FERC conditionally authorizes Duke Energy-Progress Energy merger
In an order issued September 30, the FERC said the companies have up to 60 days to propose measures to address the market power concerns
Charlotte and Raleigh, N.C., October 3, 2011 — The Federal Energy Regulatory Commission has conditionally authorized the proposed merger of Duke Energy and Progress Energy, subject to the agency's approval of mitigation measures to address its finding that the combined company could have an adverse effect on competition in Carolinas power markets.
In an order issued September 30, the FERC said the companies have up to 60 days to propose measures to address the market power concerns.
"We believe our proposed merger will provide significant customer benefits and protections, and we are confident that we will meet the FERC's standards for approval. We are still working toward closing the merger by year's end," according to the statement. "We plan to file detailed mitigation measures within about two weeks to address the FERC's concerns about market power in the Carolinas."
The FERC's order did not identify any concerns about market power in the combined company's other service areas (Florida, Indiana, Ohio and Kentucky), or other issues that need to be addressed by the companies.
The following is an update of the merger's other regulatory approvals:
* The N.C. Utilities Commission completed public hearings on the merger Sept. 22 and has not yet issued an order.
* Merger-related filings with the Public Service Commission of South Carolina, which has scheduled hearings for Oct. 26.
* An application to approve the merger with the Kentucky Public Service Commission, which has provided conditional approval.
* Joint filings with the Nuclear Regulatory Commission (related to nuclear plant license transfers).
* Hart-Scott-Rodino filing with the U.S. Department of Justice and Federal Trade Commission. The waiting period under the HSR Act expired April 27, 2011.
* Assignment of Authorization filings with the Federal Communications Commission, approved July 27.
Although there are no merger-specific regulatory approvals required in Indiana, Ohio or Florida, the companies will continue to update the regulatory commissions in those states on the merger. The merger also requires modifications to several existing affiliate agreements; the companies will file those with various state commissions for approval, as applicable.
If completed, the merger will create the nation's largest electric utility, as measured by enterprise value, market capitalization, generation assets, customers and numerous other criteria. The combined company is expected to have more than 7.1 million electric customers in six states (North Carolina, South Carolina, Florida, Indiana, Ohio and Kentucky) and the largest regulated nuclear fleet in the country.
Both Progress Energy, Inc. and Duke Energy Corporation received shareholder approval at separate meetings August 23.