Settlement reached in Kentucky utilities bid

Among the settlement terms, PPL agreed that the two utilities would commit not to implement any base rate increases before January 1, 2013. But rate increases that took effect last month will remain in place, the company said.

The deal allows the utilities to seek approval for the deferral of "extraordinary and uncontrollable costs," however.

The agreement also requires PPL to split earnings above a 10.75 percent return on equity with customers.

The Kentucky Public Service Commission is expected to make a decision on the proposed acquisition by the end of the month.

"We are hopeful that the Kentucky PSC will agree with the parties to this settlement and conclude this acquisition is consistent with the public interest," said James Miller, PPL's chairman, president and chief executive.

The Federal Trade Commission and the U.S. Department of Justice reviewed the proposed offer for possible antitrust issues and cleared the deal last month.

The deal also must be cleared by the Tennessee Regulatory Authority, Virginia State Corporation Commission and Federal Energy Regulatory Commission.

Louisville Gas & Electric and Kentucky Utilities provide electricity to 941,000 customers in Kentucky, Virginia and Tennessee.