Shareholders for Florida utilities giant NextEra Energy and Dominion Energy of Virginia have voted their respective approvals for a proposed $67 billion merger, but the two companies are looking at roughly a year of regulatory and public questions before the deal closes.
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NextEra, the parent of Florida Power & Light, and Dominion, which dominates Virginia and North and South Carolina, announced the approvals in filings with the Securities and Exchange Commission late last week.
Both firms, which will remain separate until the deal is complete, have said they expect the deal to be completed in late 2027, according to filings. But to get there, they must confront an array of questions from elected and regulatory officials in Dominion’s home state of Virginia and elsewhere.
The questions include how its growth would be financed, how growing consumer service demands will be met, how its sheer size would influence other regional markets and how it would handle the surging growth of data centers.
Last month, Virginia Gov. Abigail Spanberger announced that she will intervene with the State Corporation Commission to raise questions about the merger. In an op-ed published in the Washington Post, she cited three “non-negotiable priorities” that will guide her as the commission conducts its review of the proposed merger: “delivering more affordable energy bills for Virginia families and small businesses, protecting Virginia’s utility workforce, and accelerating Virginia’s progress toward producing affordable, reliable, local, and clean power into the future.”
The governor also noted she has signed bills into law to lower energy costs for residential and small business customers. They include a “first-of-its-kind statewide consumption tax” to ensure data centers “pay their fair share for the power they use.” The commission recently ordered data centers to cover the cost of transmission infrastructure built exclusively for them.
In Connecticut, Gov. Ned Lamont and Attorney General William Tong also announced in August that their state is intervening in the regulatory review of the proposed merger, “arguing it poses a great risk to Connecticut families who already face unaffordable energy costs. The $67 billion merger would create one of the world’s largest utility companies and place control of all of New England’s nuclear power under one entity, effectively eliminating price competition for a resource that provides a majority of the state’s power, the two top state executives said in a news release.
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Although Dominion does not provide direct electricity service to businesses and residences in Connecticut, it is “one of the nation’s leading developers and operators of regulated offshore wind and solar power,” and is “the largest producer of carbon-free electricity in New England,” the company says on its website.
A deal designed to cover costs
In a July statement from the two companies when they filed their merger proposal with the SEC, the leaders of each said the utilities had affordable costs in mind as they contemplated the deal.
John Ketchum, the NextEra chairman, president and CEO, said the combination “is about putting scale and a stronger, more comprehensive platform behind Dominion Energy’s local teams so they can meet growing power demand while keeping bills affordable and service reliable.”
“Together, we will be better positioned to partner with states and communities to attract new investment, support new jobs and invest in the … energy infrastructure customers need, including renewables, battery storage, nuclear and gas-fired generation,” he said.
Robert Blue, chair, president and CEO of Dominion, said it was about preserving the utility system its customers know “while adding capabilities that can help us build needed infrastructure more efficiently and keep bills affordable.”
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Transaction profile:
- Value: Up to $67 billion.
- Ownership: NextEra Energy investors own 74.5%; Dominion Energy shareholders 25.5%.
- Customers: 10 million accounts in Florida, Virginia, North Carolina, and South Carolina.
- Headquarters: There will be two — Juno Beach, Florida, and Richmond, Virginia.
- Deal’s target closing: Second half of 2027, depending on regulatory approvals.