CHARLOTTE, N.C. -- The N.C. Utilities Commission has formally approved the settlement ending its investigation of the Duke Energy-Progress Energy merger, saying the agreement terms “restore the balance” intended between the two companies.
The order issued Wednesday affirms the commission’s verbal approval last week.
The investigation probed whether the commission was misled about the management of the combined companies. Duke’s board fired Progress chief Bill Johnson, the expected CEO, shortly after the $32 billion merger closed July 2.
Under the settlement terms, Duke CEO Jim Rogers will retire at the end of 2013, when his contract expires. Duke agreed to replace two other executives and add $25 million to the $650 million in merger savings it has guaranteed Carolinas customers.
Duke will keep at least 1,000 employees in Raleigh, the former Progress headquarters, for at least five years.
The commission order quoted court rulings depicting the nature of regulated utilities. Companies are granted territorial monopolies and stable earnings, as a federal appeals court put it, in return for “intensive regulation” not found in the free market.
“When representations are made to the Commission with the intent that the Commission rely upon them and changes occur so that the representations are no longer accurate, it is incumbent upon the utility to set the record straight and prevent the Commission from proceeding to act upon facts that are no longer correct,” the North Carolina order reads.
Duke has said its directors were within their rights to remove Johnson. They couldn’t report the change in leadership to the commission, the company said, before directors voted on it.
Rogers wrote a letter of apology to the commission on Monday.
Duke’s apology and the settlement terms “restore the balance between legacy Duke and legacy Progress,” and “reaffirms the regulatory compact and continued public confidence in the integrity of utility regulation,” the order concludes.