News Release
May 02, 2001

Duke Energy Releases Action Plans for Energy Crisis

CHARLOTTE, N.C. -- Duke Energy today confirmed it had proposed a "good faith" preliminary global settlement to help solve the California energy crisis and released the full text of two comprehensive documents sent to the governor's office.

"Duke Energy has long been committed to working with stakeholders to resolve California's energy crisis. These comprehensive documents were created to encourage dialogue and decision-making on actions that could be taken to restore stability to California's energy market," said Jim Donnell, president and chief executive officer of Duke Energy North America.

"We delivered documents in April to the governor outlining the elements for a comprehensive California three-year energy plan, along with a framework for a global settlement," Donnell said. "Elements of a Comprehensive California Three-Year Energy Plan" offers a comprehensive blueprint to increase the state's energy supply stability. The plan sets out specific action steps for new generation, conservation programs, electric and gas infrastructure improvements, regional transmission frameworks and environmental goals.

"We hope the governor will take a hard look at the initiatives we offer in the comprehensive plan and be willing to sit down with all stakeholders to immediately begin implementing solutions that will assure California consumers adequate, reasonably priced electricity," Donnell said.

In March, Duke Energy provided to the governor's office the framework for a "global settlement" to help solve California's electricity crisis. Global settlements are used frequently in other matters where the various issues are complex and encompassing.

"The goal of the global settlement was to provide electricity to consumers at a fair and reasonable price. Our proposals identify creative solutions to reach this goal. By rapidly adding more generation to the market, by entering long-term contracts that assure a reliable supply of power on reasonable terms and by moving past the contentious legal issues, we could stabilize this very difficult situation," Donnell said.

Duke Energy's settlement included:

"Duke Energy has worked tirelessly with local, state and federal officials to offer concrete, creative solutions to California's energy crisis," said Donnell. "In 1998, we began a program to increase the generating capacity at our California plants. In July 2000, we offered low-cost, long-term contracts for electricity. We ran our plants flat out to produce 50-percent more electricity in 2000 than in 1999. And, we said more than a month ago that we would be willing to forgive a portion of the amount we are owed for the electricity we supplied if credit issues are promptly resolved.

"The three-year plan and global settlement proposals are more examples of initiatives by Duke Energy to help solve California's energy crisis. We remain committed to working with all stakeholders to take the bold steps necessary to solve this crisis," Donnell said.

The documents, "Elements of a Comprehensive California Three-Year Energy Plan" and the "Preliminary Global Settlement Template," as well as other documents related to actions Duke Energy has taken during the California energy crisis, are available on the company's California Web site: http://duke-energy.com/california

Duke Energy, a diversified multinational 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 more than $49 billion in 2000. 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: Tom Williams
Phone: 805-595-4270
24 Hour Phone: 704-382-8333
Email: tcwillia@duke-energy.com
Contact: Cathy Roche
Phone: 04-373-4860
24 Hour Phone: 704-382-8333
Email: csroche@duke-energy.com