Text

Interim Financial Statements,Second Quarter 1972.
	ML19316A454
Person / Time
Site:	Oconee
Issue date:	09/15/1972
From:	; DUKE POWER CO.
To:	;
References
	NUDOCS 7912110765
	Download: ML19316A454 (41)
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,i INTERIM FINANCIAL STATEMENTS SECOND QUAilTER ;

1972 I

r I OUKE POWER

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t i DUKE POWER COMPANY 822 South Church Street - P. O. Box 2178 Charlotte, N. C. 28201 Telephone: 704 374-4574 These Financial Statements are intended to provide information to present shareholders about the Con:pany and its operations. They are not a representation with respect to any securities of the Company, nor are they to be used in connection with any sale or purchase of any securities.

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. , DUKE POWER COMPANY j BALANCE SHEET (Subject To Audit)

(Thousands or Dollars)

June 30 .

, ASSETS 1972 1971 Electric Plant (at original cost): ' N i Electric plant in service . . . . . . . . . . . . . . . . . . . ......... . 51,942,224 51,730,539

.i Construction work in progress (1972. includes $396,639 of nuclear -

and 5178,278 of other generating facilities). . . ... . 694.036 514.908 Tota! . . . . . . . . .. . ..... . . .... . 2,636,260 2,245,447 Less accumulated depreciation . ... . .. . ... . . 558,114 511.098 .

Electric plant, net (excluding nuclear fuei assemblies) . . ... 2,078,146 1,734,349 Nuclear fuel assemblies . .. . .... . . . ..... . 54.028 14.970 Electric plant, net ... .. . .... 2,132,174 1.749.319 Other Property and investments:

Other property . at cost (less accumulated depreciation) . . . ... . 14,689 14,369 investments in and advances to subsidiaries - at equity . .. 19,213 27,093 Other securities . at cost or less . .. . . . . 7,331 2.089 Total other property and investments . . ... . . 41,233 43.551 Current Assets:

Cash .......... . .. .. . ...... 14,787 14,629 Receivables (less allowance for losses). . . . 40,064 34,824 Materials and supplies . at average cost:

Fuel . . .. . . . .. .. . .. . . 35,659 36,006 Other. .. .. . .. . ..... 32,768 30,605 Prepayments . . . ..... ... . . .. .. 256 429 Total current assets . ... . .. .... . . 123.534 116,493 Deferred Debits:

Debt discount, premium and expense, being amortized . . . . . . . . 5,520 3,915 Other. . .. .. ..... . .. . .. . ... ... 4,877 4.684 Total deferred debits .. ... ....... ... 10.397 8.599 Total . . . ...... ... . .. .... ... .. 52.307.338 51.917.962 LIABILITIES ,

Lapitalization:

Capital stock and retained camings:

)

Common s:.)ck, no par (authorized 50,000,000 shares; outstanding 1972 35,311,153 shares) . . . .... .. . .... .. S 613,851 5 496,392 Retained earnings. ........ . .... . ... . .... .. 83.627 73.M 7 Total common stock equity . .. .. ... . . ... . 697,478 569,439 Preference stock . 5100 par (authorized 1,500,000 shares; outstanding 500,000 shares . 6 3/4"o Coavertible Series AA). . .... ..... 50,000 50,000 Preferred stock . S 100 par (authorized 5,000,000 shares):

4.507c Series C (outstanding . 350,000 shares) . . . ...... ... 35,000 35,000 5.72% Series D (outstanding . 350,000 shares). . . . . ...... 35,000 35.000 6.72"o Series E (outstanding . 350,000 shares) . . .... . . 35.000 35,000 8.707 Series F (outstanding - 600,000 shares) . . . ... ..... 60,000 60,000 8.20% Series G (outstanding . 600,000 shares) . . ....... 60,000 -

7.80% Series H (outstanding . 600,000 shares) . . .. .. .... 60,000 -

Premium on preferred stock . 7.807c Series H. , . . . . .. ..... 937 -

Total capital stock and retained earnings . . ... ...... 1,033,415 784.439 Long. term debt (Note 5) ..... . .. . ......... .. 1.144.S95 938.487 Total capitalization . . . .. .... .... ........ 2.178.310 1.722.926 Current Liabilities:

Accounts payable. . . . ... ... .. ....... 26,155 20,425 Customers' deposits . , . . .. .. ... ... . . .... .... . 2,497 2,859 Taxes accrued . . ... . .... .... ... .. ... . .. . 9,370 5,480 .

Interest accrued. ... . ... .. . .. ..... . .. .. 23,319 21,048 Other. ... .. .. ... . . . .. ... .... .... 3,729 4.453 Total . . . . . .. ....... ....... ... .... ... 65,070 54.265 Notes payable for construction . pending permanent financing . ..... 24,100 111.723 Total current liabilities . . . . .. ........ . . 89,170 165.988 Deferred Credits etc. .

Investment tax credit, being amortized. ....... ... . . . 12,0S0 12.457 Injuries and damages reserve . ........ ....... . ... 2,324 2.303 Contributions in aid of construction . .......... .. . ..... 9,645 7,955 Accumulated deferred income taxes . . ... .... . ..... 14,659 5,157 Other deferred credits . .... . ... . .. . .. .. . . I,150 1,176 Total deferred credits, etc. . .. .... ....... 39.858 29.N8 Total . . . . . .............. ... .. ....... 52.307.338 S t .917.962 See notes to funenedet sterements.

