Year in review: Duke-Progress energies merger
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CHARLOTTE--At the beginning of 2012, the Duke-Progress merger was at a stand still.
Federal regulators rejected it twice, but the companies insisted it was the right move.
"By operating together, we'll just be able to operate cheaper,” said Tom Williams.
The Federal Energy Regulatory Commission signed off on the deal June 8 and by the end of the month, so had North Carolina regulators.
On July 2 the merger was official, but there was one big catch.
"Bill Johnson has resigned as president and chief executive officer by mutual agreement with the board,” said Ann Maynard Gray.
Bill Johnson, the Progress Energy CEO, was ousted as the combined company's top executive, minutes after the deal closed.
The board kept Duke Energy CEO Jim Rogers on instead.
In response, the N.C. Utilities Commission launched an investigation, ordering Rogers to appear and explain what happened.
"It's just as simple as the board lost confidence in his ability to lead,” said Rogers.
Rogers said the board thought Johnson was autocratic, but in his testimony a week later, Johnson defended himself.
He said the real reason he was fired was because Duke wanted out of the deal.
"They wanted the merger. Then they didn't want it. Then they couldn't get out of it, then they didn't want to be stuck with me,” said Johnson.
The N.C. Utilities Commission wanted to know if Duke directors misled regulators about the-behind-the-scenes effort to oust Johnson, but board members said no.
"Until we made the decision and actually had a vote on July 2nd, there was no decision to inform you of,” said Gray.
The N.C. Utilities Commission asked Duke to turn over thousands of pages of documents related to the deal.
State Attorney Gen. Roy Cooper launched a separate investigation.
All sides worked for months to resolve the probes.
At the beginning of December, Duke finalized settlements that did just that.
"These settlement agreements are good for consumers and the regulatory process,” said Kevin Anderson.
As part of the agreements, Rogers will retire at the end of 2013, Duke will maintain a presence in Raleigh and it will pass along $25 million in savings to customers.
The settlements start the process of rebuilding public trust.
"There is no doubt that the trust relationship and the mutual respect has been damaged. We know that it needs to be repaired,” said Duke attorney Dwight Allen.
That trust is important because Duke plans to ask for rate increases for all N.C. customers by the middle of 2013.