In push for merger, Exelon to move some Phila. jobs to D.C.

Exelon Corp., parent company of Peco Energy Co., plans to move some jobs from Philadelphia to Washington - including the job of the executive who chairs a regional business organization that promotes Philadelphia's commercial interests.

Exelon has agreed to shift the headquarters of Exelon Utilities from Philadelphia to Washington as part of a deal to win support for its troubled merger with the utility that serves the nation's capital.

Exelon Utilities, which oversees the company's utilities in Philadelphia, Chicago, and Baltimore, is headed by Denis P. O'Brien. O'Brien also chairs the Greater Philadelphia Chamber of Commerce, which promotes local business interests here.

The company would shift the headquarters of Exelon Utilities to Washington within six months of the merger, according to a filing in Washington.

About 56 employees are dedicated to Exelon Utilities, including about 30 in Pennsylvania, said Exelon spokesman Paul Elsberg. Exelon Utilities maintains offices inside the Peco building at 2300 Market St.

"We expect no significant change to staffing levels in Pennsylvania as a result of the merger," Elsberg said.

Exelon, whose main office is in Chicago, agreed to establish Washington as its co-corporate headquarters as part of a sweetened package to salvage its proposed $6.8 billion merger with Pepco Holding Corp.

The proposed merger, which would create the nation's largest utility company, ran aground in August, when the D.C. Public Service Commission unanimously rejected it as not in the best interests of ratepayers. Pepco Holdings owns three utilities, including Pepco, whose territory includes Washington.

In a settlement with Washington Mayor Muriel E. Bowser announced Tuesday, Exelon agreed to maintain the headquarters of Exelon Utilities in Washington for at least a decade. It also agreed to relocate its chief financial officer and chief strategy officer from Chicago to Washington.

Bowser said Exelon increased its proposed investment in Washington to $78 million from $14 million. Along with more support for low-income customers and for sustaintable-energy initiatives, Exelon agreed to move 100 corporate jobs to Washington by 2018.

The agreement requires the approval of the D.C. regulatory commission. The merger already has been approved by federal regulators and utility commissions in New Jersey, where Pepco operates Atlantic City Electric Co., and in Delaware and Maryland, where Pepco owns Delmarva Power.

The enhanced deal with Washington officials demonstrates the complications that utility companies face in getting mergers approved by local regulators. In 2006, Exelon scrapped a $17 billion merger with New Jersey's Public Service Enterprise Group after regulators raised concerns.

In 2000, Exelon was created by the merger of Peco and Unicom Corp., parent of Commonwealth Edison, the Chicago utility. As part of that deal, Exelon agreed to maintain a significant presence in Southeastern Pennsylvania. Exelon Generation, which oversees the company's network of power plants, is in Kennett Square.

Exelon Utilities, which oversees power-distribution efforts, was created after Exelon enlarged its utility holdings through a 2012 merger with Constellation Energy of Baltimore, which owned Baltimore Gas & Electric. O'Brien, then Peco chief executive, was elevated to coordinate all Exelon's utilities.

With the Pepco merger, O'Brien would oversee about 16,000 utility employees in five states and the District of Columbia, including about 2,500 in Southeastern Pennsylvania. Exelon would become the nation's largest electric utility with 8.6 million customers.

"The location of Exelon Utilities' headquarters will help us continue to develop and replicate best practices, enhance collaboration, and achieve superior performance across all of our utilities as the Pepco Holdings utilities are integrated into the Exelon family of companies," Elsberg said.

Regarding O'Brien's position with the Greater Philadelphia Chamber of Commerce, Elsberg said O'Brien's "long-standing history of commitment and support to the Philadelphia region" would continue, even though his primary office would be in Washington.

amaykuth@phillynews.com

215-854-2947 @maykuth