Sustainability Plan & Approach

Duke Energy Sustainability Plan and Progress at a Glance

This sustainability plan reflects Duke Energy’s commitment to operate in a way that is good for people, the planet and profits. It expands on the company’s business strategy and values. We will update our sustainability plan and goals after the merger with Progress Energy.

Progress Keys:
Green arrowAchieved or on track
Yellow arrowCurrently not on track
Red arrowGoal not achieved

Innovative Products and Services

Provide innovative products and services in a carbon-constrained, competitive world.

Why it matters: Our customers want products and services that keep them competitive, yet respond to environmental concerns.

Corporate Sustainability Goals
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Energy Efficiency: Reduce customer energy consumption by 2,500 gigawatt-hours (GWh) and peak demand by 2,100 megawatts (MW) by 2013.
2011 Status:
Green arrow
As of year-end 2011, energy consumption was reduced by 1,963 GWh.
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As of year-end 2011, peak demand was reduced by 1,409 MW. Current forecasts indicate that this goal will be achieved by 2014, not 2013 as originally anticipated.
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Renewables: Scale up to 3,000 MW of wind, solar and biomass by 2020.
2011 Status: We added 60 MW of wind and solar energy in 2011, ending the year with 1,070 MW in service. We plan to complete five additional wind farms in 2012.
Affordable Energy: Maintain rates lower than the national average.
2011 Status:
Green arrow
Duke Energy’s regulated average retail rates in North Carolina, South Carolina, Indiana and Kentucky were significantly lower than the U.S. average.
Red arrow
Due to the economic downturn and drop in wholesale prices, our regulated average retail rate in Ohio, which was set in 2008 through the end of 2011, was above the national average. For information on how we addressed this issue, see “Reaching agreement on affordable rates” in the Innovative Products and Services section of this report.
Reliable Energy: Maintain the high reliability of our generation system.
2011 Status:
Green arrow
Nuclear capacity factor approximately 93.0 percent versus a target of 92.8 percent.
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Regulated fossil commercial availability was approximately 87.8 percent versus a target of 89.2 percent.
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Nonregulated fossil commercial availability and wind energy yield combined was approximately 88.9 percent versus a target of 86.2 percent.
Reliable Energy: Maintain the high reliability of our distribution system.
2011 Status: Though we have improved reliability substantially in recent years, we did not meet our aggressive 2011 goals due to large numbers of storms.
Red arrow
Average number of outages* was 1.18 versus a target of 1.07.
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Average outage duration* was 157 minutes versus a target of 138 minutes.
* Outages longer than 5 minutes; statistics are reported per customer.

Environmental Footprint

Reduce our environmental footprint.

Why it matters: As an energy company, we have a large impact on the environment and depend on natural resources for our fuel.

Corporate Sustainability Goals
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Carbon Emissions: Reduce or offset the carbon dioxide (CO2) emissions from our U.S. generation fleet 17 percent from 2005 by 2020 (i.e., go from 105 million tons in 2005 to 87 million tons in 2020).
2011 Status: Our U.S. generation fleet emitted about 91 million tons of CO2 — down from almost 98 million tons in 2010. This reduction was due to decreased generation resulting from lower electricity demand, decreased coal generation and increased natural gas generation. Current forecasts indicate higher electricity demand and other factors will cause our emissions to exceed the 2020 goal. New nuclear generation capacity, if completed in the 2021-2023 time frame as currently forecasted, will help reduce these emissions.
Yellow arrow
Carbon Intensity: Reduce the carbon intensity (tons of CO2 emitted per net megawatt-hour of electricity produced) of our total generation fleet from 0.63 in 2005 to 0.50 by 2020.
2011 Status: Total generation fleet carbon intensity decreased — from 0.60 in 2010 to 0.58 in 2011 — due to the same factors mentioned above. While our annual carbon intensity levels fluctuate from year to year, we anticipate a continued downward trajectory from the 2005 baseline. However, our most recent forecast indicates that our carbon intensity will slightly exceed the 2020 goal.
Green arrow
Waste: Increase the percentage of solid waste that is recycled from 52 percent in 2008 to 62 percent by 2012. (This goal excludes Duke Energy International and Duke Energy Generation Services.)
2011 Status: We recycled almost 28,000 tons of materials, or about 64 percent of the total waste stream. Having already achieved our goal, we plan to further improve our recycling performance in 2012.

Quality Workforce

Attract, develop and retain a diverse, high-quality workforce.

Why it matters: Energy companies will be differentiated by the quality, creativity and customer focus of their employees.

Corporate Sustainability Goals
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Safety:
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Achieve zero work-related fatalities.
2011 Status: There were no contractor or employee work-related fatalities in 2011. We attribute this success to the continued safety focus of employees, contractors and management.
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Achieve top-decile safety performance in employee Total Incident Case Rate (TICR) by 2012.
2011 Status: We improved TICR to 0.86, from 0.9 in 2010. Employee TICR has improved 43 percent since 2006. We are on track to be in the top decile of our industry peers in 2012.
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Employee Engagement: Maintain management and employee engagement at 75 percent and 64 percent, respectively, or higher, as measured by favorable scores on survey questions.
2011 Status: Management and employee engagement were 84.9 and 73.7 percent, respectively.

Strong Communities

Help build strong communities.

Why it matters: Our success is linked to the health and prosperity of the communities we serve.

Corporate Sustainability Goals
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Philanthropy: Continue to track the number of lives positively impacted by our support of key community partners.
2011 Status: We continued to measure the impacts of our philanthropy on communities. We evaluated 12 of our largest 2010 grants, totaling just over $3 million. By engaging with our key community partners, we learned that those grants had a positive impact on more than 820,000 lives. Some of the grants had an impact in 2011, while others were for projects, such as building construction, that will have impacts in later years (not included in the results).

Governance and Transparency

Be profitable and demonstrate strong governance and transparency.

Why it matters: Creating shareholder value and earning the trust and confidence of our many stakeholders keeps us in business.

Corporate Sustainability Goals
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Shareholder Return: Outperform our peers in total shareholder return (TSR) annually and over a three- year period, as measured by the Philadelphia Utility Index.
2011 Status: Our TSR was 30.3 percent for 2011, exceeding our peers as measured by the Philadelphia Utility Index. TSR for the index was 19.3 percent in 2011. Duke Energy has achieved a cumulative three-year TSR of 74.1, while the industry’s TSR was 38.7 percent.