Profile: Duke Energy Corporation (DUK)

Duke Energy Corporation (Duke Energy) is an energy company that provides its services through three business segments. The Company’s business segments are U.S. Franchised Electric and Gas, Commercial Power and International Energy. During the year ended December 31, 2008, Crescent was a reportable business segment of Duke Energy. However, in 2008, the Company included the operations of Crescent Other business segment. In September 2008, the Company acquired Catamount Energy Corporation from Diamond Castle Partners. In June 2009, the Company's affiliate acquired Aguaytia Energy, LLC from The Maple Gas Development Corporation, a partially owned subsidiary of Maple Energy plc.

U.S. Franchised Electric and Gas

U.S. Franchised Electric and Gas generates, transmits, distributes and sells electricity in central and western North Carolina, western South Carolina, southwestern Ohio, central, north central and southern Indiana, and northern Kentucky. U.S. Franchised Electric and Gas also transports and sells natural gas in southwestern Ohio and northern Kentucky. It conducts operations primarily through Duke Energy Carolinas, Duke Energy Ohio, Inc. (Duke Energy Ohio), Duke Energy Indiana, Inc. (Duke Energy Indiana) and Duke Energy Kentucky, Inc. (Duke Energy Kentucky). U.S. Franchised Electric and Gas’s service area covers about 48,000 square miles with an estimated population of 11 million in central and western North Carolina, western South Carolina, southwestern Ohio, central and southern Indiana, and northern Kentucky.

U.S. Franchised Electric and Gas supplies electric services to approximately 4 million residential, commercial and industrial customers over 150,900 miles of distribution lines and a 20,900-mile transmission system. U.S. Franchised Electric and Gas provides domestic regulated transmission and distribution services for natural gas to approximately 500,000 customers via approximately 7,200 miles of gas mains (gas distribution lines that serve as a common source of supply for more than one service line) and service lines. Electricity is also sold wholesale to incorporated municipalities and to public and private utilities.

Electric energy for U.S. Franchised Electric and Gas’ customers is generated by three nuclear generating stations with a combined net capacity of 5,173 megawatts (including Duke Energy’s 19% ownership in the Catawba Nuclear Station), 15 coal-fired stations with a combined net capacity of 13,472 megawatts (including Duke Energy’s 69% ownership in the East Bend Steam Station and 50.05% ownership in Unit 5 of the Gibson Steam Station), 31 hydroelectric stations (including two pumped-storage facilities) with a combined net capacity of 3,263 megawatts, 15 combustion turbine (CT) stations burning natural gas, oil or other fuels with a combined net capacity of 5,245 megawatts and two combined cycle (CC) stations burning natural gas with a net capacity of 285 megawatts.

Commercial Power

Commercial Power owns, operates and manages non-regulated power plants and engages in the wholesale marketing and procurement of electric power, fuel and emission allowances related to these plants, as well as other contractual positions. Commercial Power’s generation asset fleet consists of Duke Energy Ohio’s non-regulated generation in Ohio, and the five Midwestern gas-fired, non-regulated generation assets. Commercial Power’s assets comprise approximately 7,550 megawatts of power generation primarily located in the Midwestern United States. The asset portfolio has a fuel mix with baseload and mid-merit, coal-fired units, as well as combined cycle and peaking natural gas-fired units. Most of the generation asset output in Ohio has been contracted through the rate stabilization plan (RSP), which expired on December 31, 2008. Effective January 1, 2009, Commercial Power began operating under an electric security plan (ESP), which expires on December 31, 2011. Commercial Power also develops and implements customized energy solutions.

Commercial Power, through Duke Energy Generation Services, Inc. and its affiliates (DEGS), is an onsite energy solutions and utility services provider. Primarily through joint ventures, DEGS engages in utility systems construction, operation and maintenance of utility facilities, as well as cogeneration. Cogeneration is the simultaneous production of two or more forms of usable energy from a single source. As of December 31, 2008, DEGS had approximately 370 net megawatts of wind energy in operation and over 5,000 megawatts of wind energy projects in the development pipeline.

International Energy

International Energy operates and manages power generation facilities and engages in sales and marketing of electric power and natural gas outside the United States. It conducts operations primarily through Duke Energy International, LLC (DEI) and its activities target power generation in Latin America. In addition, International Energy owns equity investments in National Methanol Company (NMC), located in Saudi Arabia, which is a regional producer of methanol and methyl tertiary butyl ether (MTBE) and Attiki Gas Supply S.A. (Attiki), located in Athens, Greece, which is a natural gas distributor. International Energy’s customers include retail distributors, electric utilities, independent power producers, marketers and industrial/commercial companies. International Energy owns, operates or has substantial interests in approximately 4,000 net megawatts of generation facilities.

Other

The remainder of Duke Energy’s operations is presented as Other. Other primarily includes Duke Energy’s approximate 50% ownership interest in Crescent, DukeNet and related telecom businesses and Bison Insurance Company Limited (Bison), Duke Energy’s wholly owned, captive insurance subsidiary. In addition, Other includes the remaining portion of Duke Energy’s business, formerly known as DENA, that was not exited or transferred to Commercial Power. Crescent develops and manages commercial, residential and multi-family real estate projects, and manages land holdings, primarily in the Southeastern and Southwestern United States. DukeNet develops, owns and operates a fiber optic communications network, primarily in the Carolinas, serving wireless, local and long-distance communications companies, Internet service providers and other businesses and organizations. Bison principally operates as a captive insurance entity, and includes the insurance and reinsurance of various business risks and losses of subsidiaries and affiliates of Duke Energy. On a limited basis, Bison also participates in reinsurance activities with certain third parties.