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Duke Power Company serves the Piedmont region of the two Carolinas, providing electricity to one of the Southeastern United States' most industrialized areas.
Our 20,000-square-mile service territory extends from Virginia to the Georgia border and includes a population of nearly 5 million people.
We serve more than 1.7 million electricity customers in this area, and are adding on average 40,000 new customers each year.
Duke offers very competitive electricity rates, significantly below the national average. In fact, while the prices on most other consumer goods have been rising, Duke's electric rates have declined over the past nine years.
Duke Power operates three nuclear stations, eight coal-fired stations and 38 hydroelectric stations. For the past two decades, our system of coal plants has been ranked as the most efficient in the United States by Electric Light & Power, an electric utility magazine. The three nuclear stations operated by Duke are consistently among the 10 most efficient multi-unit nuclear stations in the United States, according to data compiled by the U.S. Nuclear Regulatory Commission. Last year Duke's plants generated 86 billion kilowatt-hours of electricity and its 10 business units produced $4.5 billion in revenues.
The American electric utility industry is preparing to become more competitive, and Duke Power is no exception. In 1994 the company reorganized its operations, grouping its diversified businesses into the Associated Enterprises Group. This reorganization allows the diversified businesses of the AEG to develop different approaches to their business and market conditions, while enabling the traditional Duke Power electric operations to concentrate on the challenges and opportunities it faces.
Q. What is the relationship between Duke Power Co. and Duke University?A. Both Duke Power Co. in Charlotte, N.C. and Duke University in Durham, N.C. are named for James Buchanan Duke (1856- 1925), one of North Carolina's most prominent industrialists and philanthropists. A native of Durham, Duke made his fortune in the tobacco industry in the late 1800s. With his brother, Benjamin, J.B. Duke began investing in the fledgling power generation operations in the Carolinas around the turn of the century.
In 1904 Duke joined with Gill Wylie and William States Lee to form the Southern Power Co. in Charlotte. A South Carolina native, Wylie was practicing medicine in New York City when he treated Duke for an infected foot. Wylie had been backing Lee, an engineer, in several small hydroelectric projects supplying energy to the Carolinas textile industry. Wylie introduced Duke to Lee, who convinced Duke of the enormous economic potential in the electric power industry.
Southern Power Co. was formed to supply power to textile mills and other industrial users, but gradually acquired electric streetcar systems in Charlotte and other Carolinas towns, and began selling retail electricity to homes there as well. In 1913 Southern Power formed a subsidiary, Southern Public Utilities Co., to handle retail sales, including electric power for residential users. The two companies ultimately became Duke Power Co.
Shortly before his death, Duke created the Duke Endowment and funded it with $40 million in assets to assist educational institutions, hospitals, orphanages and the Methodist Church. Today the endowment's assets total more than $1.2 billion, and through past 70-plus years it has distributed more than $1.1 billion to its beneficiaries. The largest single benefactor of the endowment -- by far -- was Trinity College in Durham, which was renamed Duke University in 1925. Duke University currently gets over $20 million a year from the endowment. Other schools receiving annual grants from the endowment are Davidson College in Davidson, N.C., Furman University in Greenville, S.C. and Johnson C. Smith University in Charlotte.
For most of its history a majority of the endowment's assets were invested in Duke Power Co. stock, and the endowment was Duke Power's largest single shareholder. In 1994 the endowment sold 16 million of the 26 million shares of Duke stock it owned in order to diversify its investment. Today, it still owns about 5 percent of the outstanding stock in Duke Power Co.
Strictly speaking, Duke Power and Duke University share only a name. But more broadly, they share the common heritage of the philanthropy of their namesake. For most of this century, a significant portion of the profits from Duke Power Co. have flowed through the Duke Endowment to Duke University and the other beneficiaries.
For more on "Buck" Duke and the history of Duke Power and Duke University, see The Dukes of Durham by Robert F. Durden.
Q. I have a question about independent power providers selling excess electricity back to Duke Power. We are planning to install a solar array to generate electricity and would like to sell the excess electricity to Duke.
A. In order to sell electricity back to Duke Power you'll need some expensive equipment, including a metering system and a step-up transformer. Installing and maintaining this equipment can be quite costly, so it's justified only when the amount of energy to be transferred is a sizeable amount. Duke does purchase power from independent power producers, but these are usually large industrial customers who can supply considerably more electricity than the output from a typical residential solar array.
Q. Does Duke plan to buy XY and Z Company?
A. Duke can't comment specifically on any possible mergers or acquisitions. Many analysts expect a trend to develop toward consolidation in the North American electric utility industry, and some mergers and discussions have been announced in recent months. Duke's position is that we will investigate any merger or acquisition that would enhance shareholder value without a detrimental effect on customers.
Q. Does Duke have a specific strategy for acquisitions or mergers.
A. Based on the experiences of the telecommunications, trucking, airline and gas pipeline industries, we expect a significant restructuring to occur in the electric power business, resulting ultimately in disaggregation of investment and some consolidation. We are interested in increasing shareholder value through strategic acquisitions of some companies or discrete assets, and we've dedicated a lot of time and thought to that effort.
Q. Is Duke looking at electric distribution systems outside the United States?
A. Duke has made a strategic decision at this point not to invest in distribution facilities outside our service territory. We believe that the regulation of retail distribution is affected by political factors that would only be more difficult to deal with in areas where we aren't viewed as local citizens.
Q. If Duke isn't interested in distribution systems, what are you looking at.
A. Duke Power's strength has traditionally been in power generation, and that's what we're recognized for. We've purchased generating assets in Argentina, for example, where we've done a good job of lowering costs and increasing capacity factors in a highly competitive environment. Generation of power is what we do best and what we are most interested in. We also believe regulatory trends are toward less regulation and more competition on the generation side of the power business, but little change in regulation on the distribution side. Given those trends, we believe our strengths will allow us to do best by focusing any growth prospects on the generation side, while continuing to do a good job of serving our retail customers in our home service territory.
Q. How many gallons are in Lake Norman?
A. 356 billion gallons. Lake Norman is the largest fresh-water body of water in North Carolina. It has 520 miles of shoreline and a surface territory of 32,510 acres.
POWERON ...................................1-800-POWERON
(1-800-769-3766)
Business & Industry Customer Service.......1-800-653-5307
Merchandising (Collections)................1-800-473-8537
Appliance Repair Service...................1-800-755-3853
Telecommunications Device for the Deaf (TDD)
Direct.............................1-800-829-0062
Relay (NC customers)...............1-800-735-2962
Relay (SC customers)...............1-800-735-2905
Underground Cable Locator (NC).............1-800-632-4949
(SC).............1-800-922-0983
Energy Protection (Power Theft)............1-800-653-5305
Investor Relations
Toll-Free..........................1-800-488-3853
Charlotte.......................... 704-382-3853
FAX................................ 704-382-3814
In addition to these toll-free numbers, you can still reach customer service by using your local Duke Power number 24 hours a day.
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