By Michael Brooks
The Federal Energy Regulatory Commission last week approved Duke Energy Progress’ $1.2 billion purchase of 700 MW of generation from the North Carolina Eastern Municipal Power Agency.
The deal will give Duke NCEMPA’s share of the Brunswick and Shearon Harris nuclear plants and the Mayo and Roxboro coal plants, generators that Duke jointly owned with NCEMPA.
Duke and NCEMPA agreed to the sale in late July and submitted it for FERC approval on Oct. 10. (See NCEMPA to Sell 700 MW of Generation to Duke.) There were no protests opposing the deal or comments asking for any conditions. In its order, the commission said it had no concerns about adverse effects on horizontal or vertical competition resulting from the deal.
The deal must still be approved by the Nuclear Regulatory Commission and regulators in North and South Carolina. Company officials are targeting to close in the third quarter of 2015.
According to Duke, NCEMPA members have accrued more than $2 billion in debt and its customers’ rates have increased since the 1980s. While FERC did not say whether it expected rates to go down, it found that rates would not be adversely affected by the deal. Duke will collect $343 million through rates, FERC said, but the company included a five-year hold-harmless commitment that it would not increase rates as part of the deal. NCEMPA members, and their customers, would still be on the hook for paying off the remaining debt, but the sale will significantly lessen it.
