the merger cost recovery free-for-all. But then will the utilities just find more creative ways to improperly recover their merger costs? How about some penalties for utilities found to have improperly recovered merger costs? I think maybe a $30M fine for each occurrence would be appropriate.
The policy is intended to further define merger costs and how they are accounted for, as well as proposed accounting mechanisms to track them.
As if it's about some accounting "confusion," and not about utilities willfully violating the commitments they make as a condition of approval for their merger. But, hey, FERC has to start somewhere, I suppose. Maybe some proactive monitoring of utility financial filings could begin to put a damper on the merger cost recovery free-for-all. But then will the utilities just find more creative ways to improperly recover their merger costs? How about some penalties for utilities found to have improperly recovered merger costs? I think maybe a $30M fine for each occurrence would be appropriate.
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