DUKE POWER COMPANY

. STATE 31ENT 01 INCOslE (Subjec: E .tudits (Thousands of Dollars)

Three Months Ended Six Months Ended Twelve Months Ended June 30 June 30 June 30 1972 1971 1972 1971 1972 1971 Electric Revenues (Note 1) . , S120,799 $ 106.547 $243,242 $216.813 $477.970 5419,777 Electric Expenses:

Operation:

Fuel used in electric generation . . . 38.415 39,183 80,781 80,589 161,280 161,752 Purchased power 7,264 4,079 12,587 7,273 23,824 17,138 Wages and benefits, materials, etc. 16,582 14,440 33,331 28.9 % 63.800 52,734 Maintenance . . 6,215 5,356 12,175 10,821 23,559 20,730 Depreciation 14,111 12,573 29,544 25,786 56.820 50,623 Taxes: (Note 3)

General ... .. I1,009 9,976 21,592 19,938 40,880 37,755 Federalincome . 2,392 705 2,248 1,665 9.372 2,725 State income . 531 (355) 852 713 1,989 1,514 Provision for deferred income taxes. . 2,781 1,839 6,047 3,345 9,502 4.327 investment tax credit:

Tax credit deferred . 1,205 1,217 3,337 2.372 3,728 3,510 Amortization (credit) . . (1,102) (1,217) (2.237) (2,388) (4.032) (4.327)

Total electric expenses . . 99.403 87,796 200.257 179,020 390.722 348,486 Electric operating income . 21,396 18.751 42,985 37.793 87,248 1.291 Otlwr income:

Allowance for funds used during construction. 12,772 8,628 24,696 17,090 45,282 30,635 Earnings of subsidiaries . . 353 431 540 010 2,354 1,904 Dividends and interest . . . 136 78 273 114 889 180 Other, net (Note 4) .

(183) 2,248 (479) 1,935 (603) 2,057 Income tax-credit . .. . . 3,280 1,257 6.295 3.986 11,862 8,972 Total other income . 16.358 12,642 31.325 23,735 59,784 43.748 Gross income . . 37,754 31,393 74.310 61,528 147,032 115.039 Interest Deductions:

Interest on long. term debt .. 17,178 14,050 32,978 26,496 61,393 49,852 Other interest . . .. 726 842 2,132 2,953 6,531 7,521 Amortization of debt discount, premium and expense .. . . . 64 34 128 65 195 123 Total interest deductions . 17,968 14.926 35.238 29,514 68,119 57.496 Net income . . .... . 19,786 16,467 39,072 32,014 78,913 57,543 Dividends on P:eference and Preferred Stock. .. 4.978 3.631 9.839 7.262 18,919 13.787 Earnings for common stock . . . . . S 14,S08 5 12.836 5 29.233 5 24.752 5 59,994 S 43.756 Average Common Shares Outstanding (thousands) 35,288 30,128 33,745 28,777 31,966 27,313 Per Share of Common Stock:

larnings for common stock . ... 50.42 $0.43 50.86 S0.86 $1.88 51.60 Dividends paid. . . .. . . . %.35 $0.35 $0.70 50.70 $ 1.40 S1.40 R See notes to financialstatements. _

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DUKE POWER CO.\lPANY STATESlENT OF SOURCE OF FUNDS FOR PLANT CONSTRUCTION EXPENDITURES SIX SiONTils ENDED JUNE 30,1972 (Subject To Audits (Thousands of Douars)

SOURCE OF FUNDS:

Funds from operations-Net income. . . .. . . . . . . . . . .. . S 39,072 Non-cash charges:

Depreciation and amortization . .. . .. ... . . 30,126 Other, net . ... . . . . . . . 8.598 Funds from operations . .... . . . . . 77,796 Dividends on common stock . .. . ... . . . .. . (22.941)

Dividends on preference and meferred stock . . . .. (9,839)

Furds retained . . the business . .... . . . 45.016 Financing-Common stock (5,081,690 sharcs) .... . . .. I11,970 First mortgage bonds . 7 3/4?o Series due 2002 . . . . .. 99,565 Preferred stock . 7.80"o Series li . ... . . .. .. 60,127 Promissory notes - nuclear fue! . ... .. . . . . . . 1,000 Decrease in notes payable . . . . . . . (95.243)

Funds fram fimancing . . .. . . . . 177.419 Total avui:.' ' f'mds. ..... .. . . .. .. 222,435 Changes in working capital, etc.-

Inventories . . .... .. . ... . . . . .. (9,017)

Investments in and advances to subsidiaries. .... ..... .. 15,368 Other. . . . . . ...... . . . . . . 6.834 Plant construction expenditures . . . .

. 5235,620 SU1151 ARY OF PLANT CONSTRUCTION EXPENDITURES:

Electric production . . .... . . ..... . 5149,366 14,265 Nuclear fuel. . . . . .. ....... . . . .. .... . ..

Electric transmission. .. . . . 35,411 Electric distribution . . . . . . .... .. . . . .. . 33,246 4,354 Electrie general . . . . .. .. .. . . . ......

Other construction, net of salvage . . ... . .. .. . . (1,022)

Total plant construction expenditures . . . . . ... . 5235.620 STATE 31ENT OF RETAINED EARNINGS SIX SiON'111S ENDED JUNE 30,1972 (Subject To Audit)

(Thousands of Dollars:

Balance, December 31,1971... .. ... . ... 5 81,818 Add:

Net income for the period . . . . .. .. .. . .. 39.072 Total . . . ............. ... ........... 120,890 Deduct:

Cash dividends on preference and preferred stock. . . ... 5 9.839 Cash dividends on common stock . . .. . . . ... 22,94I Capital stock expense .. . ... . ... 4.483 37.263 Balance. June 30,1972.. .. ... . . .. ..... . 5 83.627 See notes to financial statements.

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HIGHLIGHTS c'o Six Months Ended June 30 1971 Increase increase 1972_

Kilowatthour Sales (thousands):

19,026,831 18.153,213 873,618 4.8 Total * .

18,967,260 17,668,549 1,298,711 7.4 Regular Sales Electric Revenues:

$243,242,000 $216,813,000 $26,429,000 12.2 Total * .

