Energy News

21
June

Supreme Court decision in AEP v. Connecticut

At the request of petitioners American Electric Power, Southern Company, Xcel Energy and Duke, the U.S. Supreme Court handed down an 8-0 decision holding that the Clean Air Act displaces any common law actions to force greenhouse gas (GHG) emissions reductions from fossil-based power plants.

This reverses a 2009 Second Circuit decision that held that plaintiffs could seek to limit power plant emissions on the theory that contributing to global climate change constituted a nuisance under federal common law.  In the opinion, the Supreme Court found that the Clean Air Act clearly displaces federal common law efforts to regulate GHG emissions, even if the Environmental Protection Agency has not yet set standards under that Act to control emissions.  Moreover, the Supreme Court also found that expert agencies are better equipped than courts to balance environmental, economic and scientific factors to determine the appropriate amount of regulation for any particular GHG-producing sector.To view the opinion click here.

21
June

Duke Energy Ohio Proposes Long-Term Electric Security Plan

CINCINNATI, OHIO -

  • Includes unique mechanism to fund job growth and attract economic investment in the region
  • Preserves customer choice, a competitive energy market and future rate stability
  • Provides better opportunity for financial stability of Duke Energy Ohio

Duke Energy Ohio today asked regulators for approval of an Electric Security Plan (ESP) for its customers beginning Jan. 1, 2012. Under the proposal, rates would be in effect through May 31, 2021.

“We believe this proposal balances the interests of a number of stakeholders including our customers and investors, while ensuring the state’s long-term energy future,” said Julie S. Janson, president, Duke Energy Ohio and Kentucky. “Our customers have told us they want both choice and predictability. We believe our approach promotes competition, offers price stability over the nine-year life of the ESP and satisfies the company’s need to plan for investing in the long-term energy requirements of our region.”

Under the proposed ESP, generation remains unbundled and separate from transmission and distribution service. The plan further unbundles generation service by separating capacity (physical assets) from energy (the actual output). Customers would pay for capacity through a non-bypassable, cost-of-service-based charge, while energy would be priced and purchased through a competitive auction.

In other words, the plan is structured to include a market-based or competitive element, while also affording customers with the stable prices and reliable supply, on which they can depend.

The plan also provides for a unique mechanism in which net profits from the sale of energy and ancillary services from the dedicated Duke Energy Ohio power plants would be shared between customers and the company, 80 percent and 20 percent, respectively.

If approved by regulators, Duke Energy Ohio residential customers who use about 1,000 kWh a month will...

17
June

Duke Energy and Progress Energy to Merge

CHARLOTTE, N.C. AND RALEIGH, N.C. -

  • $26 Billion Transaction Will Create Nation’s Largest Utility with a Combined Enterprise Value of $65 Billion
  • Diversified Generation Portfolio in Six Regulated Service Territories
  • Transaction Expected to be Accretive to Adjusted Diluted Earnings in First Year

Duke Energy (NYSE: DUK) and Progress Energy, Inc. (NYSE: PGN) announced today that both companies’ boards of directors have unanimously approved a definitive merger agreement to combine the two companies in a stock-for-stock transaction. The combined company, to be called Duke Energy, will be the country’s largest utility, with:

  • Approximately $65 billion in enterprise value and $37 billion in market capitalization
  • The country’s largest regulated customer base, providing service to approximately 7.1 million electric customers in six regulated service territories North Carolina, South Carolina, Florida, Indiana, Kentucky and Ohio
  • Approximately 57 gigawatts of domestic generating capacity from a diversified mix of coal, nuclear, natural gas, oil and renewable resources
  • The largest regulated nuclear fleet in the country.

“Our industry is entering a building phase where we must invest in an array of new technologies to reduce our environmental footprints and become more efficient,” said Jim Rogers, chairman, president and chief executive officer of Duke Energy. “By merging our companies, we can do that more economically for our customers, improve shareholder value and continue to grow.

“Combining Duke Energy and Progress Energy creates a utility with greater financial strength and enhanced ability to meet our challenges head-on,” Rogers continued.

“This combination of two outstanding companies is a natural fit,” said Bill Johnson, chairman, president and chief executive officer of Progress Energy. “It makes clear strategic sense and creates exceptional value for our...

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