Kentucky’s two largest electric utilities – Louisville Gas andElectric (LG&E) and Kentucky Utilities (KU) – won final FERCapproval for their merger Wednesday, paving the way for itscompletion sometime in the second quarter, the utilities said.
“At this point, FERC was the last major hurdle that we had,”noted KU spokesman Cliff Feltham. The deal, however, still needsthe blessing of the Federal Trade Commission and the Securities andExchange Commission, which “should come fairly soon.”
The merged company, which will be named LG&E Energy, willhave electric and natural gas assets worth more than $4.7 billionand will serve more than 1.1 million customers in Kentucky and apart of Virginia, Feltham said. The new company will serve Kentuckypractically in its entirety, with the only competition coming fromrural co-operatives and American Electric Power in the eastern endof the state.
KU owns nine power plants in Kentucky, 99% of which are coalfired, and has enough electric distribution and transmissionfacilities to serve 77 or the state’s 120 counties, Feltham noted.It does not have any gas assets. LG&E, on the other hand, ownsand operates 3,600 miles of gas distribution, 178 miles oftransmission and five underground gas storage reservoirs inKentucky, as well as electric generation, transmission anddistribution facilities. The merger also will include LG&EMarketing, a power marketer.
LG&E and LG&E Marketing are subsidiaries of LG&EEnergy Corp., an exempt holding company under the Public UtilityHolding Company Act (PUHCA); KU is a subsidiary of KU Energy, alsoan exempt holding company.
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