The deal that would allow Duke Energy Progress to buy electricity-generating assets back from some North Carolina municipalities is one step closer to completion.

This week, the Federal Energy Regulatory Commission gave its approval for the deal that would reduce the North Carolina Eastern Municipal Power Agency’s debt by $1.3 billion dollars, to under $500 million. Washington is one of those municipalities, with shares in the assets of two nuclear power plants and two coal-fired power stations and a debt that amounts to approximately $110 million.

“It moved a whole lot quicker than we thought it would,” said Washington City Manager Brian Alligood. “But when Duke filed it, they asked for an expedited review. … This is one more hurdle that’s been cleared in the process. There’s still several more to go, but this is very positive.”

What it means for Washington Utilities customers is that a reduction in utilities rates may be ahead — a positive proposition considering the city has been weighing an increase in service fees and property taxes to make up for a coming budget shortfall of over $100,000. The North Carolina General Assembly’s decision early this year to eliminate business license taxes across the state, left many municipalities pondering how those funds will be replaced.

“The intent is to pass those savings along in the form of reduced rates,” Alligood said. “But we don’t know what those savings will be as of yet.”

Alligood said City Council has given no indication that freed-up funds from the Duke Energy Progress and NCEMPA deal will be used to fill in the city budget — in fact, the council has indicated that it intends to do the opposite, reducing the transfer from the electric enterprise fund — made up of a fee charged to Washington Utilities in lieu of taxes — to the city’s general fund.

The General Assembly will also weigh in further step in the process: giving its approval to refinance the NCEMPA debt, which Alligood said appears to have support from lawmakers statewide.

“What we have heard from our local delegates is they’re supportive of it,” Alligood said.

The city manager also said the debt reduction and potential cost savings for Washington Utilities customers will strengthen Washington’s ability to be competitive to industry.