Duke Energy and Progress Energy have announced the two companies will merge to create the nation’s largest utility, while retaining the name Duke Energy.

The merger, set for January 1, 2012, has been approved by shareholders and awaits approval by the Federal Energy Regulatory Commission. The joining of the companies would create a utility with more than 7 million customers in six regulated service territories, with the headquarters in Charlotte, N.C ., according to Duke Energy’s website.

Randy Paulson, director of construction management and project support at Progress Energy, spoke to N.C . State students about the power business, regulated utilities and the impact of merging the two companies.

“The merger was as big of a surprise to anyone in Progress Energy as it was to you guys,” Paulson said. “But it really does make a lot of sense.”

Paulson said the merger will help the two companies learn more about each other, learn more about the energy and utilities business and cultivate energy production to make it more efficient. The companies will no longer be competing, so now the boundaries will be gone, and according to Paulson, “whoever has the most economic generator will get to generate power.”

The merger will help to fix problems within each of the companies, with the intention of creating a stronger, unified producer, according to Paulson.

“Not a thing about the companies is going to be like the companies were before,” Paulson said, “[For example] Duke’s hydro units are inefficient when trying to figure out economic dispatch.”

The merger will save consumers $600 million after improvements, but “initially rates will go up gradually, because Duke is [also] trying to cover the costs of new plants that it has built,” according to Paulson. Costs for fuel will go down though, Paulson said, and this can be seen in consumers’ energy bills after the merger.

The “biggest hurdle” this merger presents is the effects it will have on the employees of the two companies.  According to Paulson, “out of 30,000 employees at Progress Energy, maybe 300 have been selected to stay within the top 3 tiers of the new company,” while the rest will be subject to a “voluntary severance program.” This program will give employees a choice; if they want to keep their jobs they can wait until after the merger to see if the company still needs them, or they can choose to leave, voluntarily.

Paulson said a lot of people will leave because of this uncertainty, while some older employees will leave to retire permanently. Paulson hopes the severance program will “take care of the head-count reductions” that will be necessary as a result of merging two companies of this size.

But sometimes employees that are asked to stay will leave, or the company will have more leave in one area than they expected, Paulson said, and this creates job opportunities.

“Normally, I would say recruitments on college campuses would not change, but during this specific time, they will increase,” Paulson said. “It’s getting harder to find people in this business; we need younger talent to take on [the merger], but this business is not as glamorous as others.”

Paulson said the company will have 158 manager-level positions, but that the number needs to be 225. “It’s absolutely frightening to think you need to bring that many people into a business,” Paulson said.

Alison Thompson, a senior in economics, listened to Paulson speak on campus and said she was especially interested in this portion of the discussion.

“I find these lectures interesting when it has to do with Raleigh and potential job markets,” Thompson said. “I’m trying to keep my options open and I didn’t know if there were opportunities in the utilities for economics majors.”

Thompson said she sees the merger as a positive move for business and for consumers, despite the negative impact on employees.

According to Bobby Puryear , professor in economics and the faculty advisor for the Economics Society, he organized the lecture to not only inform students about job opportunities, but also to educate students about this current event.

“I like to bring in people to talk about issues that touch economics and current events, and the merger does both,” Puryear said.

Until January, the fate of consumers and those employed will rest with the Federal Energy Regulatory Commission’s decision.