5239,387,000 $210,177,000 529,210,000 13.9 Regular Sales S 91,505,000 5 81,501,000 $10,004,000 12.3 Residentirl .

Commercial . .

S 49,2 %.000 5 41,908,000 $ 7,428,000 17.7 Industrial . S 75,L6,000 $ 65,402,000 5 9,964,000 15.2 Earnings for Common Stock . S 29,233,000 $ 24,752,000 S 4,481,000 18.1 Per Share of Common Stock:

Earnings . S 0.86 S 0.85 - -

Dividends paid. S 0.70 $ 0.70 - -

Plant Construction Expenditures. 5235,620,000 $208,644,000 $26,976,000 12.9 1,024,620 935,938 38,682 3.9 Customers .

Includes Interchange, Etc.

Peak Load (calendar year):

- 1972 1971 Summer -KW . .

6,440.335 6,622,125

-Date June 6 June 28 Winter -KW. 6,723,085 6,459,790

-Date ..

January 17 December 3 The 1972 summer peak load, to date, of 7,448,000 KW occurred on July 24,1972.

OFFICER'S CERTIFICATE I hereby certify that the accompanying tinancial statements were prepared under my control and direction and that, in my opinion, such tinancial statements present fairly the financial position of Duke Power Company as of the respective dates shown and the results of its operations for the respective periocs then ended,in conformity with generally accepted accounting principles applied on a consistent basis.

R. E. Frazer Vice President, Finance July 26,1972

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NOTES TO FINANCIAL STATDIENTS 1 -In 19701972 the Company filed applications for rate increases with the regulatory commissions that have authority over its rates to wholesale and retail customers. The following tabulation sets forth the effects on revenues of .

rate increases granted to date:

lit..nated Revenue increases i thousandst a

7e Effective Annualued Calendar Period I nded June 30.1972 i Granted Date on 1972 Sales 1972 3 Months 6 \1onths 12 Months

, Rate Schedules W holesale' 174 Dec.14.1970 $ 6.000 5 6,000 5 1.300 5 2.700 $ 5,400 18.200 18.200 4.200 8.400 16,600

s. C. Retail ( Permanent > 154 Jan.1.1971 26,300 N. C. Retail i Permanent 10.387 Mar.15.1971 28,800 28.800 6.500 13.300 July 1.1971 4,600 -

4.600 13,600 N.C. Intenm Retail (Terminated 3-26-73 7.11 -

N. C. Ret.ut (Permanenti 8.934 Mar. 27.1972 27.300 21.500 6.200 6.900 6.900 4.154 Apr.1,1972 5.600 4.200 1.300 1.300 1.300 1 S. C. Retad (InterimP Revenues Applicable to 1972 $M5.900 $83.300 $ 19.500 $ 37.200 s 70. t 00 Revenues Applicable to 1971 $11.200 519.600 527.000

Subject to refund with interest.

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2.In 1971 the Company entered into a sale and lease-back agreement for twenty five duai fuel combustion turbines -

which requires annual payments of $5,731,000 for the ten years beginning in 1972 ind $7,924,000 for the r remaining 15 years of the term. Also the Company pays all the expenses in connection with the leased turbines i and has options to repurchase the turbines at stipulated purchase prices after the first ten years. The Company is accruing amounts representing ratable portions of the deferred lease payments net of salvage over the estimated ut:ful lifa of the turbines as rent expense and long-term debt. Such accounting treatmeat is presently under consideration by regulatory authorities, and no determination has yet been made with respect thereto.

3 For income tax purposes the Company depreciates property acquired after 1969 on an accelerated basis with

! normalization accounting using the shorter " class lives' as ptovided by the Intemal Revenue Code. In ace.ardance j

with the Revenue Act of 1971, the Company receives the 4% investment tax credit on qualifying property additions which is being deferred and amortized on the Company's books ove the depreciable lives of the -

related property, i 4.In June 1971 the Company sold its holdings of the capital stock of a non. affiliated company at a gross gain of -

$2,383,000 or $1,594,000 after income taxes (5( per share of common stock).

4 June 30 5.Long-Term Debt: 1972 1971 l

First and Refunding Mortgage Bonds: IThousands of Dollars) j

3% Series due 1975 . . . ..... ................. . ... ...S 40,000 $ 40.000 2.65% Series due 1977 . .. .. . . . .. . ... . .. 40,000 40.000 1 2 7/8"c Series due 1979. .. . . ....... ...... ... . 40.000 40,000 31/4% Serics due 198i . ..... 35,000 35,000 30.000 30,000 3 5/8% Series due 1986. . . ... .. . . .

50.000 50,000 41/2% Series due 1992. . .. .. .. . . .. . . . .

41/4"c Series B due 1992. . . . .... .. .. .... .. 50,000 50.000 40,000 40,000 41/2% Series due 1995. . .. ... ....... .. .. .. .. .....

5 3/8% Series due 1997. . . . . . . . . . .......... .. . . .. .. .. 75,000 75.000

. 6 3/8% Series due 1998 . ... ........ . . ...... . 75,000 75.000 7% Series due 1999 . . . . . ... . ....... .. ... .... .. 75,000 75.000 8% Series B due 1999 . . ..... . ... ........ . .. ...... 75,000 ' 75.000 l 75,000 l 81/2% Series due 2000. . . . . . ...... ... .. . . .... . 75.000 100,000 100,000 l 8 3/S% Series B due 2000 . .... . . ......... . .. .. ......

100.000 100,000 71/2% Series due 2001. . . . ..

