Marking the second time it had approved a union between an electric utility and a natural gas pipeline company since issuance of its December 1996 merger policy, the Federal Energy Regulatory Commission has approved the merger of Duke Power Co. with PanEnergy Corp.
In its 21-page order issued May 28, the FERC found the merger consistent with the public interest based on an examination of the effect it would have on rates, competition and regulation (Docket No. EC97-13-000). The FERC concluded that the generating facilities owned by Texas-based PanEnergy are small and are such a great distance from Duke's North Carolina market that it will not affect market concentration. "Geography matters," summarized Commissioner William L. Massey.
Also, the FERC found that the merger would not increase control over electric transmission assets because, with one exception, all transmission facilities owned by the two companies would fall under Duke Power's open-access tariff.
The FERC's quick action on Duke/PanEnergy offers a marked contrast with long delays encountered by Northern States Power Co. and Wisconsin Electric Power, which, after nearly two years, eventually saw their proposed Primergy merger fall apart.
FERC Commission William Massey, speaking at the Washington International Energy Group in Washington, D.C., on May 19, noted the delays in the Primergy case, among other points.