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Bankruptcies possible in Ill. deregulation dispute

September 28, 2005

NEW YORK (Reuters) – Exelon Corp. and Ameren Corp. said
that if Illinois’ governor gets his way in a dispute over
deregulation of the state’s power markets, it could be
disastrous to the companies’ regulated utility units in
Illinois, possibly leading to bankruptcy.

Speaking at a Merrill Lynch conference in New York, top
executives from both companies acknowledged that bankruptcy was
a possibility for Exelon’s Commonwealth Edison unit and
Ameren’s regulated utilities in Illinois if the deregulation
process is derailed in the state.

“You would see ComEd’s financial position deteriorating and
deteriorating steadily over the next couple of years,” if the
governor’s position becomes the state policy, Exelon CEO John
Rowe said.

Rowe said that Exelon had met with credit agencies and
believes it is likely that they will establish some sort of
credit watch on the unit.

Earlier this month, Illinois Gov. Rod Blagojevich sent
letters to the Illinois Commerce Commission (ICC) arguing that
proposals by Exelon and Ameren to procure power for their
utility units through reverse auctions would result in
unjustified rate increases for customers.

“I consider an approval of a reverse auction procurement
process of market-based rates for wholesale power either a
serious neglect of duty or gross incompetence by the ICC,”
Blagojevich said in one of the letters.

Earlier Wednesday, Exelon said it expects 2005 earnings
toward the upper end of its previously estimated range because
of strong results from the first half of the year, as well as
in July and August.

The company previously had estimated 2005 adjusted
operating earnings of $3 to $3.15 per share. Wall Street
analysts, on average, are expecting $3.13 per share, according
to Reuters Estimates.




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