7 3/8% Series B due 2001. . . . . . ... .. ..... . ... .. ... 40.000 -

7 3/4?c Series due 200' 100,000 - -

l Sinking Fund Debentures:

36,250 37,500

4 7/8% due 1982 . . . . . . . . .. .. .. ....... ... ....

i Notes:

i 6.a57e due 1978. . . . . . ........ .... . ... ..c. . . 60,000 -

7% due 1977. . . . . . . . . ... .. ..... .... ... ...... . 1,000 -

Turbine Leasing (Note 2) . . ....... .. ..... ... . ...... 7.645 487

Tota! . . . . . . . . ..... . ...... . ......... . . ... 51.144.895 5938.487 i

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W Duke Power Company bN.id i Page 7 Page 13 General Offices: 422 South Church Street P ]

Post Office Box 2178. Charlotte, North Carolins 28201 4g ,

TRANSFER AGENTS FOR COMMON STOCK / $ ,,

Morgan Guaranty Trust Company of New York f North Carolina National Bank. Charlotte f --

REGISTRARS FOR COMMON STOCK )

First National City Bank. New York Wachovia Bank and Trust Company, Charlotte Page 11 Page 21

i Highlights of theYear 1971 1970 -..,c.,

..n..

Electric Revenues:

~

l Total * $451,341,000 $386,138,000 16.9 %

Regular Sales $441,461,000 $370,921,000 19.0 Earnings for Common Stock $ 55,514,000 $ 40,001,000 38.0 Per Share of Commen Stock:

Earnings $1.90 $1.57 19.7 Dividends Paid $1.40 $1.40 -

Taxes-Federal, State and Local $ 46,504,000 $ 42,773,000 8.7 Plant Construction Expenditures $425,632,000 $384,755,000 10.6

, Kilowatthour Sales (thousands):

Total

36,913,000 35,288,000 4.6 Regular Sales 36,265,000 33,399,000 8.6 l Peak Load (KW) 6,622,125 6,283,915 5.4

Customers 1,001,451 965,577 3.7 l inciuc. in: .renano.. Etc.

l Earnings and Dividends Per Share Common Stock I

s2.20 l , j j .

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1.80 '. , ,

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1.60 '

! i EARNINGS i

.8 1962 63 64 65 66 67 68 69 70 1971 Earnings $1.25 1.34 1.48 1.68 1.72 1.8:; 1.91 2.05 1.57 1.88 Dmcenos S .85 .90 .95 1.00 1.10 1.20 1.30 1.40 1.40 1.40 Before extraordinary items and adjusted for s'ock spht.

l Contents l

l President's Letter . 3 Personnel .16 l Production and Construction 5 Subsidiaries . .18 Transmission Growth . 8 Rate Matters . 20 Environmental Advances .10 Financing and Investor Activities 22 Serving Our Customers 12 Financial and Statistical Summary . 29 Directors & Officers .31-32

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The President's Letter While 1971 electric energy sales and operating The Company's construction budget for new revenues set records, inflationary pressures pushed and improved electric plant facilities fw 1972-the costs of doing business progressively higher 1974 is 51.3 billion. Financing requirements in and compelled the Company to seek further in- 1971 were accomplished by the sale and lease of creases in its rates. combustion turbines in January ($65.5 million).

Sales of electricity totaled 36.9 billion kilo- the sale of 4 million shares of common stock in watthours, an increase of 5 per cent over 1970, February ($105 million), the issuance of $100 and electric operating resenues were up 17 per million in First and Refunding Mortgage Bonds cent to $451.5 million. in March, the sale of 600.000 shares of Preferred The continued high cost of interest and pre- Stock in August ($60 million) and the sale in ferred dividends, with only a small reduction in December of $40 million in First and Refunding the price of coal and the delay in commercial op- Mortgage Bonds and $60 million of Seven-Year cration of Unit

1 of the Oconee Nuclear Sta- Notes.(See Page 22).

tion, kept earnings per share from regaining their Construe:!on expendi:ures in 1971 amounted to 1969 level. Earnings per share rose from S t.57 in S426 million and $436 million is budgeted for 1970 to $1.88, a gain of 20 per cent, but still below 1972. (See Page 22).

the $2.05 per share earned in 1969. The shares of An additional $7 million has been allocated to common stock outstanding increased to 30,229,463 system-wide stack emission cor. trol, bringing the during the year, due principally to the sale in Feb- cost of this expanded program to near $50 million.

ruary of 4 million shares. The Company now has Target date for essentially clear stacks at all Duke over 36.000 shareholders. Power fossil-fueled stations is mid-1973. Environ-The $1.88 per share earned in 1971 includes mental quality is a foremost item in the design, 5( per share gain realized from sale of capital construction and operation of all Company facil-stock of a non. affiliated company. ities.

For each month that Unit # 1 of the Oconee A number of management changes were made Nuclear Station is delayed beyond its originally during the year. You will find a summary of these scheduled operating date (Summer 1971), net changes on Page 30.

earnings will be adversely affected to an extent de- We wish to pay tribute to three of our senior of-pendent upon the energy requirements of the ficers who retired from active management during Company. 1971. William B. McGuire served with distinction Since July 1969, the Company has filed and as President and Chief Executive Officer from conducted hearings on six applications for rate in- January 1959 to April 28,1971. D. W. Jones was creases before three regulatory commissions. As a Executive Vice President, Retail Operations from result of these six rate cases, the Company is cur- November 1,1965 to April 28, 1971. G. G.

rently collecting SC6.4 million annually in increas- Mattison was Senior Vice President, Electric In-ed ratr :e page 20 for a more complete descrip- stallations from January 1,1967 to November 1, tion et the rate cases. It will be necessary for the 1971. Together, these three gentlemen gave the Company to seek additional rate relief in 1972, in Company an aggregate of 136 years of highly order to continue its current construction pro- skilled, devoted service.

gram. This report reflects an excellent performance by The Company undertook a program of TV and our employees and we are grateful to them, to newspaper advertising designed to inform its cus- our directors, and to our customers for general temers of the specific rec. sons for this series of recognition that this Company provides efficient rate increases. Samples of some of the ads are en- service at the lowest possible cost. Your support closed with this report. Customer response has as a stockholder has been especially valuable in been generally good. vital undertakings. This entire Company appre-While the cost of coal purchased by the Com- ciates your confidence and will continue its en-pany in recent months has declined somewhat, deavors to deserve it.

the average cost of coal burned in 1971 was 44.56 per milhon BTU,10 per cent higher than For the Board of Directors in 1970. The Company has purchased three coal mines and has joined in the financing of a fourth.

