In a move that would create the largest utility in the United States, Charlotte, N.C.-based Duke Energy and Raleigh, N.C.-based Progress Energy announced on Jan.10 that they plan to complete a $13.1-billion all-stock merger before the end of the year.
The combined company, to operate as Duke Energy, would have more than seven million electric customers and 57.2 GW of company-owned electric generation. Duke Energy operates in the Carolinas, Indiana, Kentucky and Ohio, and Progress Energy operates in the Carolinas and Florida.
In a conference call on Jan.10, company executives said the move would improve both companies’ ability to fund and build new nuclear plants because of efficiencies and a larger rate base over which to spread the cost of new plants.
“It positions us well for new nuclear,” said Bill Johnson, president and CEO of Progress Energy, who will remain as president and CEO of the combined company. Jim Rogers, current head of Duke, will be the company’s executive chairman. Progress had postponed applications to build two new Westinghouse AP1000 pressurized-water reactors, each in North Carolina and Florida, while Duke is still moving ahead with plans for two new AP1000 units in South Carolina.
Johnson said that with a $9-billion fleet modernization program— including shutting down old coal plants, converting some to burn natural gas and installing emission controls—both companies are reducing greenhouse-gas emissions and are “well positioned” to meet the new Environmental Protection Agency regulations.
Johnson said the new regulations could require significant additional plant closures. Rogers said Progress Energy and Duke Energy would be interested in discussing the possibility of an ownership stake in two AP1000 that are currently under development at the V.C. Summer nuclear station by South Carolina Electric & Gas.
Duke Energy and Progress Energy separately were already developing 4,863 MW of new fossil-fired capacity. Duke is building an 825-MW pulverized coal unit and two 620-MW gas-fired combined-cycle units in North Carolina, as well as a 618-MW integrated gasification combined-cycle unit in Indiana. In North Carolina, Progress is building three gas-fired combined-cycle units for a total of 2,180 MW.