Duke Energy and Progress Energy have filed a revised wholesale market power mitigation plan with the Federal Energy Regulatory Commission (FERC) as part of their proposed merger.
The plan provides more details on the notice of intent to file a mitigation plan submitted to the North Carolina Utilities Commission (NCUC) on Feb. 22. It requests that the FERC issue orders approving the mitigation plan, the Joint Dispatch Agreement and the Joint Open Access Transmission Tariff within 60 days of the filing and no later than June 8, 2012. The companies intend to seek final merger-related approvals from the NCUC and the Public Service Commission of South Carolina prior to the July 8 merger agreement termination date.
The following are key elements of the mitigation plan:
The FERC filing features a permanent mitigation plan with seven transmission projects, estimated to cost US$110 million. The transmission projects significantly increase the power import capabilities into the Progress Energy Carolinas and Duke Energy Carolinas service areas and enhance competitive power supply options in the region.
The proposal features a two- to three-year interim mitigation plan with must-deliver, must-take power purchase agreements with Cargill Power Markets, LLC; EDF Trading North America, LLC; and Morgan Stanley Capital Group Inc. The companies will sell 800 MW during summer off-peak hours, 475 MW during summer peak hours, 225 MW during winter off-peak hours and 25 MW during winter peak hours. The agreements, or similar power purchase agreements, will be in place from the date the merger closes until the transmission projects are operational.
Potomac Economics will serve as the independent monitor of the interim power purchase agreements and a component of the permanent mitigation plan.
For planning purposes, the companies plan to close the merger on July 1.
For more information, visit www.duke-energy.com/progress-energy-merger.