Private Equity Buyouts of Public Utilities: Preparation for Regulators

This paper prepares regulators to address mergers, with a focus on private equity buyouts. It analyzes the rationales for mergers, the differences between a private and a public buyout of a utility company from both a financial and regulatory perspective, as well as the public policy implications of that difference. The paper then outlines regulatory action that will help to ensure that the target utility continues to attract capital and execute its public service obligations at the lowest reasonable cost to ratepayers.