Budget Amendment ID: FY2012-S3-195-R1

Redraft ENV 195

DPU Merger Authority

Mr. Downing moved that the proposed new text be amended <w:p><w:r><w:t xml:space="preserve">by inserting, after Section _, the following new Sections: -

“SECTION__. Chapter 164 of the General Laws, is hereby amended by striking out section 96, as appearing in the 2008 Official Edition, and inserting in place thereof the following section:-

Section 96. (a) For purposes of this section, the following words shall have the following meanings.

“Control,” the possession of the power, through direct or indirect ownership of a majority of the voting securities of a gas or electric company or a holding company,  to direct or cause the direction of the management and policies of a gas or electric company or a holding company or the ability to effect a change in the composition of its board of directors or otherwise, provided, control shall not be deemed to arise solely from a revocable proxy or consent given to a person in response to a public proxy or consent solicitation made pursuant to and in accordance with the applicable rules and regulations of the Securities Exchange Act of 1934 unless a participant in said solicitation has announced an intention to effect a merger or consolidation with, reorganization, or other business combination or extraordinary transaction involving the gas or electric company or the holding company.

“Foreign electric company,” an electric company with a domicile, principal place of business, headquarters, or place of incorporation the locus of which is outside of the borders of the commonwealth.

"Foreign gas company,” a gas company with a domicile, principal place of business, headquarters, or place of incorporation the locus of which is outside of the borders of the commonwealth.

“Holding company,” any corporation, association, partnership, trust or similar organization, or person which, regardless of the locus of the domicile, principal place of business, headquarters, or place of incorporation of such entity, either alone or in conjunction and pursuant to an arrangement or understanding with one or more other corporations, associations, partnerships, trusts or similar organizations, or persons, directly or indirectly, controls, or seeks to acquire control over, a gas or electric company."

(b) Companies, except steam distribution companies, subject to this chapter, or holding companies may, notwithstanding any other provisions of this chapter or of any general or special law, consolidate or merge with one another or may sell and convey their properties to another of such companies or to a wholesale generation company, and such companies, holding companies, or wholesale generation companies may purchase such properties if such purchase, sale, consolidation or merger, and the terms thereof, have been approved, at meetings called therefor, by vote of the holders of at least two-thirds of each class of stock outstanding and entitled to vote on the question of each of the contracting companies, and that the department, after notice and a public hearing, has determined that such purchase and sale or consolidation or merger, and the terms thereof, are consistent with the public interest; provided, however, that in making such a determination the department shall at a minimum consider: potential rate changes, if any; the long term strategies that will assure a reliable, cost effective energy delivery system; any anticipated interruptions in service; or other factors which may negatively impact customer service; and provided further, that the purchase or sale of properties by, or the consolidation or merger of, wholesale generation companies shall not require departmental approval except as otherwise provided herein.

(c) No gas, electric, or holding company, subject to this chapter, shall enter into any transaction or otherwise take any action which would result in a change of its control over any gas, electric, or holding company, or foreign gas or electric company unless the terms thereof, have been approved, at meetings called therefor, by vote of the holders of at least two-thirds of each class of stock outstanding and entitled to vote on the question of each of the contracting companies, and the department, after notice and a public hearing, has determined that such transaction or action, and the terms thereof, are consistent with the public interest; provided, however, that in making such a determination the department shall at a minimum consider: potential rate changes, if any; the long term strategies that will assure a reliable, cost effective energy delivery system; any anticipated interruptions in service; or other factors which may negatively impact customer service."