In his first public appearance since Duke Energy merged with Progress Energy, Duke CEO Jim Rogers on Thursday assured Triangle business leaders that the company is committed to keeping a significant Raleigh workforce and apologized for any anxiety caused by the tumultuous merger.
Rogers touched on themes he’s been repeating to company employees on a weekly basis in small group settings and in companywide presentations since the merger was completed in July. After Thursday’s breakfast presentation at the downtown Raleigh Marriott, Rogers delivered a speech that was beamed to about 800 workers in human resources, communications and community affairs in the Carolinas, Florida and the Midwest.
Rogers is sticking closely to his message: that the newly merged electric utility can be trusted to act in the interest of the state and its residents. The 64-year-old CEO also has met privately in recent months with groups of business leaders and local officials to update them on the progress of the $32 billion deal, which includes a cost-cutting strategy of eliminating 1,860 positions.
Charlotte-based Duke has been under scrutiny since merging with Raleigh-based Progress nearly three months ago. The company fired CEO Bill Johnson immediately after the deal closed and reinstated Rogers at the top of what is now the nation’s largest electric utility. The firing is under investigation by the N.C. Attorney General and also by the N.C. Utilities Commission, which had approved the merger with the understanding that Johnson, then Progress’ CEO, would run the combined company.
“The CEO change at the end was a big surprise to this community in particular. That’s not what we had in mind at the start of this long journey,” Rogers said during his speech at the Marriott. “And I’m sorry it created more anxiety about this merger. Some of you already viewed the merger with mixed feelings.”
Rogers emphasized issues that are important to the N.C. Utilities Commission: that Duke is passionate about the Triangle and that the merger will deliver significant benefits to residents, communities and shareholders.
He said Duke’s board made a decision to fire Johnson in the best interest of the company but declined to elaborate. In July, Rogers told the N.C. Utilities Commission during an investigative hearing that Duke’s board was concerned about Johnson’s autocratic management style and lack of transparency with regard to Progress’ nuclear plant performance issues.
Johnson, in his testimony, countered that his firing was the result of Duke’s board having “buyer’s remorse” about the merger when it became apparent that the cost of getting the merger approved by regulators would be hundreds of millions of dollars more than originally expected.
The investigations by the Utilities Commission and the state attorney general are continuing.
The merger savings will come from two areas: from jointly operating power plants and from the elimination of 1,860 jobs over three years.
At the same time, Rogers said that Progress would soon be filing for a rate increase to pay for transmission upgrades and new power plants. Duke also is expected to ask the N.C. Utilities Commission for a rate increase later this year.
Rogers also noted that the $32 billion deal was the most complicated utility merger he had ever done in his 20-plus years as CEO.
“We’re focused every day on delivering on the benefits of this merger – for our customers, communities and investors, as well as our employees,” Rogers said.