Progress Energy CEO Says Company Focused on Securing the Energy Future

ORLANDO, Fla., Feb. 29 /PRNewswire-FirstCall/ -- Progress Energy is adapting well to an industry being shaped by the issue of climate change and the growing demand for energy and is taking steps to secure the energy future for its customers and company, Chairman, President and CEO Bill Johnson told financial analysts at a meeting in Florida today.

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"I am confident that Progress Energy has what it takes to succeed," Johnson said. "In recent years, we have clarified our strategic focus and transformed our business structure. Our Balanced Solution strategy has three parts: aggressive energy efficiency, innovative alternative energy and state- of-the-art power plants. And we're moving forward on all these fronts to secure our energy future."

The company's two electric utilities -- Progress Energy Florida and Progress Energy Carolinas -- serve 3.1 million customers. Johnson discussed with the financial analysts how Progress Energy is responding to the changing energy landscape facing the electric utility industry today.

"The overarching issue is how to address climate change and demand growth while maintaining a secure supply, reliable service and affordable rates for customers and creating shareholder value for investors," Johnson said. "We need to get the federal rules right on climate change, make the right adjustments to state regulatory compacts and make the right investment choices on utility infrastructure. I have confidence in Progress Energy's Balanced Solution resource strategy and our collaborative approach to public policy. We are confronting these new energy realities together with those who make the rules.

"Even with very aggressive energy efficiency and renewable energy development, our nation must build new power plants and expand its transmission system," Johnson said. "That is especially true in regions like ours that are seeing significant population growth and economic expansion. Where new baseload capacity is not needed until the middle of the next decade or later, then new nuclear is a viable option. In fact, given the prospect of carbon controls and the desire for energy security, new nuclear is the best option."

Johnson emphasized that the company is well positioned to enter an era of expansion and growth in its utilities. He noted that six U.S. companies, including Progress Energy, have already filed construction and operating license (COL) applications for new nuclear projects with the Nuclear Regulatory Commission. Up to 14 more applications are expected this year.

On Feb. 19, Progress Energy submitted a license application for two possible reactors at its existing Harris Nuclear Plant site near Raleigh, N.C.

The company plans to file its license application for its Levy County nuclear project in Florida sometime this summer, and is very close to filing the need case with the Florida Public Service Commission. Johnson added that, if the company gets timely approvals and decides to move forward with the project, it could have the first unit up and running at its Levy site as early as 2016.

Peter Scott, chief financial officer of Progress Energy, provided the analysts with a financial overview, and details regarding the company's financial objectives, projected capital expenditures and cash flow estimates.

"We are continuing to deliver on our strategy to generate solid earnings growth through our two utilities," Scott said. "Based on our business plan for 2008, we have set an ongoing earnings target of $3.05 per share, with a range of 10 cents above and below the target. We continue to expect to achieve our dividend payout goal of 80 percent by the end of this year, which will put us on track to achieve our long-term payout ratio goal of 70 percent to 75 percent."

John McArthur, general counsel and senior vice president of Corporate Relations for Progress Energy, provided the analysts with an overview of the regulatory strategy and landscape on the federal and state levels.

Jeff Lyash, president and CEO of Progress Energy Florida, provided a brief overview on the Levy County nuclear project.

The analyst meeting also featured guest speakers from outside of Progress Energy. Jim Smith, an economic forecaster, shared his perspective on the economic outlook in the nation and the Southeast. Ed Cummins with Westinghouse and Dave Berry with The Shaw Group provided a nuclear construction overview.

Johnson concluded the analyst meeting by reaffirming Progress Energy's commitment to delivering operational excellence and achieving its financial objectives. "And our Balanced Solution strategy puts us on the right path to meet demand growth in a carbon-constrained future," Johnson said.

Investors, media and the public were invited to listen to the live audio webcast of the presentation and download slide materials through the investor section of http://www.progress-energy.com/. A webcast replay of the event will be available by 8 p.m. Feb. 29 and will be archived for two weeks on the company's Web site.

Progress Energy, headquartered in Raleigh, N.C., is a Fortune 250 energy company with more than 21,000 megawatts of generation capacity and $9 billion in annual revenues. The company will observe its 100th anniversary in 2008. Progress Energy includes two major utilities that serve more than 3.1 million customers in the Carolinas and Florida. The company is the 2006 recipient of the Edison Electric Institute's Edison Award, the industry's highest honor, in recognition of its operational excellence. The company also is the first utility to receive the prestigious J.D. Power and Associates Founder's Award for customer service. Progress Energy serves two fast-growing areas of the country, and the company is pursuing a balanced strategy for a secure energy future. That balance includes aggressive energy efficiency programs, investments in renewable energy technologies and a state-of-the-art electricity system. For more information about Progress Energy, visit the company's Web site at http://www.progress-energy.com/.

Caution Regarding Forward-Looking Information:

This release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The matters discussed in this document involve estimates, projections, goals, forecasts, assumptions, risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed in the forward- looking statements.

Examples of factors that you should consider with respect to any forward- looking statements made throughout this document include, but are not limited to, the following: the impact of fluid and complex laws and regulations, including those relating to the environment and the Energy Policy Act of 2005; the anticipated future need for additional baseload generation and associated transmission facilities in our regulated service territories and the accompanying regulatory and financial risks; the financial resources and capital needed to comply with environmental laws and renewable energy portfolio standards and our ability to recover related eligible costs under cost-recovery clauses or base rates; our ability to meet current and future renewable energy requirements; the inherent risks associated with the operation of nuclear facilities, including environmental, health, regulatory and financial risks; the impact on our facilities and businesses from a terrorist attack; weather and drought conditions that directly influence the production, delivery and demand for electricity; recurring seasonal fluctuations in demand for electricity; the ability to recover in a timely manner, if at all, costs associated with future significant weather events through the regulatory process; economic fluctuations and the corresponding impact on our customers, including downturns in the housing and consumer credit markets; fluctuations in the price of energy commodities and purchased power and our ability to recover such costs through the regulatory process; the Progress Registrants' ability to control costs, including operations and maintenance (O&M) and large construction projects; the ability of our subsidiaries to pay upstream dividends or distributions to the Parent; the ability to successfully access capital markets on favorable terms; the impact that increases in leverage may have on each of the Progress Registrants; the Progress Registrants' ability to maintain their current credit ratings and the impact on the Progress Registrants' financial condition and ability to meet their cash and other financial obligations in the event their credit ratings are downgraded; our ability to fully utilize tax credits generated from the previous production and sale of qualifying synthetic fuels under Internal Revenue Code Section 29/45K (Section 29/45K); the investment performance of our pension and benefit plans; the outcome of any ongoing or future litigation or similar disputes and the impact of any such outcome or related settlements; and unanticipated changes in operating expenses and capital expenditures. Many of these risks similarly impact our nonreporting subsidiaries. These and other risk factors are detailed from time to time in our filings with the United States Securities and Exchange Commission (SEC). All such factors are difficult to predict, contain uncertainties that may materially affect actual results and may be beyond our control. New factors emerge from time to time, and it is not possible for management to predict all such factors, nor can it assess the effect of each such factor on us. Any forward-looking statement is based on information current as of the date of this document and speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made.