Duke Energy Must Lead Utility Industry to Low-Carbon Future, Rogers Says

CHARLOTTE, N.C. - Duke Energy must play a key leadership role in reinventing the electric utility industry in 2008, the company’s chairman, president and CEO said today.

“Utilities must produce electricity that is clean, reliable and affordable – three critical but sometimes conflicting priorities that require a delicate balancing act,” Jim Rogers told about 200 shareholders at the company’s annual meeting.

“We face tough realities and difficult choices, but Duke Energy will be a leader in our industry and in our nation’s energy future,” he said.

While serious action on global warming is needed, the utility industry also must ensure that proposed federal climate change legislation does not bring unintended consequences or make electricity generation costs soar, resulting in rate shock for customers already facing skyrocketing food and gasoline prices, Rogers said.

Duke Energy and its fellow utilities must pivot toward a low-carbon future where energy efficiency, wind, solar, natural gas, nuclear and carbon-capture technology for coal plants take center stage, he said.

“The one thing everyone agrees on in the climate change debate is that we must fund an array of new energy technologies so we can fix this problem,” Rogers said. “A quick and meaningful way to do this is to place a small fee on every kilowatt-hour of electricity sold in the U.S.”

He called it “unacceptable” that both Europe and China annually outspend the U.S. on renewable energy research and development. “Our country is asleep when it comes to investment in renewable energy and energy efficiency. Our nation needs a sense of urgency.”

A three-tenths of a cent ‘technology fee’ on every kilowatt-hour of electricity sold in the U.S. would raise $11 billion annually for research and development, increasing the average residential customers’ power bill by about $3 a month, Rogers told reporters after the meeting. “If we put this in place now, it would raise $70 billion by 2015.”

Energy efficiency is critical to the nation’s future, requiring massive utility industry investment that dwarfs previous efficiency spending, he said, citing Duke Energy’s large-scale save-a-watt efficiency proposal currently awaiting action by state utility commissions in North Carolina, South Carolina and Indiana. “We want to make the communities we serve the most energy efficient in the world.”

In addition to hearing Rogers’ remarks, shareholders re-elected all 11 members of Duke Energy’s board of directors to one-year terms. The company has a declassified board, meaning that shareholders vote on all directors at each annual meeting.

Shareholders also ratified the selection of Deloitte & Touche as the company’s independent public accountant for 2008.