Pennsylvania Power & Light Co. said Tuesday (5/7) that federal merger review policy should be designed to "preserve and enhance competition in price, output and customer choice, while reducing the need for costly continuing regulatory oversight."

PP&L made its remarks in comments filed with the Federal Energy Regulatory Commission, which is conducting an inquiry into the process it uses in reviewing proposed utility mergers.

"We believe that FERC will play an important role in ensuring that mergers in the electric utility business do not adversely affect the move toward a more competitive marketplace," said Robert J. Grey, PP&L's senior vice president and general counsel.

In its filing, the company said that "at this critical juncture in the electric power industry the commission's role in protecting competition is as important as it has ever been." Since the commission's actions now will shape the industry for decades to come, PP&L said "the development and careful implementation of its merger policy must be of the highest priority."

The Allentown-based utility made the following points as part of its comments:

• The commission should consider the impact of potential mergers on retail competition.
• FERC should bring its merger policy in line with the guidelines used by the Department of Justice and the Federal Trade Commission.
• The commission should condition its approval of anti-competitive mergers on the selling off of sufficient assets to restore competition to pre-merger levels.
• FERC should assure that a merger does not result in an ability of the combined entity to maintain prices above competitive levels.
• FERC should examine whether a proposed combination erects barriers that prevent new suppliers from entering the market.
• In evaluating the efficiencies claimed as the result of a merger, the commission should consider only those efficiencies that cannot be reasonably achieved by means other than a merger.

Pennsylvania Power & Light, which provides electric service to 1.2 million customers in Central Eastern Pennsylvania, is a subsidiary of PP&L Resources, Inc.