Substantial production is being achieved at these f/ ,

mines and, when fully developed in 1974, they are !

Carl Horn, Jr., Pres. ident expected to furnish about one-third of the Com-pany's coal requirements. February 24,1972 3

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The1971 Revenue Dollar Where it came from DUKE POWER COMPANY DUKE POWER COMPANY e us. p , by PLEASE RETURN THIS STUB WITH f ~ d hs

a. y e dm. d b.IL y ib.dh THE PAYMENT TO YOUR LOCAL I b w r w w *"*** DUKE POWER COMPANY OFFICE.

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Ilow it was used Duke Power Company GENERAL OFFICES: 422 SOUTH CHURCH STREET Post Office Box 2178, Charlotte, f4 orth Carolina 26201 l

S 161,087,000

?^;fa ,, o, FUEL SUPPLIERS AND FF.EIGHT CARRIERS

)NE HUNDRED SIXTY ONE MILLION EI3HTY SEVEN THOUSAND DOLLARS b

DUKE POWER COMPANY 12f 1-E R E K_ {E4

= = & Other l

l Production and Construction The Company placed 336,000 kilowatts of gen- Peak Loads sersus Generating Capabilities eration into service in 1971. This consisted of the and Firm Purchases at Time of Peak Keowee Hsdro Station, 140,000 kilowatts, and

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uituCNS OF KILOWA', r3 ten combustion turbine units totalmg 196,000 kilo-watts at Buzzards Roost. S. C. This brings the !

! total number of quick-start combustion turbines s.e2 to 29 with a total capacity of 638,000 kilowatts. p nr l The first unit of the Oconce Nuclear Station :q was delayed beyond its early 1972 start-up date Generating capabihties ,Ty.T by sibration experienced durin , -

pumps. These huge p'e testsare of primary l Firm Purchases coolant umps, which three stories high, were returned to the supplier [

for corrective measures and are now back at the .

site. Present plans call for the 886.300 kilowatt g unit to begin operation in the summer of 1972. -

p with similar size Units 2 and 3 to join the system 4;.

in 1973. 3.n A new, 590.400 kilowatt coal-burning unit is k 3h nearing completion at the Company's Cliffside #6 @

Station and is expected to begin operation by the 2, f; . 'li summer peak of 1972. r- - J,f-The Jocassee Pumped Storace Hydro Station is w h%

ahead of its original schedule and is expected to ,

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i g be ready for sersice early in 1974 with a capacity C '

pg Gd of 305,000 kilow atts.

Work on the Belews Creek Steam Station,

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year later. The 2,300,000 N!cGuire Nuclear Sta- -

2 tion, near Charlotte, is in the early construction /-"1 ,

7 stace. The first $1cGuire unit is due in early 1976 1961 1968 1971

! and the second in 1977. /

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( 1962 e3 6344 e445 es4e 6647 e74e as-ce so-ro 70-71 71-72 145 j ,

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.!A The 1971 peak load of 6,622,125 kilowatts

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! occurred on June 28, exceeding the 1970 peak l

! load of 6.283,915 kilowatts set on July 29 by 5.4 l l l 120 ' l per cent. The Company had a generating and firm

! purchased capacity at the time of the 1971 peak l

"5 ; load of 7,371,164 kilowatts. The Company's ex-i ; f I l cellent balanced load (winter-summer) pattern

" continued during the year. The 1970-71 winter l ;l j l l j ,

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t l I I peak of 6,398,505 kilowatts, set on January 19,

]971, was eXCecded on January 17,1972, when CONSUMER l l PRICE tNDEX!

} l l the 1971-72 winter peak of 6,723.085 kilowatts t was reached. Reserves at the time of the 1971-72

.3 I peak were 11.2 per cent.

The total energy requirement during 1971 was eo l 39.9 billion kilowatthours. Steam plants (including combustion-type units) produced 36.1 billion kilo-as watthours, while 2 billion kilowatthours came l

from hydro, and 1.8 billion kilowatthours were 80 purchased from sources outside the Company.

Duke purchased power in varying amounts dur-ise2 es 64 es se er es as ro is,,

bg M1 den needed h bad aM m adm economies of operation. Interconnections with

57-58 = 'M neighboring companies will continue to be strength.

Consumer prices rema.n muet %gher than the cost of e'eetncity to Duke s customers. ened for emCrgency Capability.

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The McGuire Substation. near Cowans l Ford Dam in North Carolina. was activated

in 1971. The McGuire Substation is the Companis largest and serves the 112.5 miles l

i of 525.000 soh ti.msmission line completed I at year's end.

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Transmission Growth New and Expanded Industrial Plant Growth The first segment of the Compan{s planned 480 MILLloNS oF DOLLARS structure miles of 525,000 solt transmission circuit was placed in service in June. This segment, which 568' interconnects the McGuire Substation near Char-lotte with Appalachian Power Company in Vir-sss9 ginia, is a little over 80 miles. An additional 32.5-mile segment was completed in 1971 between the McGuire Substation and Newport, S. C., and a 46-o mile section from Newport to Rockingham, N. C.,

is 75 per cent complete. This latter section will in-terconnect with Carolina Power and Light Com-pany.

