Plug-in Hybrid Electric Vehicle Impact Study for the Progress Energy Carolinas Territory

1. Plug-in Hybrid Electric Vehicle Impact Study for the Progress Energy Carolinas Territory Mike Waters November 2, 2007

2. Agenda • Utility Background • Market Model Results • Impact on Progress Energy • Load Curves • Generation Mix • Cost • Emissions • Summary

3. Utility Background

4. Progress Energy Territory • Fortune 250 Energy Company • Headquarters in Raleigh, NC • Serves 3.1 million customers in FL and NC/SC

5. Progress Energy Territory • 21,000 MW total generation capacity • 36 sites through the Carolinas, FL, and GA

6. Market Model Results

7. Sales percentage of PHEVs achieves ~26% by 2030, resulting in 330k vehicles on the road

8. Impact on Progress Energy

9. Three different charging scenarios were evaluated for the incremental load • Investigated three charging scenarios • Uncontrolled • Delayed (after 10 PM) • Off-peak optimization • Assumptions: • Similar to NREL Xcel study • PHEV20: Performance modeled from ADVISOR • Fleet average 5.3 kWh/day providing 40% miles • 120V 20A circuit (charging rate ~ 1.4 kW) • 5% T&D loss

10. Case 1: Uncontrolled charging results in on-peak demand

11. Case 2: Delayed charging helps push the demand later into the shoulder peak region

12. Case 3: Optimized off-peak charging is the most ideal case in terms of cost and timing

13. As greater control is placed on managing the load timing, the percentage of coal/nuclear increases

14. Focusing PHEV load off-peak reduces incremental generation costs up to 60%

15. Wholesale electricity cost in “gasoline equivalent” terms ranges from $0.44 to $1.16 per gallon

16. Rates are considerably cheaper than gas in all cases, but incremental profit depends on rate scheduling Standard Residential Rate ~ 9 cents/kWh Profit Loss! TOU Rate ~ 4.5 cents/kWh * Based on 670 GWh/329k vehicles

17. Charging technology must advance between different charging scenarios

18. Despite increase in coal mix, SO2 and NOx emission rates decrease while CO2 increases slightly off-peak

19. Net PHEV SO2 emissions are much greater, although cap system will ensure no new emissions overall

20. Net PHEV NOx emissions are equal to or slightly greater than a standard hybrid Note: NREL/Xcel study assumed no reduction in HEV tailpipe emissions, estimating total HEV rate at 4.6 and providing a more favorable PHEV comparison. This study assumes HEV reduction due to improved mileage.

21. Net PHEV CO2 emissions are slightly lower than a standard hybrid in all cases

22. Summary

23. Result Summary • Incremental load <1% of capacity • No additional capacity required if delayed/off-peak • Effective fuel costs much less than gasoline • Coal use doubles moving towards off-peak • NOx/SOx emissions decrease while CO2 increases moving towards off-peak optimization • Mixed results for vehicle emission comparison • Must take cap system into account • CO2 reduced for all comparisons

24. Recommendation Summary • PHEV technology is a viable and preferred technology alternative • Engage in active promotion of technology and adoption • Develop internal, cross-functional teams • Develop external network/alliance • Provide customer incentives • Push for legislation • Education (customers and employees) • Tie to reduced carbon technology

25. Questions?

26. Appendix

27. Charging Rates