Today's announcement that Bangor Hydro Electric's parent company has agreed to purchase the parent company of Maine Public Service has company officials assuring that there will be no changes to service, rates or employment. But at least one energy expert questions those statements.

The proposed acquisition involves bringing Maine's third-largest electric utility into the family of Maine's second-largest electric utility.

Brent Boyles is CEO of Maine Public Service Company and the larger Maine and Maritimes Corporation. The corporation has agreed to be sold to a holdings company owned by Emera, the parent of Bangor Hydro Electric Company. Emera is based in Halifax, Nova Scotia.

"Our customers, it should be transparent to them, it should be transparent to the employees and the economic development that this might spur -- that's really the nugget here," says Brent Boyles, CEO of Maine Public Service Company and the larger Maine & Maritimes Corporation.

The corporation has agreed to be sold to a holdings company owned by Emera, the parent of Bangor Hydro Electric Company. Emera is based in Halifax, Nova Scotia.

"We want to have the ability to develop transmission for economic development reasons in northern Maine, and the board of directors at Maine & Maritimes felt that a larger company with a stronger financial position and more financial wherewithall might be more successful in that development," Boyles says.

Under the terms of the agreement, all outstanding shares of Maine and Maritimes common stock will be purchased for $45 dollars a share in cash. The transaction is subject to approval by shareholders, the Maine Public Utilities Commission and the Federal Energy Regulatory Commission.

"We expect that the deal will take about 6 to 8 months to complete," says Susan Faloon, spokeswoman for Bangor Hydro Electric Company.

"We don't anticipate any changes at this point in how Maine Public Service operates, and we don't expect anything to change as far as how Bangor Hydro Elecric Company operates," Falloon says. "You know, we still are regulated through the Maine Public Utilities Commission, so we're not anticipating any changes in how the rates are set. I know that has maybe been a concern for some folks who are served by Maine Public Service, because their rates have been historically low. We don't expect that to change."
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Putting money aside, there are some major differences between Bangor Hydro Electric Company and Maine Public Service. For one, MPS is about a third the size of Bangor Hydro with about 36,000 customers. MPS is connected to the New Brunswick System, while Bangor Hydro is connected to the ISO-New England power grid.

And while neither company actually generates electricity, there is the issue of MPS's lower transmission and delivery prices.

"Their current cost of transmission is about $18 per kilowatt year; the projected cost in New England will be $116 per kilowatt year," says Gordon Weil, a former state energy director and public advocate.

"It would appear that if the acquisition is approved by regulators, that inevitably northern Maine will become part of the New England system and end it's participation in the Maritimes system," Weil says. "And the real concern for consumers there is that their costs will skyrocket by comparison with what they're paying today."

The notion of bringing MPS onto the ISO-New England grid may come as a surprise since the state has suggested in the past that Maine consider leaving the New England grid in favor of partnering with Canada. But Faloon says that neither move is expected to take place.

"We don't anticipate any changes for Bangor Hydro as far as being a member of ISO-New England, and also we don't anticipate any changes with Maine Public Service," Faloon says. "And as part of this deal they will not be required to be part of ISO-New England."

Faloon says there are no plans to raise rates for MPS customers or to lay off staff at either company. Both MPS and Bangor Hydro will continue to operate separately and continue serving customers in their respective territories. Emera says it will honor the current collective bargaining agreements in place with the International Brotherhood of Electrical Workers.

But Weil says the public, lawmakers and regulators should pay close attention to whether customers will benefit from the acquisition.

"Give primary attention to the impact of this on customers," Weil says. "There's an awful lot of attention paid to job creation. In Maine everything is related to job creation these days and that's an end in itself. If job creation is financed by electric customers, it's not a good idea."

Republican U.S. Senator Olympia Snowe has released a statement echoing those thoughts, and pointing out that the proposed acquisition should have some effect on building Maine's clean energy future and making electricity prices more competitive.

State offices were closed today and the current public advocate could not be reached for comment by airtime.