NSTAR WANTS permission to merge with Northeast Utilities, and wants it now. When the Patrick administration asked state regulators last month to hold off on approving the deal until the two companies provide more detailed information about their post-merger plans, NStar bewailed the move, warning that a delay could torpedo the whole deal. But regulators at the Department of Public Utilities needn’t feel rushed. With significant consumer and environmental issues at stake, the department must give rigorous scrutiny to a proposal that might be in the public interest - or might not be.
NStar deal needs full review, not rubber stamp, from state
EDITORIAL | Globe Editorial
The proposed merger would create the largest utility company in the region, a $17.5 billion giant with nearly 3.5 million customers. The two companies say the new entity would have more financial resources and greater clout in the market. Maybe so. But regulators need to make sure the merger would also translate into lower prices for consumers, and that it would further the state’s clean-energy goals. Right now, there’s reason for skepticism on both counts.
NStar provides electric service in many parts of Greater Boston and on Cape Cod and the South Coast. Currently, its customers pay some of the state’s highest electricity bills - $7 to $19 more a month than customers of National Grid, which covers much of the rest of the state. NStar says more of its distribution lines are underground, justifying the higher rates, but a lack of recent scrutiny makes it hard to say if the company’s explanations are credible. NStar has not undergone a full “rate case,’’ or regulatory audit, in 25 years. In a rate case, a company’s books are opened, and it’s forced to justify its prices. It would be reasonable for regulators to require such a proceeding before allowing the merger, in order to establish a baseline that would make it possible to judge the possible consumer savings of a deal.
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