Federal regulators say TransCanada's proposed acquisition of a United States gas pipeline doesn't raise national security concerns.
The Committee on Foreign Investment in the United States provides oversight when international companies want to acquire major U.S. infrastructure.
TransCanada is selling its hydro system on the Connecticut and Deerfield rivers to help fund the company's $13 billion deal with the Columbia Pipeline Group.
Columbia, based in Houston, Texas, owns one of the largest interstate natural gas pipeline networks in the U.S., "extending from New York to the Gulf of Mexico," according to a TransCanada release.
The decision this week by the federal regulatory committee puts TransCanada one step closer toward its acquisition of the 15,000-mile Columbia natural gas pipeline. Meanwhile, Vermont is considering making its own bid for TransCanada's 560-megawatt hydro system.
The Vermont Hydro Power Working Group was established to look into state ownership of the hydro system and the group is meeting this summer to decide if the state should try to purchase the asset.
TransCanada says it wants to unload the hydro system this year to ensure it can complete the pipeline acquisition before the end of 2016.
The company must also get clearance from the United States Federal Trade Commission for the pipeline deal.