The new, expanded Duke Energy (NYSE: DUK) will take a fresh look at whether to repair Progress Energy’s Crystal River nuclear Unit 3 in Florida or whether to retire the unit and replace the roughly 860 MW with power generation from other sources.
Duke head Jim Rogers touched on the future of the troubled Crystal River nuclear plant during his protracted testimony before the North Carolina Utilities Commission (NCUC). The July 10 testimony centered on the unexpected termination of former Progress CEO Bill Johnson from his new job as president and CEO of the two merged companies on July 2.
“The call is whether to repair or retire,” Rogers told the North Carolina commission about Crystal River Unit 3 (the four other units at the plant are coal-fired). Rogers said the incumbent Duke board was concerned that Progress was “marching toward repair and eliminating the option to retire.”
The chief issue at Crystal River Unit 3, which has been idle since 2009 and not expected to return to service until 2014, “is what is to come,” Rogers said.
After 18 months, Duke and Progress completed their merger on July 2. The new board of the combined company went into executive session and voted, 10-5, along company lines to terminate Johnson’s contract as president and CEO of the combined company. The board named Rogers, the longtime Duke Chairman, president and CEO to the same posts in the expanded company. Rogers, who is in his 60s, had already announced plans to retire as a CEO and accept the post of executive chairman at the combined Duke.
Rogers altered his plans at the request of the board of the combined company, Rogers told the North Carolina commission. While both NCUC and North Carolina’s attorney general are both looking into the post-merger CEO shuffle, neither commissions in South Carolina nor Florida have announced similar moves.
The Florida PSC will hold a regularly-scheduled status update review on the Crystal River nuclear unit on Aug. 13. The preliminary cost estimate for the repair, as filed with the Florida PSC in June 2011, is between $900m and $1.3bn.