Expenditures during 1971 for transmission lines, substations and related facilities totaled S78 mil-lion. This included 825 miles of new and uprated transmission circuits resulting in a net addition of 508 circuit miles. l Transformer capacity was increased by 3.6 mil-lion kva in 1971 with the addition of 169 new or uprated substation facilities. Planned expenditures for 1972 for transmission lines and substation ad-ditions of 573.1 million will connect the new gen-eration to the system, contribute to area reliability and serve growing area loads.

Transmission Lines personnel seeded 5,000 f . _7 acres of cleared rights-of-way in 1971, bringing e total number of acres seeded to 0,E MG 1967 1968 1969 1970 1971

/ life conservationists of the Carolinas continue to praise this practice, which started in 1966, and the M,71U1'O2%"JUlo*J"*""' "*'*** '"' " Company is now seeding all cleared rights-of-way.

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An advertising series in 1971 placed em-phasis on the Companis interests and efforts in protecting the environment. These ads and TV commercials showed Company special-ists at their jobs. In the top photo is fisheries biologist Bill Adair. At lower left is Lionel Lewis. nuclear health physicist. and at lower right is George Swearingen, manager of en-vironmental health programs, including mos-quito control, on the Company's 14 lakes.

Environrnental Advances The Company's $50 million program to reduce flyash emissions at its steam stations began to show excellent results during the year. New elec-trostatic precipitators were installed on two units at Lee Steam Station, one at Marshall Steam Sta-tion, two at Dan River Steam Station and two at Allen Steam Station.

The flyash collection devices are to be installed or upgraded on all of the Company's coal-burning units on a scheduled basis. The program will be complete by mid-1973 with the objective of essen-tially clear stacks over the entire system.

The Company's participation in Research Pro-ject 49 continued in 1911. This program is provid-ing data as to the effect of the warmed-water dis-charge at Marshall Steam Station. A state agency, university consultants and Duke Power personnel have been collecting this data for four years and channeling it to Johns Hopkins University, which is conducting the research program for the Edison Electric Institute. To date, we believe that the study has shown a net beneficial effect on Lake Norman from the warmed discharge.

Institutional advertising during the year featured several of the Company's scientists involved in environmental duties. These ads and TV commer-cials stressed the Company's day-to-day concern with protecting the environmental resources nec-essary to the manufacture of electricity and that these resources are enhanced through Company efforts in many cases.

Following the widely publicized "Calvert Cliffs" decision, the AEC asked the Company to show cause why construction of Oconee Units 2 and 3 should not be halted pending a thorough environ-mental review. The depth of Duke Power's long-standing program of serious environmental study and research paid good dividends here. The show cause order was answered rapidly and effectively, and delay of these two major generating additions was avoided.

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Residential Service Ascrage Charge for Electricity Ascrage Annual Usage CENTS PER KsLOWATTHOUR KILoWATTHouRS 10.299 j

2 dse e 208 2.19c N

lW y.430 l

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- 4 1966 1971 1961 1966 1971 l 1961

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Serving Our Customers The Company reached a sig..ificant milestone as over 208 miles of underground lines serving in November 1971, when it exceeded the million over 7,400 new residero.21 customers were in-l mark in total number of customers. The year saw stalled.

I 35.874 customers join Duke lines, bringing the Personal contact with the consumer over the number being served at year's end to 1.001.451. Company's 20.000 square mile service area was The Company's Piedmont Carolinas service provided by all employees in 98 offices serving area continued to attract new and expanded m- customers.

dustry, and for the eleventh straicht year more Duke Power.s longtime national lead m. dusk-i than half of new industries and expansions oc-to-dawn lighting was retained m 1971 as 15,633 i curine in the Carolinas chose the Piedmont area.

f these automatic lights were added to the sys-The Duke area, which is but one-fourth of the tem. The Company now has 131,172 of these off-

'and area of the Carolinas. received $589 million Peak lights, exceeding by far the 94.654 municipal or slichtly over 50 per cent of the 1971 invest-street lights in service at year's end.

ment.

For the five-year period ended 1971, Duke Sixty-three per cent of all new apartments and

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Pewer's service area has been chosen by 1,624 new houses completed within the Duke service area and expanded industries requiring an investment during the year utilized electric heating. This was the sixth straight year that Duke has led the na-by those industries of almost $3 billion. Over 96.000 new jobs have been created by this invest, tion as the dominant supplier of heating energy ment, resulting in an annual payroll increase of for new homes and apartments within its service area.

5500 million.

Service to new customers and more efficient Total-electric homes and apartments joining the service to existing customers required the addi- Duke system in 1971 numbered 22,337 including tion of 1,509 miles of distribution lines in 1971, 2,216 homes which were converted from other bringing the system total for these lines to 45,783 heat sources to electricity. The Company now miles. serves 132,595 total-electric dwelling units av Duke's position as an industry leader in placing counting for over 2.5 billion kilowatthour; an-distribution lines underground continued in 1971 nually.

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Noteworthy industrial expansions completed or announced in 1971 include Charlotte Pipe and Foundry Co. (plastic pipe), Abbott Laboratories (rubber goods), Collins & Aikman Corp. (knitted fabrics), General Tire and Rubber Co. (tires),

General Electric (large gas turbines), Celanese Plastics Company (polyester film), Teledyne Inc.

(metals) and Union Carbide Corp. (electrical iie i products).

The growth in popularity of total-electric mo-bile homes continued during 1971 when 1,433 of

these single-energy mobile living units joines Duke's lines. The Company now has 3,762 total-electric customers among its 61,780 mobile home customers.

The average annual usage per Duke residential customer was 10,299 kilowatthours in 1971, ex-ceeding the national average for investor-owned

companies by 2,869 kilowatthours. The average usage per Duke customer was 83 per cent greater than it was 10 years ago.

