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Duke-Progress Energy merger costs weighed

Duke-Progress Energy hearing looks at social and economic issues.

By John Murawski
john.murawski@newsobserver.com

RALEIGH The social and economic costs of the merger of Duke Energy and Progress Energy will get an airing today in Raleigh when public hearings resume on the deal.

The companies have said they will eliminate 2,000 jobs once they consolidate.

Earlier this week the CEOs for both companies made their cases in favor of the $26 billion deal, with Duke CEO Jim Rogers and Progress CEO Bill Johnson contending the combined company would be in a stronger financial position to build power plants while limiting rate increases for customers.

The N.C. Utilities Commission is required by state law to weigh the merger's benefits versus its costs and risks. In Raleigh, the merger will mean dismantling Progress Energy's corporate headquarters and cutting up to 1,000 jobs in the Raleigh area.

The seven-member regulatory agency is expected to approve the merger but has broad powers to impose conditions and terms to guarantee public benefits.

The public got a chance to speak Tuesday, when more than a dozen residents urged the commission to block the merger in a standing-room-only hearing room.

Much of Wednesday was set aside for expert testimony from company executives who discussed affiliate transactions, fuel modeling, dividend payments and equity ratios.

A number of nonprofit advocacy groups say they don't oppose the merger, as long as the benefits outweigh the costs. These organizations say the merger can stimulate job creation by promoting more clean energy programs.

The groups also want to see increased charitable donations to low-income and community assistance programs. Duke and Progress have promised to donate $15 million to such causes, but one advocacy group says the amount should be $270 million.

John Murawski: 919-829-8932

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