NextEra, Dominion to merge in major utilities announcement
NextEra Energy is set to acquire Dominion Energy, the two utilities announced earlier today in an approximately $67 billion merger that will alter the energy landscape—including for nuclear power—in the United States.
If approved, the two utilities would combine to create the world’s largest regulated electric utility company with a customer base of approximately 10 million. The merger would also create the third-largest energy company, behind ExxonMobil and Chevron. The companies’ boards of directors have approved the transaction, but the merger still requires federal and state regulatory approval as well as shareholder approval. The transaction is expected to close within 12–18 months.
“The combined company's unmatched scale and operating platform would enable us to meet electricity demand while maintaining affordability across Florida, Virginia, North Carolina, and South Carolina,” NextEra president and CEO John Ketchum said in a conference call earlier today.
About the merger: Notable highlights include the following:
- Ketchum will serve as chair and CEO of the combined company, while Dominion Energy president and CEO Robert Blue will serve as president and CEO of regulated utilities and as a member of the board of directors.
- Combined company operations will be more than 80 percent regulated.
- The two companies will maintain dual headquarters in Florida and Virginia and operational headquarters in South Carolina.
- The combined company will include 10 NextEra board members and four from Dominion.
- The company will operate under the NextEra Energy name and trade on the New York Stock Exchange under the ticker symbol NEE.
- The transaction is structured as 100 percent all-stock and is expected to be tax-free to shareholders.
- NextEra and Dominion shareholders will own approximately 74.5 percent and 25.5 percent of the combined company, respectively.
- Dominion Energy's utility companies will continue to operate as Dominion Energy Virginia, Dominion Energy North Carolina, and Dominion Energy South Carolina.
- The company will offer $2.25 billion in bill credits to Dominion customers in Virginia, North Carolina, and South Carolina, spread out over two years post close.
Nuclear power portfolio: While their customers are primarily in Florida, Virginia, and the Carolinas, NextEra and Dominion have nuclear assets outside those states. The merger would create the country’s second-largest generator of nuclear power.
NextEra operates the following nuclear plants:
- Point Beach, a two-unit, 1,230-MWe facility in Two Rivers, Wis.
- Seabrook, a one-unit, 1,248-MWe facility in Seabrook, N.H.
- St. Lucie, a two-unit, 2,136-MWe facility in Jensen Beach, Fla.
- Turkey Point, a two-unit, 1,684-MWe facility in Florida City, Fla.
Dominion operates the following:
- Millstone, a two-unit, 2,121.5-MWe facility in Waterford, Conn.
- North Anna, a two-unit, 1,946-MWe facility in Mineral, Va.
- Summer, a one-unit, 966-MWe facility in Jenkinsville, S.C.
- Surry, a two-unit, 1,748-MWe facility in Surry, Va.
Not included in NextEra’s list is Duane Arnold, the 615-MWe plant in Iowa that the utility is attempting to restart as soon as 2029. Duane Arnold’s boiling water reactor is Iowa’s only nuclear power plant.
What they’re saying: Ketchum called it a “historic moment” not just for the two companies but for the states and customers it serves.
“Electricity demand is rising faster than it has in decades. Projects are getting larger and more complex. Customers need affordable and reliable power now, not years from now,” he said in an announcement of the merger. “We are bringing NextEra Energy and Dominion Energy together because scale matters more than ever—not for the sake of size but because scale translates into capital and operating efficiencies. It enables us to buy, build, finance, and operate more efficiently, which translates into more affordable electricity for our customers in the long run.”
"Most importantly, this combination is built around our customers,” added Blue. “The bill credits we are committing to, the continued investments in generation, reliability and storm resiliency and our commitments to retain our team and dual headquarters in Juno Beach and Richmond, as well as Dominion Energy South Carolina's existing operational headquarters in Cayce, reflect the values that have always defined Dominion Energy. We are excited to bring these great companies together and to write the next chapter in every community we serve."