LARGE POWER SALES -

The Company's Large Power Sales Group nego-tiated power contracts with large industrial, com-mercial and resale customers, most of which were for contract demands of 500 kilowatts or more, ,

for a net increase of contractual load of 338,195 gqquq kilowatts in 1971, an all-time record. There also was an increase on a contractual basis of 22,050 .

gg kilowatts for industrial customers contracting for N i IIII !

as much as 100 kilc Satts and less than 500 kilo- IM I ,

watts. Hugg ,y i Fifty total-electric industrial plants were added .

p n y in 1971, bringing the net number of such plants ' '

on the Duke system to 276, and once again plac-ing the Compay No.1 in the country in this ,

category.

Industrial sales amounted to 16.4 billion kilo-wattheurs during the year. ,5 '

q Some examples of larger total-electric plants be- --

ginr.:ng operation during the year include Cone Alills Corporation (synthetic foam), Queen City j

! Plastics. Inc. (electrical conduit), Hamco, Inc. (pa- T - .,

7'-

per converters), Southland Authorized Rebuilders, y .s.

Q Inc. (motor vehicle parts) and Unifi, Inc. (textiles). Q [_

The continuing diversification of industry join. -

ing Duke lines is emphasized by these new com- ( *%

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panies: Lenoir Chair Company (particle board),

Stork Inter-America Corp. (galvano plating),

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Gould, Inc. (batteries) Hancor, Inc. (plastics), the 32. story Jefferson First Union Tower, Stroupe Alirror Co., Inc. (mirrors), Diamond opened in Charlotte in 1971. Tha tower Shamrock Corp. (chemicals), Crompton & e ntains 92.000 square feet and its annex

. .26,000 square feet, adding up to 768.000 l Knowles Corporation (textile mach.mery) and Col- square feet of total-electric commercial onial Stores (milk crocessing). space.

13

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l l Examples of the more than 1.400 total-I electric commercial buildings join.9g Dukc's i

! hnes in 1971 are the Knight Publishing Com-l pany (top) in Charlotte. 340.000 square feet,

( and the Burlington Industries. Inc., head-l cuarters building in Greensboro. 380.000 l square feet.

l l

COM.41ERCIAL t i

Over fourteen hundred total-elect: .c commer-l cial buildings joined Duke lines in 1971, bringing i the system to;al to 7,672 such buildings. These buildings added 106.000 kilowatts of commercial heating space, which was a 14 per cent increase over 1970.

l Commercial revenues in 1971 were up 20 per !

l cent over the previous year on sales of 5.9 billion l kilowatthours. l One of the Southeast's tallest office buildings, r Jefferson First Union Tower, opened in Charlotte, 1 N. C., during the year. This is a 32-story building

]

containing 542,000 square feet and is heated en- -

tirely by electricity. Its annex, containing 226.000 square feet, was converted to electric heat.

Charlotte's " Total-Electric Skyline" was further !

enhanced by a new Merchandise Mart (516,000 square feet), North Carolina National Bank Com- i puter Center (124,000 square feet) and the Knight .

Publishing Company building (340,000 square j feet). A 14-story all-electric office building, being l Number of Total Electric Residences built by Northwestern Bank, is well underway, as THOUSANDS oF RESIDENCES

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well as a 405,000 square foot city-owned Civic o o m.m e .4 n.. ,,, Center.

1 Eff.*0."?"AZ,W,*/ Burlington Industries, Inc. occupied its new

'E!%7','.%'b.,,, 380,000 square foot headquaners building in in*N.1,';*,,"*" "*'" '" Greensboro during the year, and Wachovia Bank and Trust Company began full use of its new 300,000 square foot home office building in Winston-Salem. Both of these buildings are total-9 .2 electric. i The Company continued its longtime assistance j to agriculture in the Piedmont Carolinas by sup- l 72 e plying professional advice in converting labor-short farming operations to modern electrical methods. The Duke system now has 1,774 total-se s electric farms among its 33,226 farm classifica-tion customers.

The demand for heating energy among all class-ifications of Duke customers has enabled the Company to continue its balanced-load growth and resulting high load factor. Generating facil-ities are now utilized on a year-round basis, with winter heating energy offsetting the continued up-surge in summer air conditioning load. The Com-pany's marketing efforts have been directed almost

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entirely toward increasing winter usage of its 1967 1968 1969 1970 1971 ,

generating and distribution facilities, resulting in I / well-balanced summer-winter loads.

14

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f Joe S. Major. Vice President.l ersonnel trignth congratulates three Duke Power em-playecs who won 1971 Robinson Awards for outstandmg company contributions. Left to right are James L. Davis. Olin G. Drake and

' Jimmy A. Hardin.

Personnel Company employees totaled 11,302 at year end, the Greensboro Operating Division completed including 3.910 who are engagsJ in the design and more than a million hou'rs without a disabling in-construction of generating facilities. Duke Power jury. The Gastonia District, the Cliffside Steam is one of the few utilities in the nation which de- Station and the High Point District continued signs and constructs most of its generating plants. their safe work practices through the year 1971 The majority of Company employees continued and are now working toward the 2 million man-to participate in the Stock Purchase-Savings Pro- hour goal. These achievements were cited by the gram established by the Company in 1959. Of the Edison Electric Institute and by state organiza-employees eligible, 72 percent were sharing in tions.

Company operations through the purchase of com- Safe vehicle operation continues within the mon stock when the last class began on July 1, Company. A highlight of this was achieving the 1971. Since the plan's inception, employees have lowest accident frequency rate in the Southeastern purchased 816,100 shares of stock through pay- Electric Exchange Fleet Accident Prevention Con-roll deduction through 1971. Under a similar plan, test.

