The chief executives of Duke Energy and Progress Energy said this afternoon their companies plan to seek rate increases soon to meet a deadline to recover severance payments that will be paid to employees who lose their jobs as a result of the utilities' merger.
The public hearings on the proposed merger between Progress Energy and Duke Energy got underway this morning with dozens of residents waiting their turn to speak in a standing-room only hearing room.
The proposed merger between Duke Energy and Progress Energy just got more interesting.
State regulators who will begin public hearings on the merger tomorrow morning said today they will consider arguments about the broader economic impacts of the merger, including possible remedies for the hundreds of job losses the merger will cause.
The state's two biggest electric companies had argued such issues were out of bounds in a merger proceeding and should not be allowed. The utilities are planning to combine into the nation's biggest electric utility, with 7.1 million customers in six states.
Critics countered that it's essential to consider the consequences of the 2,000 job cuts the companies plan as part of their consolidation. North Carolina's jobless rate is above the national average and the economy is still sputtering more than a year after the recession ended.
"The commission is taking a broad perspective in assessing the costs and benefits of the proposed merger," said Progress spokesman Mike Hughes. "That is certainly the commission’s prerogative."
Opponents are already jockeying for legal advantage in next week's public hearings on the proposed merger between Duke Energy and Progress Energy.
The two power companies today asked the N.C. Utilities Commission to quash some objections raised by critics of the merger as irrelevant. If the companies prevail, the environmental groups would be barred from arguing some of their points.
The hearings are set to begin Tuesday, with Progress CEO Bill Johnson and Duke CEO Jim Rogers expected to testify on the first day. The hearings could last four days to give time to hear witnesses and listen to experts and go through cross-examinations.
More pre-trial filings are due later this week to the utilities commission as the two utilities seek to convince the utilities commission to rule critics' objections out of bounds.
The International Brotherhood of Electrical Workers is the latest to chime in as a critic of the planned merger between Duke Energy and Progress energy. The labor union wants assurances that the companies keep their promise not to lay off any linemen, technicians or field workers as part of their consolidation.
The IBEW was one of a number of groups that filed comments late Thursday to meet the deadline of the N.C. Utilities Commission. The commission is set to hold public hearings in Raleigh in two weeks on the corporate merger that would create the nation's largest electric utility.
Raleigh-based Progress said it plans to eliminate 700 to 1,000 positions in Raleigh, erasing up to half its downtown workforce as the corporate headquarters is consolidated in Charlotte. Progress and Charlotte-based Duke have said they don't expect the job cuts to affect workers in the field and in power plants.
"The companies' nebulous promise to avoid involuntary layoffs 'to the maximum extent possible' is insufficient," the IBEW wrote in its filing.
North Carolina critics of the proposed merger between Duke Energy and Progress Energy are making last-minute filings with the N.C. Utilities Commission to express their displeasure at the planned creation of the nation's largest electric utility. The deadline to file objections was today.
The groups warn that the planned merger would be a bad deal for customers and for the environment. The groups are asking the utilities commission not to approve the merger without imposing additional conditions to promote green energy.
A coalition of groups including the Sierra Club and Environmental Defense Fund say the merger would create a giant power company that will dominate the state and crowd out competition from clean energy producers.
The N.C. Sustainable Energy Association, a Raleigh trade group that represents solar and other renewable developers, wants the commission to require the power companies to pay $75 million into a public benefit fund to pay for home weatherization and other programs. The utilities have committed to contributing $15 million, one-fifth that amount.
Duke Energy and Progress Energy cleared another hurdle in their $26 billion corporate merger this morning with the announcement that the two companies reached a settlement with South Carolina's consumer advocate.
The agreement with the S.C. Office of Regulatory Staff, which is very similar to terms signed in North Carolina last week with the Office of the Public Staff, means that the consumer advocate agencies in both states will not oppose the merger when it comes up for review before the utilities commissions in each state.
The consumer advocates say the settlements will help keep down future rate increases, which are inevitable as both companies enter a phase of mutli-billion dollar power plant construction and transmission upgrades.
Progress Energy and Duke Energy have reached a deal that secures key backing in this state for the companies' planned corporate merger.
The agreement disclosed this afternoon with the state's consumer advocate will require Progress and Duke to pass on millions of dollars in savings to the public in exchange for support from the consumer agency, known as the Public Staff.
A blessing from the Public Staff removes a significant obstacle to getting the merger approved by the N.C. Utilities Commission. The Public Staff has been reviewing the merger for months at a cost of $330,000 to an outside utility analyst.
However, the deal conspicuously omits terms that have been imposed on utility mergers in other states in past years -- such as rate cuts, rate freezes and guarantees to retain employees. Regulators in Kentucky, for example, are requiring a 2-year rate freeze as a condition of approval for the Duke-Progress merger.
Progress Energy could eliminate as much as half its downtown Raleigh workforce as part of the company's merger with Duke Energy.
The Raleigh-based electric utility today updated workers to expect its downtown staff to end up between 1,000 and 1,300 employees, down from about 2,000 today. The job cuts will come through voluntary buyouts, attrition, retirements and layoffs over several years, as well as from Raleigh employees relocating to Charlotte.
The corporate merger, announced in January, will create the country's biggest electric utility with 7.1 million customers in six states. The combined company will be headquartered in Charlotte.
Under the merger terms, Progress promised to keep a "substantial presence" in Raleigh. The company will keep a number of key positions here, including N.C. utility president, two senior executives over regulated utilities and customer operations and functions that could include transmission, nuclear engineering, fossil fuel engineering, human resources, communications and IT support.
Progress Energy shareholders overwhelmingly approved the power company's $26 billion merger with Duke Energy this morning in Raleigh, just an hour after Duke shareholders gave their assent in Charlotte.
Shareholder approval, which was widely expected, would create the nation's largest electric utility with 7.1 million customers in six states. Progress shareholders voted 95.9 percent in favor of the vote, while Duke shareholders also voted overwhelmingly to approve the deal.
Executives at both electric utilities have promoted the deal for months as the best way to create the financial heft required to build new nuclear plants, upgrade transmission systems and comply with stricter environmental regulations.
"It means shareholders really like the deal," Progress CEO Bill Johnson said after the vote tally was announced this morning at the Progress Energy Center for the Performing Arts in Raleigh.