CEAC update Energy Efficiency | Renewables | Smart Grid

1. CEAC update Energy Efficiency | Renewables | Smart Grid November 19, 2010

2. Securing our energy future

3. State-of-the-Art Power SystemsEnergyWise®

4. Smart grid grant and initiatives • Launched EnergyWise® smart grid brand • Opened Smart Grid Program Office • Smart grid grant • DSDR • Condition-based monitoring • Smart meter pilot • Electric vehicle charging stations • EnergyWiseHomeSM

5. EnergyWise Home℠ • Helps Progress Energy manage the existing power supply during times of unusually high demand. Participants receive an annual bill credit • Over 42,890 customers enrolled in the program – 5,664 from the Western Region • $1 million incentives paid to date - $141,600 in the Western Region • Recently reached 51 MW in savings

6. Alternative Energy

7. Hot Springs Elementary Windmill

8. SunSense℠ Schools • Solar education program designed to give middle and high school students and faculty a unique, hands-on opportunity to learn more about solar energy • Five winning schools were chosen to receive a 2 kW solar PV system to be installed on their campus along with internet tracking equipment that shows the real-time energy output. • 2009 – 2010 SunSense School winners: • Daniels Middle School (Raleigh) • Jordan Matthews High School (Siler City) • Owen Middle School (Swannanoa) • South Brunswick High School (Southport) • South Florence High School (Florence)

9. Western Region Solar Projects • Recently reached 1 MW of installed solar PV in Western Region! • Evergreen Packaging: 55 KW system • Conrad Industries: 250 KW system • Jim Barkley Toyota: 75 KW system • Deltec Homes: 55 KW system • Biltmore Park Town Square Office Building: 80 KW system Evergreen Packaging Asheville, NC 55 KW system Conrad Industries Weaverville, NC 250 KW system Jim Barkley Toyota Asheville, NC 75 KW system

10. SunSense℠ Solar Water Heating Pilot • Offers a $1,000 incentive to program participants who invest in solar water heating and are accepted into our research study • Almost 100 customers approved to participate – 20 from the Western Region • 17 authorized installers throughout territory

11. SunSense℠ Solar PV program • Approved Nov. 15 • Expected to launch Jan. 1 • Provides upfront rebates of $1,000 per kilowatt of capacity • Monthly bill credits of $4.50 per kilowatt for newly installed solar • PEC retains rights to renewable energy credits • Participants must be PEC residential customers • Participants must own the installed solar PV system • Eligible systems must be sized from 2-10 kW

12. Energy Efficiency

13. What you can do:Energy efficiency www.savethewatts.com

14. Customized Home Energy Report • Gives homeowners a free, personalized evaluation of their energy usage and provides specific recommendations for energy and money savings • Over 17,495 customers have participated to date – 1,736 customers from the Western Region

15. Home Advantage • Encourages construction of ENERGY STAR®- certified homes that are at least 15% more energy efficient than standard homes and come with a 5% PGN discount • Over 802 homes built in 2010 – 96 in the Western Region • Official builders throughout service territory including site-built, system-built, manufactured and multi-family construction • 189 builders participating in program - 71 builders in the Western Region • $1.1 million in rebates paid to official builders - $152,600 in the Western Region

16. Home Energy Improvement Program • Offers rebates for energy-efficiency home improvements such as heating and cooling upgrades, duct repair and insulation • Total of 800 pre-qualifed contractors on the program – ~150 from the Western Region • Measures: • 55,493 installed since program launch • 2,992 installed in the Western Region • Rebates: • $7.3M since program inception in 2009 • $434,302 received in the Western Region • Savings: • KW – 9,609 since program inception • kWh  - 12,656,849 since program inception

17. Neighborhood Energy Saver • Provides information and free energy conservation measures to low-income residential customers to help reduce energy consumption and costs • Program Accomplishments: • Asheville, NC – 871 homes completed • Florence, SC – 785 homes completed • Marion, SC – 472 homes completed • Raleigh, NC – 1,300 homes completed • Projects in progress in Warren County and Goldsboro, NC • 3,470,720 kWh savings to date • 536 KW savings to date

18. Residential Lighting Program • Offers discounts to customers purchasing ENERGY STAR lighting products, including CFLs, at selected retail stores • 2.9 million bulbs sold to date – 760,000 in the Western Region • Over 446 retail stores participating • 88,802,023 KWH savings to date – 23,207,761 in the Western Region • 656,518 KW savings to date – 95,686 in the Western Region

19. Appliance Recycling Program • Launched April 5, 2010 • Offers a $50 incentive to retire older, inefficient refrigerators or freezers • Almost 95% of a refrigerator’s parts are recycled through this program • 3,873 appliances recycled to date – 465 in the Western Region • 4,336,248 kWh savings to date – 517,299 in the Western Region • 505 KW savings to date – 60 in the Western Region

20. Other items of interest • New website launch – Q1 2011 • Customer care / Lower my bill toolkit • Energy Neighbor Fund • Give Where You Live • Social media – staying in touch with our customers

21. Securing our energy future