Home » Chairman’s Letter to Stakeholders » Our Priorities, Progress, and Outlook

Our Priorities, Progress, and Outlook

Finalize merger with Progress Energy
  • Announced top-tier management team for combined company
  • Merger teams have begun initial integration planning
  • Plan to begin making state and federal regulatory filings in first quarter 2011
  • Targeting close of merger transaction by end of 2011
Continue operational performance of fleet and grid
  • Achieved record capacity factor for nuclear fleet in 2010
  • Achieved record generation levels for nonregulated Midwest generation in 2010
  • Continue focus on operational excellence
Aggressively manage capital and operating and maintenance costs
  • Maintained relatively flat adjusted net operating and maintenance costs1 from 2007-2010
  • Modest increases to costs anticipated as major construction projects come on line in 2011 and 2012
Grow adjusted diluted EPS and the dividend
  • Realized adjusted diluted EPS growth of approximately 17 percent in 2010
  • Increased quarterly dividend from $0.24 per share to $0.245 per share during 2010
  • Delivered Total Shareholder Return of 9.5 percent during 2010
  • Targeting 2011 adjusted diluted EPS range of $1.35-$1.40
  • Targeting a long-term dividend payout range of 65 to 70 percent of adjusted diluted EPS
  • Project a dividend increase in 2011 (subject to Board of Directors discretion and approval)
Maintain balance sheet strength
  • Credit ratings affirmed in January 2011
  • Issued over $285 million of equity through internal plans during 2010
  • Maintain current credit ratings
  • Project no equity issuances through 2013 based on current business plan
Obtain constructive regulatory outcomes
  • No significant regulatory outcomes were reached during 2010
  • Plan to file rate cases in up to three of our regulated jurisdictions in 2011
Complete major construction projects on budget and on time
  • Major construction projects are on time and on budget, except for Edwardsport
  • Expect to bring Buck combined-cycle plant on line in 2011
  • Work toward a constructive outcome with the Edwardsport cost increase proceedings
Advance legislative agenda to reduce regulatory lag
  • Planning for legislative agendas
  • Propose legislation to address regulatory lag and the timely recovery of investments, such as new nuclear
Position Midwest generation business for the long term
  • Filed a Market Rate Offer (MRO) in November 2010, proposing generation rates for Ohio customers in 2012 and beyond; in February 2011, PUCO failed to approve our MRO filing; we are currently exploring options
  • Achieve a constructive outcome for generation pricing in Ohio
Strategically respond to customer switching pressures in Ohio
  • Duke Energy Retail has retained approximately 60 percent of Duke Energy Ohio's switched customers
  • Respond to additional customer switching pressures in Ohio through Duke Energy Retail
Strategically invest in the renewable energy and International businesses
  • Grew the renewable generation portfolio by over 250 megawatts during 2010
  • Continue to evaluate investment opportunities

1Net of deferrals, cost recovery riders and special items