Public Service Enterprise Group and Exelon have announced plans to sell off four more power plants in a bid to stave off concerns over their proposed merger. The $12 billion acquisition of Newark-based PSEG by Chicago-based Exelon announced late last year would create the largest utility and the biggest generator in the US.

In a filing with the Federal Energy Regulatory Commission, the two companies have announced plans to divest 4 GW of capacity, up from 2,900 MW initially proposed, and have identified eight plants among those likely to be auctioned off, including four in New Jersey.

The move is designed to damp opposition to the emergent giant on competition grounds. This figure is in addition to 2,600 MW of “virtual” divestiture of nuclear power sold through long-term contracts. If federal hearings into the merger are convened closure of the deal is expected to be delayed through to mid-2006.