Officials want the person chosen for the job to be given the title of deputy secretary.
But this has yet to be approved by the Treasury because it would mean paying a salary of £64,000-£75,000 - about £14,000 more than directors are paid for nine other regional government offices.
The directors for these posts - which bring together the management of the DoE, Department of Transport, Department of Trade and Industry and Department of Employment - were chosen this week from among existing senior civil servants.
Environment Secretary and Minister for London John Gummer said London's regional director will be appointed in the New Year.
Heads of DoE and DoT offices - which have long been under the direction of a single civil servant in all areas outside London - have won just three of the new regional directorships.
The extra responsibilities of the heads of these departments mean they are the only regional directors who are certain to be under secretaries.
The appointment of outsiders was always likely therefore to be seen as a defeat for the DoE.
At the same time, officials were anxious to demonstrate that the integrated regional offices did not represent a takeover by the DoE, which now administers the bulk of the funds which will be available under a new £1.4 billion single regeneration budget.
Brian Leonard, who headed the DoE's northern region, has been moved to take over the integrated south west office.
John Stoker, former director of Merseyside's office, takes over the new office. Merseyside has no DTI or DE representatives.
David Ritchie, the main DoE/DoT representative in the west midlands won the top job in that region. Mark Lanyon, DTI director in Yorkshire and Humberside, takes over the east midlands office. Pamela Denham, DTI head in the north east, will run the new integrated office. Marianne Neville Rolfe, chief executive of the civil service college, will run the north west office.
Gillian Ashmore, on secondment from the DoT to help British Rail with its privatisation plans, will take over the south east office. Jeremy Walker, DE director in Yorkshire and Humberside, will take over that region.
The current heads of London regional offices are Ian Jones (DTI), Angela Heath (DoE), Irving Yass (DoT) and Win Harris (DE).