Louisville, Kentucky (Platts)--2Aug2011/528 pm EDT/2128 GMT
Kentucky regulators Tuesday endorsed Duke Energy's proposed acquisition of Progress Energy, marking the first state regulatory approval in the $14.7 billion deal unveiled earlier this year. Although both companies are headquartered in North Carolina, the transaction required Kentucky Public Service Commission approval because Duke has a subsidiary, Duke Energy Kentucky, under the PSC's jurisdiction. The small utility, formerly known as Union Light, Heat & Power, serves about 135,000 electric customers in northern Kentucky. Article continues below... Request a free trial of: Electric Power Daily Electric Power Daily delivers a complete account of North American power industry news. It features federal and state policy, regulation, crucial environmental issues, generation and transmission projects, mergers and acquisitions, and much more.
Kentucky regulators Tuesday endorsed Duke Energy's proposed acquisition of Progress Energy, marking the first state regulatory approval in the $14.7 billion deal unveiled earlier this year. Although both companies are headquartered in North Carolina, the transaction required Kentucky Public Service Commission approval because Duke has a subsidiary, Duke Energy Kentucky, under the PSC's jurisdiction. The small utility, formerly known as Union Light, Heat & Power, serves about 135,000 electric customers in northern Kentucky.
Article continues below...
Electric Power Daily delivers a complete account of North American power industry news. It features federal and state policy, regulation, crucial environmental issues, generation and transmission projects, mergers and acquisitions, and much more.
In its order, the PSC approved a recent settlement between the merging companies and Attorney General Jack Conway that calls for a two-year moratorium on filings for general rate increases and commitments to assist low-income customers and to promote economic development. The commission attached three conditions to the merger: Duke Energy Kentucky must continue to offer a full range of cost-effective energy conservation and efficiency programs; the board of directors of the combined company must include at least one non-employee member who resides in the company's service territory in Kentucky, Indiana or Ohio; and no merger-related costs may be passed on to Duke Energy Kentucky customers. Duke and Progress have one week to accept the conditions. Tom Williams, spokesman for Charlotte-based Duke, said the merger still needs North Carolina, South Carolina, Federal Energy Regulatory Commission and Federal Trade Commission approvals. Williams said the company is reviewing the conditions added by the Kentucky PSC and would have no immediate comment. Duke hopes to complete the merger by the end of this year. --Bob Matyi, newsdesk@platts.com