NSTAR (NYSE: NST) and Northeast Utilities (NYSE: NU) have reached separate, comprehensive merger-related agreements with both the Massachusetts Department of Energy Resources (DOER) and the Massachusetts Attorney General (AG) that will guarantee substantial customer and environmental benefits, while allowing the utilities’ merger to proceed. The settlement agreements both call for a one-time $21 million rate credit to be directed to customers of NSTAR Electric, NSTAR Gas and Western Massachusetts Electric Company (WMECo). Base distribution rates for the utilities would then be frozen until 2016. In addition, under the agreement with the DOER, the utilities pledge further environmental commitments to solar, wind, hydro, energy efficiency and electric vehicle development, including a memorandum of understanding to purchase clean power from Cape Wind, the nation’s first off-shore, large-scale wind farm.
“Today’s announcement is the result of a year-long effort by the state agencies and the companies to reach agreements that appropriately balance all of the interests affected by the merger,” said Tom May, NSTAR Chairman, President and CEO. “Benefits for Massachusetts customers are both immediate, in the form of a rate credit plus a four-year distribution rate freeze, and longer-term, with NSTAR’s purchase of clean power from Cape Wind, which together with our existing wind contracts will help meet the state’s clean energy targets. We recognize that the climate change goals set forth by Governor Patrick’s Green Communities Act will require aggressive action and we think the best way to meet those requirements is through a diversified portfolio of renewable resources."
"The merger will benefit all of our customers by creating a stronger company that stays headquartered in New England and is expected to provide higher service levels and lower costs over the long term," noted Charles W. Shivery, NU Chairman, President and CEO. "This merger continues to be the right decision for customers, employees and shareholders now and into the future."