News Release
June 01, 2000

DUKE ENERGY NORTH AMERICA ANNOUNCES STATUS OF SIX PROJECTS TOTALING ALMOST 3,600 MEGAWATTS

HOUSTON – Duke Energy North America (DENA) announced today it is on schedule to bring approximately 2,300 megawatts of new merchant generation capacity online this summer to serve peak demand in the Electric Reliability Council of Texas (ERCOT), East Central Area Reliability Council (ECAR) and New England Power Pool (NEPOOL) regions.

DENA also announced two new 640-megawatt, natural gas-fired facilities scheduled for commercial operation in time for summer 2001. The Lee County, Ill., and Audrain County, Mo., facilities will serve demand throughout the Mid-America Interconnected Network (MAIN) region which is in need of an estimated 13,800 megawatts of new generation capacity over the next decade.

"The Midwest, Northeast and Texas regions are in great need of new generation resources to enhance the adequacy of their regional electricity supply," said Jim Donnell, DENA president and chief executive officer. "Our focus remains on delivering our commitments to supply customers in these markets, while actively managing our portfolio to achieve value for our shareholders. As they did last year with our Madison and Vermillion projects, DENA's Midwest development team has demonstrated its capability to deliver multiple simultaneous transactions."

A leading wholesale energy trader, DENA's energy business is supported by its merchant generation portfolio which includes approximately 5,400 megawatts in operation, 5,000 megawatts under construction and 13,500 megawatts in advanced development through 2003. DENA has a total of 10 projects currently under construction across North America.

DENA is set to deliver 2,300 megawatts of new generation capacity: 520 megawatts to NEPOOL, 1,280 megawatts to ECAR and 500 megawatts to ERCOT over the course of the summer. The NEPOOL, ECAR and ERCOT regions are all expected to experience significant price volatility this summer. Low reserve margins and increasing peak capacity demand will most likely result in upward pressure on power prices in each region.

Serving NEPOOL, DENA's Maine Independence Station, a 520-megawatt natural gas-fired, combined-cycle unit located in Veazie, Maine, became operational in May. The Madison Generating Station and the Vermillion Generating Station, two 640-megawatt, natural gas-fired peaking units located in Ohio and Indiana, respectively, will become commercial over the summer. The two ECAR-based facilities are jointly owned by DENA and Cinergy Capital & Trading, Inc.

The fourth project, the Hidalgo Energy Facility, a 500-megawatt, natural gas-fired, combined- cycle facility, also is scheduled to begin commercial operation over the summer and will serve the ERCOT region. DENA sold its majority position in the Edinburg, Texas, facility in the first quarter but will see the project through to commercial delivery.

Duke/Fluor Daniel is responsible for the design and construction of all the facilities and will operate Maine Independence. Natural gas will be provided to the Maine Independence, Madison and Vermillion merchant units through Duke Energy pipelines. Natural gas supply and power marketing will be managed through DENA's trading affiliate, Duke Energy Trading & Marketing.

"Duke Energy continues to capitalize upon its commercial, development, engineering, procurement and construction skills to deliver projects to market and maintain its first mover advantage," said Donnell. "Clearly, our integrated capabilities allow us to increase shareholder value and deploy capital more efficiently working with internal affiliates as opposed to third parties."

Duke Energy North America (DENA), is a leading wholesale energy services company. DENA, and its affiliates, including Duke Energy Trading & Marketing, supply competitively priced energy, integrated logistics and asset optimization services as well as risk management products to wholesale energy producers and users across North America. To better serve its customers and support its market positions, DENA develops, owns and manages a portfolio of merchant generation facilities. DENA is a wholly owned subsidiary of Duke Energy.

Duke Energy, a diversified multi-national energy company, creates value for customers and shareholders through an integrated network of energy assets and expertise. Duke Energy manages a dynamic portfolio of natural gas and electric supply, delivery and trading businesses -- generating revenues of nearly $22 billion in 1999. Duke Energy, headquartered in Charlotte, N.C., is a Fortune 100 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: www.duke-energy.com.

Contact: Jennifer Pierce
Phone: 713/627-5719
24 Hour Phone: 704/382-8333
Email: jmpierce@duke-energy.com
Contact: Kate Perez
Phone: 713/627-6527
24 Hour Phone: 704/382-8333
Email: kcperez@duke-energy.com