Arizona Corporation Commission building in downtown Phoenix.
The Arizona Corporation Commission (ACC) and the Utah Attorney General, Sean D. Reyes, are co-leading a coalition of 19 states in filing a motion for intervention and protest with the Federal Energy Regulatory Commission (FERC).
The coalition aims to block one of the world’s largest investment management companies from acquiring significant shares in public utilities.
BlackRock Inc., has requested a three-year reauthorization of “blanket authorizations” allowing it to purchase, acquire or take over $10 million in voting securities of any public utility, electric utility, transmitting utility or holding company with electric or transmitting assets.
The coalition contends that FERC should deny BlackRock, its affiliates and subsidiaries its request unless specific conditions are met.
These include limiting collective ownership to 20% or less of shares of each Federal Power Act (FPA)-covered utility, requiring BlackRock to operate as a passive investor and ensuring the company holds shares only under its fiduciary duties to investors.
The group also seeks a mandate for BlackRock to report to the federal government anytime it votes against utility managers’ recommendations on shareholder proposals or board nominations.
According to the ACC, FERC has repeatedly granted the BlackRock blanket authorizations and reauthorizations over the past decade.
"What we have here are large companies that effectively are expecting to have a rubber stamp by FERC to invest beyond the protections that have been put into place for a very good reason," said Commissioner Nick Myers.
Myers argued that blanket extension that BlackRock is seeking, would allow the company to continue its operations without review.
"The fact that this has been an open docket for over a year and it's just now being pushed seemingly prior to the administration change is all the more telling."
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