Progress Energy and Duke Energy are expected to complete their multibillion-dollar merger in the next week. It will create the largest electric utility in the country, with more than 7 million customers in six states and 27,000 employees.
So what does this all mean for Progress Energy customers? Here's what you need to know:
Will the merger make my rate go up?
At least not as an immediate result of the merger.
Progress Energy says the merger will not affect Florida retail rates. Rate adjustments will be based, as they are now, on Florida needs. The state Public Service Commission must approve any rate changes. Over time, Progress expects the merger to help the company run more efficiently and reduce the impact of future increases.
Progress Energy Florida customers currently pay significantly higher rates than customers of Tampa Electric and Florida Power & Light, which covers most of South Florida.
Progress CEO Bill Johnson and Duke CEO Jim Rogers say U.S. utilities will need to continue getting larger to support increased demand for power. The larger the utility, the greater its ability to attract capital to invest in new projects. It also increases the utility's influence in the business and political worlds.
What will the merger mean for Progress Energy's broken Crystal River nuclear plant and the proposed Levy County nuclear project?
Duke maintains that it supports Progress' plan to repair Crystal River, but the new board could decide otherwise and choose to decommission it. The proposed $24 billion Levy County nuclear project now is in competition with other proposed nuclear projects that Duke Energy was pursuing. It is unclear which, if any, the new company board will support.
Will the merger result in layoffs?
The merger is expected to result in more than 1,800 job cuts, many of which have already taken place. More than 1,100 come from voluntary severance, 368 from vacancies and about 350 through cuts, including some potentially in Florida.
Where will I send my bill?
The same place you do now. Progress Energy Florida has not announced any changes to bill payment processes or locations as a result of the merger.
Where will I find information about my utility online?
After the merger, Progress Energy Florida customers can continue to access information about the utility and their accounts at progress-energy.com.
Will the name of my utility remain Progress Energy or change to Duke Energy?
Progress Energy Florida will remain the name of the company's Florida arm in the near term. Progress Energy Florida's headquarters will remain in St. Petersburg. The overall company will be known as Duke Energy, with headquarters in Charlotte, N.C.
Will customer service representatives remain in Florida or will I get someone outside my state?
The combined company will have increased resources to meet customers' needs 24 hours a day, seven days a week. Progress says, "Our customer service representatives will be positioned to efficiently and effectively address our customers' needs."
What happens to the stock Progress Energy shareholders have now?
Progress Energy stock will be replaced with Duke Energy stock after the merger. Progress Energy's shareholders will receive 2.6125 shares of common stock of Duke Energy in exchange for each share of Progress Energy common stock.
Progress Energy shareholders would receive a value of $46.48 per share, or $13.7 billion in total equity value. Duke Energy also will assume approximately $12.2 billion in Progress Energy debt.
Who will run the new combined company?
Progress Energy CEO Bill Johnson, who had been slated to be chief executive and president of the combined company, resigned by mutual agreement, and Duke's Jim Rogers will assume the role as the merger between the two utilities closed.
Rogers, who originally served as Duke Energy's CEO, was initially slated to be the executive chairman of Duke Energy after the merger.
The board will have 18 members, with 11 picked by Duke's current board and seven by Progress' current board. Of its top 13 officers, seven would come from Duke and six from Progress. Vincent Dolan will remain the president and chief executive officer of Progress Energy Florida.
How will the merger affect Tampa Electric?
Tampa Electric, already the smallest of the state's investor- owned utilities, will look even smaller compared to the combined Progress-Duke company and Florida Power & Light, the state's largest utility that is part of the massive NextEra Energy. So far there has been no talk of takeover of Tampa Electric, whose parent is TECO Energy.
Ivan Penn can be reached at [email protected] or (727) 892-2332.