Duke Energy and Progress Energy received conditional approval for their merger from the Federal Energy Regulatory Commission (FERC) on June 8. The companies plan to close their merger, which would create the nation’s largest utility, by the targeted date of July 1.
The companies put out a joint press release on Monday saying that they "have substantially completed their evaluation of the orders’ conditions and expect to make a compliance filing with the FERC within 15 days, as requested by the FERC. They will also work to secure final merger-related approvals from the North Carolina Utilities Commission (NCUC) and Public Service Commission of South Carolina (PSCSC) as quickly as possible."
In December last year, FERC refused to unconditionally approve the $13.7 billion merger deal, citing concerns about its impact on power markets in North and South Carolina—where both companies are based—for its decision. Friday’s conditional approval signals that the companies and FERC are closer to agreement, but merger conditions remain.
"We are pleased that the FERC has conditionally approved the merger, our Joint Dispatch Agreement and Joint Open Access Transmission Tariff," said Jim Rogers, chairman, president and CEO of Duke Energy. "We will quickly complete the evaluation of the conditions in the orders while working to obtain the remaining regulatory approvals to close the merger on July 1."
"Receiving the FERC’s conditional orders last Friday is a major milestone for this transaction," said Bill Johnson, chairman, president and CEO of Progress Energy. "Both companies have accelerated the integration planning efforts necessary to complete this transaction by July 1 and begin to deliver the substantial benefits of the merger as soon as possible."
To date, the companies have received merger-related approvals from, or met the requirements of, the U.S. Department of Justice under the Hart-Scott-Rodino Act, U.S. Nuclear Regulatory Commission, Kentucky Public Service Commission, Federal Communications Commission, and the shareholders of both companies.
The NCUC is required to approve the merger and the Joint Dispatch Agreement. The PSCSC must also approve the Joint Dispatch Agreement. Both commissions are expected to determine their schedules for considering the merger-related dockets soon.
While the companies continue to target a July 1 closing date, the timing is dependent on receiving the remaining state regulatory approvals and submitting additional compliance filings with FERC. In addition, the consummation of the merger is contingent on satisfying all the conditions to the merger according to the terms of the merger agreement.
Sources: POWERnews, Duke Energy/Progress Energy
—Dr. Gail Reitenbach, POWER managing editor (@POWERmagazine)