progress energy 08

Bill JohnsonChairman President and CEOChairman, President and CEO

EEI Financial ConferencePhoenix, AZ

November 11 2008November 11, 2008

Caution Regarding F d L ki St t tForward-Looking StatementsThis presentation includes information that is forward-looking in nature. Many factors could cause the actual results to be materially different than the forward-looking information provided. These factors are discussed in more detail in the Company’s most recent p y10-K and 10-Q forms.

M j Di i T iMajor Discussion TopicsStrategic AgendaSt ateg c ge da

Financial Overview

Balanced Strategy for Growth

Regulation and Public PolicyRegulation and Public Policy

Profile of who we are:T Hi h P f i El t i Utiliti

Progress Energy Carolinas

Two High-Performing Electric UtilitiesNorth Carolina

• 12,400 MW capacity• Over 1.4M customers• 2.2% cust. growth (7-yr CGR)• $4.4B total revenue• $12B total assets• $12B total assets• 5,000 employees• 34,000 sq. mile service area• 18 plants, 82 units

South Carolina

• 9,400 MW capacity• ~1.7M customers

2 2% t th (7 CGR)

Progress Energy Florida

Florida• 2.2% cust. growth (7-yr CGR)• $4.7B total revenue• $13B total assets• 4,000 employees• 20,000 sq. mile service areaService Area , q• 14 plants, 65 units

Service Area

Core Strategic Foc sCore Strategic Focus

Progress Energy Carolinas

PGNPGN● Achieve financial objectives

while excelling in fundamentals

Ad t t l dProgress Energy Florida

PGNPGN ● Adapt to new energy landscape

● Leverage prospects for growth

Integrated Energy Service Company Serving the Carolinas and FloridaServing the Carolinas and Florida

Power Transmission

Power Generation

Power Delivery

Customer Servicey

St t i A dStrategic AgendaAchieve long-term annual EPS growth of 4-5%g g

Excel in the fundamentals

Pursue Balanced Solution to secure energy future

Confront new energy realities together with gy gregulators, policymakers and customers

Sustain financial strength and flexibility during g y gnuclear construction

C iti l S F tCritical Success Factors

Safety & Operational Excellence

Financial


Financial

STRONGERFUTUREFor Customers,

Employee Engagement &

Financial Objectives

A Balanced Solution Strategy





Financial Objectives ,

Shareholders and Employees

Performance

Constructive

Customer Satisfaction

Strategy for Growth

,Shareholders and Employees

Performance

Constructive


Strategy for Growth

Objectives

Constructive Regulation & Public Policy


L T Fi i l Obj tiLong-Term Financial ObjectivesAchieve our 4-5% EPS growth objectiveg j

Preserve an investment grade credit rating

Maintain dividend growth

Keep rate increases reasonable to customersp

Fund Levy and capital investments in the rest of the business

2008 O i E i G id2008 Ongoing Earnings Guidance$2.95 - $3.05 per share$ 95 $3 05 pe s a e

$2.91 trailing 12-month ongoing EPS

4Q-07 actual EPS of $0.40 included:♦2¢ unfavorable weather¢♦13¢ regulatory depreciation / amortization

(Harris, CSA and GridSouth)

St Li idit P iti *Strong Liquidity Position*$ in millions

Program Term Amount Expiration

PGN Revolving Credit Facilities Debt Maturity Profile

Issuer 2009 2010 2011 2012Program Term Amount Expiration

PGN 5 Years $ 1,130 5/3/12

PEC 5 Years 450 6/28/11

Issuer 2009 2010 2011 2012

PGN $ – $ 100 $ 700 $ 450

PEC 400 6 – 500

PEF 5 Years 450 3/28/11

$ 2,030

PEF – 300 300 –

Total $ 400 $ 406 $1,000 $ 950

* As of September 30, 2008.



Financial





Employee Engagement & ,


Performance

Constructive


Strategy for Growth

g gPerformance




Financial




A Balanced Solution Strategy A Balanced SolutionStrategy for Growth ,


Performance

Constructive


Strategy for GrowthStrategy for Growth


PGN Balanced Solution StrategyPGN Balanced Solution Strategy

E Effi i d Alt ti EEnergy Efficiency and Alternative Energy

Energy Efficiency and DSM Alternative Energy• NCUC approved four new programs

– EnergyWiseResidential Home Advantage

• North Carolina solar– 1 MW on former landfill in

Haywood County– Residential Home Advantage– CIG New Construction– CIG Retrofit-Custom

• NCUC reviewing Distribution System

Haywood County– 1.2 MW at our Sutton Plant near

Wilmington– 1 MW at SAS in Cary

• NCUC reviewing Distribution System Demand-Response (DSDR)

– Invest $260M by 2012– Reduce peak demand by 250 MW

• Plug-in hybrid electric vehicle partnership with NC State University

• Florida PPAs• NCUC hearing on rider scheduled for

December 17-18, 2008

• Florida PPAs– 40 MW biomass– 60 MW municipal solid waste

Note: CIG = Commercial, Industrial, and Government.

Significant Rate Base GrowthE P i t N N l

Progress Energy Florida²Progress Energy Carolinas¹

Even Prior to New Nuclear

$9,000$9,000

2008-2010E CAGR

5%

g gyg gy2008-2010E

CAGR

18%

$6,000

$7,000

$8,000

$ ,

$6,000

$7,000

$8,000

$9,000

1M)

2001-2007 CAGR5.0%

2001-2007 CAGR4 1%1M

)$3,000

$4,000

$5,000

$3,000

$4,000

$5,000

,

Rat

e B

ase

(x 4.1%

Rat

e B

ase

(x

$0

$1,000

$2,000

$0

$1,000

$2,000

Ret

ail R

Ret

ail R

2001 2002 2003 2004 2005 2006 2007 2008E 2009E 2010E2001 2002 2003 2004 2005 2006 2007 2008E 2009E 2010E

Retail rate base Clause-related

1. PEC rate base includes Clean Smokestacks Act expenditures in excess of $584M.2. PEF rate base excludes Levy County nuclear capital expenditures.

