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Constellation signs agreement with US Department of Justice to acquire Calpine

Constellation signs agreement with US Department of Justice to acquire Calpine
Constellation signs agreement with US Department of Justice to acquire Calpine

Constellation Energy, a U.S.-based power company, announced on Friday that it had reached an agreement with the U.S. Department of Justice regarding the conditions necessary to complete the previously disclosed $16.4 billion purchase of Calpine Corporation.

Calpine must also divest four of its generating assets located in the Mid-Atlantic Region. The Federal Energy Regulatory Commission has approved the deal.

The deal announced in January is one of the largest acquisitions in the U.S. Power Industry. It comes at a period of increasing electricity demand driven by the proliferation and energy-hungry AI Data Centers and the electrification and transportation of buildings and vehicles.

Constellation received regulatory approval in July from FERC, following approvals earlier by the Public Utility Commission of Texas and the New York Public Service Commission for the acquisition.

Constellation has agreed to divest its three natural gas-fired plants, including the York 2 plant near Philadelphia, the Jack Fusco Energy Center in Houston, Texas and a minority interest in the Gregory Power Plant in Corpus Christi.

In a statement, the DOJ stated that the divestitures were made to address concerns about the acquisition harming competition and increasing prices for consumers on the Electric Reliability of Texas grid and PJM interconnection grid. (Reporting and editing by Krishna Chandra Eluri in Bengaluru. Pranav Mathur is based in Bengaluru.

(source: Reuters)