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Duke Energy CEO Says Indiana Can Become a Crossroads for Energy October 31, 2007

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The following are excerpts from a speech Duke Energy Chairman, President and CEO Jim Rogers gave today to the Economic Club of Indiana in Indianapolis.

To ensure a sustainable and secure energy future, I have two aspirations for this country – that we substantially decarbonize our energy supply in this century and that we become the world’s most energy-efficient economy.

Practically speaking, the way we can begin to achieve these aspirations is to take an entirely new path – and change the way we think about and use energy in this country. 

In addition to being known as the nation’s highway hub – Indiana is positioning itself to become the Crossroads of America for energy as well.

An energy plan for Indiana
I applaud Governor Daniels’ “Homegrown Energy” plan – which puts that classic Midwestern quality of self-reliance at the heart of Indiana’s long-term energy vision.

But the governor’s plan doesn’t stop there. His vision is to turn Indiana’s homegrown natural resources into an economic engine.  As Indiana’s largest electric supplier, Duke Energy looks forward to being part of that destiny, through our proposed Edwardsport coal-gasification plant and pursuit of renewable energy and energy efficiency.

Just last week, Duke Energy issued bids for power from renewable energy sources – including sun, wind, water, organic matter and other sources. Earlier this year, we agreed to purchase energy from Indiana’s first commercial wind farm, in Benton County, beginning in the spring of 2008. We are also collaborating with Purdue University on wind-power research, and on the potential for using switch grass as a fuel combined with coal.

The low hanging fruit is energy efficiency, and it’s available now.

  • It will help meet growing energy demand – which in this country is expected to grow by 40 percent by the year 2030.
  • It is economical – even compared to the cost of building traditional generation.
  • It will help us address global climate change. If we can find ways to use less energy, that means fewer power plants will have to be built. It also means we can retire our older, higher-emitting power plants, sooner.

Utilities uniquely positioned to deliver energy efficiency
Duke Energy has an established relationship of mutual trust with our customers. Just as we provide them with the electricity they need – we are also in a position to provide them with universal access to energy-efficiency programs and services. 

We’ve traditionally been rewarded for selling more of our product, not less. But if we can help meet customers’ energy needs with less electricity – at less cost and with less environmental impact – shouldn’t we be doing that as well? 

We can provide the same or even greater value to our customers by helping them save energy as we do by supplying it.

We are working to change the regulatory model in the states we serve, so that companies like ours have the incentive to provide energy-efficiency products and services.
 
Earlier this month, we filed a request with the Indiana Utility Regulatory Commission to increase by more than 10 times the energy savings we get from our efficiency programs for Indiana customers. We have filed similar proposals in North Carolina and South Carolina, and we plan to introduce them also in Ohio and Kentucky over the coming six months. If approved in all five states we serve, we project that we could avoid building more than 6,000 megawatts of generating capacity by the year 2017.

We will be paid only for the results we achieve – not for how much we spend on energy-efficiency programs. That has been the traditional approach. If we can demonstrate that we are successful in reducing demand, customers will pay approximately 10 percent less than the cost of building and operating new power plants to meet that same demand. And customers who take full advantage of energy efficiency programs will see their power bills go down. 

Cathedral thinking
In the year 2000, the National Academy of Engineering chose the electrification of America and the developed world as the greatest engineering achievement of the 20th century – ahead of air and space flight, television, the computer and the Internet. I believe that turning the electric grid into a digital-communications and energy-efficiency network could very well be one of the greatest achievements of the 21st century.

This is consistent with a philosophy I call “cathedral thinking.” The great cathedrals of Europe were built, not in a matter of months, or even years – but over many decades, in some cases centuries. Most of the craftsmen and laborers who painstakingly built them, stone by stone, did not live to see the end result. But that did not dampen their creativity, or their resolve to build lasting monuments to their beliefs. The vision of the architects, the stonemasons, the carpenters and the clergy who built them shared one purpose – to create a lasting legacy. 

In addressing today’s energy challenges, we must take the same approach as those cathedral builders took centuries ago. We can’t change the world in one day, one week, one month, one year or one decade. We must build on our commitment over time, and have faith that our work will eventually achieve our highest aspirations.

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Duke Energy, one of the largest electric power companies in the United States, supplies and delivers energy to approximately 4 million U.S. customers. The company has approximately 37,000 megawatts of electric generating capacity in the Midwest and the Carolinas, and natural gas distribution services in Ohio and Kentucky. In addition, Duke Energy has more than 4,000 megawatts of electric generation in Latin America, and is a joint-venture partner in a U.S. real estate company.

Headquartered in Charlotte, N.C., Duke Energy is a Fortune 500 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
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