The U.S. Justice Department is urging regulators to take a closer look at Vistra Corp.’s planned $6.8 billion acquisition of a rival power producer because it may be anticompetitive.
The warning applies to Vistra’s proposed takeover of Energy Harbor Corp. announced in March, a deal that would more than double its nuclear capacity, increase its natural gas operations and expand its retail customer base. The transaction is expected to close by year-end.
“The combination of Vistra’s and Energy Harbor’s nuclear and fossil-fuel plants in Ohio and Pennsylvania may substantially lessen competition and increase wholesale electricity prices,” the Justice Department told the Federal Energy Regulatory Commission on Tuesday, Aug. 22, in a filing.
To increase the wholesale price Vistra receives on the low-cost nuclear reactors acquired from Energy Harbor, it’s possible the utility owner could withhold output from its higher-cost gas plants, the Justice Department said in the filing.
“By combining these generating units, the transaction may therefore increase Vistra’s incentive or ability to raise electricity prices profitably,” it said.
Source: Crain’s Cleveland Business