Progress CEO: Merger with Duke will boost NC
Posted January 3, 2012 4:01 a.m. EST
Updated January 3, 2012 6:32 p.m. EST
Durham, N.C. — North Carolina has the potential to become an “energy hub” for the nation, but approval of the delayed merger between Progress Energy and Duke Energy is essential for that to happen, Progress Chairman and Chief Executive Bill Johnson said Tuesday.
Speaking at a forum about energy ahead of the North Carolina Chamber's and North Carolina Bankers Association's 10th annual Economic Forecast Forum, Johnson reiterated the commitment of both companies to the multi-billion dollar deal that would form one of the nation’s largest utilities.
Announced nearly a year ago, the deal was expected to close before the end of 2011. Federal regulators delayed approval last month, forcing Progress and Duke to revise plans.
Johnson said he remains hopeful a deal will be closed in the next three months or so, describing the delay as a “setback.”
The deal would put Johnson in charge of the combined company, and the corporate headquarters would be located in Charlotte. Hundreds of jobs in Raleigh will be phased out.
Johnson defended the merger, saying a combined company would have the capital and resources necessary to upgrade facilities, embrace new technologies and, at the same time, produce “more than $650 million in savings over the first five years.”
Concern about electricity prices has been a factor cited by opponents of the merger.
A combined company also would help Duke Energy “attract jobs to the state” that would be linked to “our nation’s energy transformation.”
Johnson did express concerns about environmental regulations that he said drive up energy costs. While he acknowledged global warming and a need to lower carbon emissions in his remarks, Johnson called for a prioritization of concerns.
“When you get to the end of the string, customers have to pay the bill,” he said.
Looming regulations will be among the costliest on record even in the view of the U.S. Environmental Protection Agency, he said.
The impact of energy costs on customers “is something I think about every day,” he added.
Johnson pointed out that one-third of the utility’s customers have a household income of less than $30,000 a year.
Tom Skains, chairman, president and chief executive of Piedmont Natural Gas, discussed the role of natural gas in the country's future during the preliminary session of the economic forum.
Other speakers scheduled for the event include Gov. Beverly Perdue and Kevin Kabat, president and chief executive of Fifth Third Bancorp.