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The impact of Progress Energy's merger with Duke Energy

4:47 PM, Aug 13, 2012   |    comments
Duke Energy CEO Jim Rogers testifies before the Florida Public Service Commission. He says the company's merger with Progress Energy will be good for Florida customers.
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TALLAHASSEE, Fla. -- The 1.6 million customers of Progress Energy in Florida can expect lower utility bills as a result of the company's merger with Duke Energy, which creates the largest electric utility in the nation.

That's according to Duke Energy CEO Jim Rogers, who testified before the Florida Public Service Commission Monday.

Rogers told commissioners that when you bring two companies together, they share best practices, buy in bulk and become more efficient overall. He believes those efficiencies will translate into lower utility bills for customers.

"It would be my judgment that it should not increase prices to consumers. If anything, it should over the longer term reduce cost."

Rogers also said Duke Energy has not decided the fate of the broken Crystal River nuclear plant. It has been out of commission since 2009 because of a faulty repair job.

Rogers said Duke Energy is considering a variety of factors on whether to retire the unit or repair it, which could cost well over $1 billion. One crucial factor is whether the company's insurer will pay some of the repair costs so customers don't get stuck with the bill.

"We're going to do what's best for the customers. Period. It's a complex set of issues but at the end of the day, what's best for the customers is what we will do."

"We are committed to fully and thoroughly reviewing the repair option. We have a project management team working every day on furthering the engineering and analyzing all aspects of the repair. While we have not made a decision on whether to repair or retire the unit, we are absolutely committed to making the right decision for our customers and our investors."

Rogers called the Crystal River decision the company's highest priority right now.

He said Duke Energy is entering a mediation process with the insurance company. He conceded that if the insurer pays nothing toward a repair of the unit, then it would probably be retired.

Rogers said Duke Energy, based in North Carolina, is excited to operate in Florida. The 1.6 million customers here represent the second largest jurisdiction for Duke and will account for 20 percent of the revenues in the combined company.

Rogers tried to allay any concerns that Florida customers would be an afterthought in the new now-largest utility in the nation.

"Florida will not be an afterthought. The customers will not be an afterthought."

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