Clean energy groups have reached an agreement with Duke Energy and Progress Energy to address concerns the groups raised in a South Carolina Public Service Commission proceeding on the proposed merger of the two companies. If the merger is approved, the newly formed holding company, Duke Energy, will be the largest electric utility in the country. Two subsidiaries, Duke Energy Carolinas and Progress Energy Carolinas, will continue as operating companies in South Carolina and North Carolina.
Under the agreement, the two operating companies will set specific energy efficiency targets, contribute funding to renewable energy development in South Carolina, and commit to an enforceable schedule for retiring certain older coal-fired power plants (previously announced by the utilities) in the Carolinas that lack modern pollution controls. The two operating companies will:
- Each adopt an annual energy efficiency (EE) savings target of 1% of retail sales starting in 2015, and a cumulative target of 7% of retail sales from 2014 to2018. The targets are subject to the companies’ good-faith efforts to submit and obtain approval of EE programs under applicable North Carolina Utilities Commission and South Carolina Public Service Commission processes;
- Contribute a total of $1 million a year for two years to Palmetto Clean Energy, Inc., a South Carolina non-profit organization that promotes and supports locally produced renewable energy and delivery of renewable energy to the electric grid; and
- Commit to schedules to retire older coal-fired power plants that lack modern pollution controls, totaling more than 3,000 megawatts. The companies previously announced these coal-plant retirements as part of the non-binding, long-range plans they submit each year to the state utility commissions. The settlement agreement renders those commitments enforceable. A provision in the agreement allows the companies to seek an extension if these retirements would compromise reliability in its service area.
Southern Environmental Law Center negotiated the agreement on behalf of Environmental Defense Fund, the Coastal Conservation League, and Southern Alliance for Clean Energy. The groups intervened in the merger proceedings to advocate for inclusion of clean energy programs as a result of the merger. The agreement, which impacts the companies’ operations in both South Carolina and North Carolina, was signed by the parties on December 8. For more information, see the Southern Environmental Law Alliance press release