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DOJ Pushes Divestments to Protect Competition in Major Power Merger

By  |  December 8, 2025

The U.S. Department of Justice has moved to ensure continued competition in regional electricity markets by mandating the sale of six power facilities as a condition for Constellation Energy Corporation, Inc.’s planned $26.6 billion purchase of Calpine Corporation, according to a statement from federal officials.

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    The department’s Antitrust Division, joined by the Texas Attorney General, filed a civil lawsuit in the U.S. District Court for the District of Columbia aimed at blocking the transaction. However, per a statement, a proposed settlement submitted at the same time would resolve government concerns if it receives court approval.

    “The price of electricity is a pocketbook issue to American consumers working hard to afford their monthly utility bills. When it comes to their electricity bills, Americans deserve the benefit of robust competition among electricity generators,” said Assistant Attorney General Abigail Slater of the Justice Department’s Antitrust Division. “This settlement includes a six-plant divestiture to an acquisition that risked harming tens of millions of electricity consumers in the mid-Atlantic and Texas. I am appreciative of the partnership with our co-plaintiff, the State of Texas, to secure relief for consumers.”

    Federal officials said the acquisition would establish the largest wholesale electricity producer in the country and could allow the merged company to strategically withhold power supply from certain generators to raise prices, according to a statement. The department’s complaint warned of possible negative effects on customers in Texas and in communities served by the PJM Interconnection grid across states such as New Jersey, Delaware, southeastern Pennsylvania, Maryland, and Virginia.

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    To prevent those outcomes, the companies would be required to sell off four plants tied to the PJM system and two in Texas that feed into the Electric Reliability Council of Texas (ERCOT) grid. The list includes the Bethlehem Energy Center and York Energy Center in Pennsylvania, two facilities in Wilmington, Delaware, and natural gas plants near Houston and Corpus Christi, Texas.

    This settlement marks the first consent decree filed by the Antitrust Division for a power-sector merger in more than a decade.

    Constellation, headquartered in Baltimore, Maryland, is among the nation’s largest owners of power generation, with revenue of $23.6 billion reported in 2024. The company currently controls over 20,000 megawatts of capacity in the PJM market and about 5,000 megawatts in ERCOT. Calpine, based in Houston, operates leading natural gas and geothermal generation assets, managing roughly 9,000 megawatts in ERCOT and 5,000 megawatts in PJM.

    As outlined under the Tunney Act, the proposed judgment and a related competitive impact statement will be published in the Federal Register.

    Source: Justice Gov