CapEx Driving Earnings Growth – On Track

Total Project Cumulative Spent ExpectedMajor Generation Projects

jCapEx

pthrough 9/30/08

pCompletion Date

CarolinasClean Smokestacks $1.5-1.6B $ 986M 2013

Wayne County CT 90M 17M June 2009Richmond County CCGT (incl Transmission) 600M 45M June 2011

FloridaEnvironmental $ 1.2B $ 745M May 2010Bartow Repowering 690M 602M June 2009p g(incl Transmission) 690M 602M June 2009

CR3 Nuclear Uprate 365M 73M Dec. 2011CR3 Steam Generator Replacement 245M 110M Dec. 2009Replacement

Note: Total project capital expenditures based on current estimates and exclude AFUDC.

L N l P j t i Fl idLevy Nuclear Project in FloridaLocation Technology # of units Capacity (MW) In Service

Levy County, Florida

Westinghouse AP1000 2 ~2,200 total Unit 1: 2016

Unit 2: 2017

● 8 miles NE of our Crystal River● 8 miles NE of our Crystal River Energy Complex

● Negotiating joint ownership with multiple parties (1)

● Negotiating engineering, procurement & construction (EPC) agreement with Westinghouse and ShawWestinghouse and Shaw

● Site prep and pre-construction begin ~2010/11; safety-related construction begins 2012/13g

(1) Confidentiality obligations preclude us from discussing this further until the negotiations are completed.



Financial





Constructive Regulation & ,


Performance

Constructive


Strategy for GrowthPublic Policy


R l t U d tRegulatory UpdateCarolinas♦ Clean Smokestacks amortization♦ Harris depreciation♦ Proposed fuel settlement in North Carolina♦ Proposed fuel settlement in North Carolina

Florida♦ Cost recovery includes the following clauses:

– Levy Nuclear– CR3 Uprate

– Fuel

Approved on Oct. 14, 2008

– Capacity– Environmental– Energy Conservation

Hearings held Nov. 4-6, 2008

♦ Rates effective January 1, 2009

Supportive Florida Legislation 2006:N l I t t RNuclear Investment Recovery

Pre-construction and licensing♦ Capacity cost recovery clause (CCRC)♦ Costs are recovered dollar for dollar

During constructionDuring construction♦ AFUDC is recovered through CCRC♦ 8.848% AFUDC rate is locked until commercial operation♦ Annual prudence reviews

Completion♦ Base rate adjustment at in-service for capital costs♦ Base rate adjustment at in-service for capital costs♦ ROE and capital structure based on last approved

(currently 11.75% ROE on 57.83% common equity)

P j t ll ti tProject cancellation cost recovery

Conclusion

N T Fi i l O tl kNear-Term Financial OutlookMaintain strong liquidity positiona ta st o g qu d ty pos t o

On track to achieve 2008 ongoing earnings guidance of $2 95 $3 05 per shareguidance of $2.95 - $3.05 per share

L T Fi i l Obj tiLong-Term Financial ObjectivesAchieve our 4-5% EPS growth objectivec e e ou 5% S g o t object e

Preserve an investment grade credit rating

Maintain dividend growth

Keep rate increases reasonable to customersKeep rate increases reasonable to customers

Fund Levy and capital investments in the rest f th b iof the business

Appendix

C dit F iliti C ti *Credit Facilities Consortium*Bank Total

$ in millions

Bank TotalJ.P. Morgan Chase $ 225.0

Bank Tokyo-Mitsubishi 200.0

Barclays Capital 190.5

Bank of America 190 0Bank of America 190.0

Citigroup 180.0

Wachovia 175.5

Royal Bank of Scotland 169.0

Bank of New York Mellon 120 0Bank of New York Mellon 120.0

SunTrust 115.0

Morgan Stanley 100.0

Goldman Sachs 100.0

D t h B k 95 0Deutsche Bank 95.0

UBS 80.0

BNP Paribas 50.0

BB&T 25.0

*As of September 30, 2008.

First Tennessee 15.0

Total $ 2,030.0

C t C dit R ti *Current Credit Ratings*Moody’s Investors Standard Fitch

Services & Poor’s RatingsProgress Energy

Outlook Stable Stable StableCorporate Credit Rating -- BBB+ BBBSenior Unsecured Debt Baa2 BBB BBBC i l P P 2 A 2 F 2Commercial Paper P-2 A-2 F-2

Progress Energy CarolinasCorporate Credit Rating A3 BBB+ A-Commercial Paper P-2 A-2 F-1Senior Secured Debt A2 A- A+S i U d D bt A3 BBB+ ASenior Unsecured Debt A3 BBB+ APreferred Stock Baa2 BBB- A-

Progress Energy FloridaCorporate Credit Rating A3 BBB+ A-Commercial Paper P-2 A-2 F-1Senior Secured Debt A2 A A+Senior Secured Debt A2 A- A+Senior Unsecured Debt A3 BBB+ APreferred Stock Baa2 BBB- A-

FPC Capital IPreferred Stock** Baa2 BBB- --

Progress Capital HoldingsProgress Capital HoldingsSenior Unsecured Debt*** Baa1 BBB --

* As of November 5, 2008.** Guaranteed by Progress Energy, Inc. and Florida Progress Corporation.

*** Guaranteed by Florida Progress Corporation.

progress energy 08

Economy & Finance