The proposal achieves the same ambitious emission reduction targets outlined in Senate Bill 1078 that passed the N.C. Senate in 2001. It also allows Duke Power to recover most of the estimated $1.5 billion necessary to achieve these emission targets without increasing base electric rates or adding a cost recovery rider.

“We think the proposal is an innovative and creative approach that enables North Carolina to exceed federal air emissions standards for power plants in the most cost-effective way,” said Richard B. Priory, chairman, president and chief executive officer of Duke Energy. “It allows us to recover the costs of meeting very ambitious emission reduction targets while keeping current rates frozen for five years. Not only does that eliminate the need for the rider in last year’s legislation, it provides our customers with rate stability for the years ahead.”

Duke Power has a demonstrated track record of serving its customers at the lowest possible cost.  The company’s current rates are at 1986 levels and are among the lowest in the United States – in spite of inflationary pressures. The proposal provides customers with additional stability and predictability with electric rates for the next five years.

“This proposal strikes a balance between decreasing power plant emissions and keeping customer rates as low as possible to help our economy recover,” said William A. Coley, president of Duke Power. “While committing to freeze rates from 2002 until 2007 will be a major challenge for us, it is doable and we are committed to making it happen.” 

The proposal calls for Duke Power to reduce sulfur dioxide emissions from its fossil-fueled power plants in North Carolina by 70 percent by 2013 and reduce nitrogen oxide emissions by 33 percent by 2007. These emission reductions go beyond federal standards and are in addition to Duke Power’s investment of more than $550 million to reduce nitrogen oxide emissions by approximately 75 percent by 2004 as required by the federal Clean Air Act.      

Duke Power, a business unit of Duke Energy, is one of the nation’s largest electric utilities and provides safe, reliable, competitively priced electricity to approximately two million customers in North Carolina and South Carolina. Duke Power operates three nuclear generating stations, eight coal-fired stations, 31 hydroelectric stations and numerous combustion turbine units. Total system generating capability is approximately 19,300 megawatts. More information about Duke Power is available on the Internet at:  www.dukepower.com.

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 $59 billion in 2001. 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.