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Vistra’s (NYSE:VST) proposed acquisition of Energy Harbor assets could “substantially” reduce competition and raise wholesale electricity prices in the PJM Interconnection, the U.S. Department of Justice said Tuesday, according to UtilityDive.com.
The Federal Energy Regulatory Commission’s review of the proposed deal should focus on whether the purchase could give Vistra (VST) an incentive to withhold generating units from PJM’s markets to drive up power prices, the DoJ’s antitrust division said in a filing to FERC.
“To increase the wholesale price it receives on the low-cost nuclear plants it acquires from Energy Harbor, it is possible that Vistra could withhold output from its higher-cost natural gas generating units,” which could “increase Vistra’s incentive or ability to raise electricity prices profitably,” the DoJ said.
While FERC generally analyzes proposed mergers on market shares and supplier concentration, it should conduct a “supply curve analysis” within PJM regions, DoJ said.
Under the deal announced in March, Vistra (VST) agreed to buy three nuclear power plants in Ohio and Pennsylvania totaling more than 4K MW and add ~5M Energy Harbor retail customers to its portfolio.
