Utility Mergers and the Modern (and Future) Power Grid

12 Pages Posted: 23 May 2021 Last revised: 26 Aug 2021

See all articles by Joshua Macey

Joshua Macey

University of Chicago Law School

Date Written: May 18, 2021


Scott Hempling’s Regulating Mergers and Acquisitions of U.S. Electric Utilities provides a comprehensive history of electric utility mergers in the United States since the 1980s. Hempling documents the dramatic consolidation the industry has seen in the past fifty years, and he convincingly argues that electric utility mergers present unique problems for regulators. This Review considers how utility acquisitions (a) allow holding companies to leverage the utilities’ creditworthiness to cross-subsidize non-utility affiliates, and (b) exacerbate informational asymmetries between regulators and utilities. It argues that utility mergers generate negative spillovers outside of the utility’s service territory that have potentially significant environmental consequences, and argues that FERC and state energy regulators have been overly reluctant to respond to these challenges, even compared to regulators that oversee other heavily regulated industries.

Suggested Citation

Macey, Joshua, Utility Mergers and the Modern (and Future) Power Grid (May 18, 2021). Energy Law Journal, Vol. 42, 2021, University of Chicago Coase-Sandor Institute for Law & Economics Research Paper No. 929, Available at SSRN: https://ssrn.com/abstract=3849021

Joshua Macey (Contact Author)

University of Chicago Law School ( email )

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Chicago, IL 60637
United States

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