3,965 employees are purchasing U. S. Savings The effects of the new Occupational Safety and Bonds. Health Act are not fully known. The Company The Company continued its effort to keep all believes that it is in compliance, but will continue employees abreast of new developments affecting to fWlow this closely.

Company business through its employee communi-cations programs and publications. ROBINSON AWARDS Judgement and action in emergencies and orig-inal design and production of special equipment TRAINING PROGRASIS won 1970 Robinson Awards for three employees.

4 The Supervisory-Management Development These prized awards, gisen annually, recognize Program provided training for 233 supervisors and employees for outstanding service in several cate-middle-management employees in 1971. This pro- gories. The winners are nominated and selected by

, gram has provided training for 2,098 such em- fellow employees.

ployees s, m ce its inception, review sessions for The 1970 awards went to James L. Davis, Utili-1,151 of these, and one additional review ses-ty Operator at the Lee Steam Station near William-sion for 362 supersisors. Departmental training ston, S. C.; Olin G. Drake, Lineman A in the efforts also contributed to the oserall training Greenville , S. C., District; and Jimmy A. Hardin, P' E' S- Line Foreman in Transmission Line Construction, Eighty-eight employees completed 161 courses Charlotte, N. C.

under the Tuition Refund Program in 1971, and Davis' award was for exceptional action and 121 cmployees are currently enrolled in classes bravery during a transformer fire at the he Sta-which will contribute to their future job progress tion. Drake was honored for aiding the recovery

' under thts system.

of a fellow employee who was injured in an on-the-job accident, and Hardin's award resulted from SAFETY his design and production of equipment used in the The efforts of the work force to reduce acci- construction of a 525,000 volt transmission line dents continued within our Company. As a result. through rough mountain terrain.

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Crescent T. a nd & Timber Corp. an-nounced in January 1972, that it had selected Reahec Inc. fron a number of excellent pro-posals to develop the first resort-residential community on tie shores of Lake Keosec.

In the photo Stat ley P. Whitcomb Jr Ex-ecutive Vice President, Realtec (left) and Herman Hermel.nk. President. Crescent Land & Timber Corp., field questions from newsmen and area officials at the announce-ment.

Subsidiaries CRESCENT LAND & TIMBER CORP. cords, producing revenue of about $1,300,000.

Crescent Land & Timber Corp. owns approxi- EASTOVER LAND AND MINING mately 300,000 acres of nonutility lands which are COMPANIES being utilized for scientific forestry operations, In an effort to assure an adequate supply in the game reserves and real estate development. future, the Company has purchased three coal In April 1971, Crescent announced it had properties which are presently under development adopted a long-range plan to develop its Keowee- and are currently producing in excess of one mil-Toxaway lands in South Carolina through private lion tons of coal on an annual basis. These proper-developers. The concept calh *. for quality devel- ties are located in the Harlan, Kentucky area.

opment of the Lake Keowee shore areas-including The present capital investment in the Eastover resorts, marinas, campgrounds of several types, operation is about $15 million, representing pri-restaurant and motel facilities, and residential marily coal reserves and mining equipment. East-

"'" 8 -

oser's recoverable reserves in the Harlan area are This concept rec ived endorsement from all estimated at about 225 million tons.

state, county and area agencies consulted, and in Production for the year 1972 is expected to be late 1971 Crescent reviewed a number of plans 2% million tons. Full production is expected by submitted by developers and selected Realtec, Inc. 1974, and at that time the Eastover properties and to initially develop a 1,600-acre site into a quality other Duke Power mining investments will be pro-residential and commercial area. Realtec, a na-ducing approximately one-third of the Company's tionally known land development company, has coal requirements.

had other recreation and resort projects in nearby The coal reserves are owned by Eastover Land North Carolina. Company, while the mine development and opera-The financing of all of Crescent's activities is tions are conducted by another subsidiary, East-being obtained independently of Duke Power. over Mining Company.

Crescent is a stockholder in Carowinds, Inc.,

which is developing a $24 million Disney-type MILL-POWER SUPPLY COMPANY amusement park on the North Carolina-South Mill-Power Supply Company, a Duke Power Carolina State line and Interstate I */7. This park subsidiary for 61 years, will move its sales offices is expected to begia operation in 1973. and warehouse operations to new and larger quar-Crescent has recently sold its holdings in two ters in 1972 in order to meet its growing needs as apartment complexes to joint-venture partners. an electrical wholesale distributor serving the In 1971, Crescent, in carrying out the Forestry Carolinas.

Program begurt by Duke Power in 1939, planted Mill-Power also purchases, as agent for Duke 1.5 million trees on 2,900 acres, bringing these and in Duke's name, fuel used in electric genera-totals to over 41 million trees planted on 55,000 tion and electrical equipment and supplies. Duke acres. Sawtimber sales amounted to 33 million pays Mill-Power an annual purchase fee based on board feet and pulpwood sales exceeded 65,000 its actual cost of providing this service.

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Robert E. Frazer, Vice President Finance and Treasurer, discusses the Company's fi-nancial affairs with The New York Society of Security Analysts.

Rate Matters On January 31,1972 the North Carolina Utili- made permanent an emergency interim 4.2 per ties Commission approved an increase in rates to cent increase effective on June 1,1970. These retail customers in North Carolina of 8.93% or rate increases provided additicnal revenues cf

$24.4 million annua ry based on 1971 sales. The $16,100,000 in 1971.

Commission's action grants 76% of the 11.75% A Federal Power Commission Hearing Exam-rate increase requested by the Company in Au- iner issued on February 2,1972, an initial decision gust 1971 and affirms the interim 7.1% increase that would grant the Company a substantial por-placed in effect on an interim basis on July 1, tion of the rate increase on its wholesale business 1971. The increase to become effective on electric that had been previously granted on an interim bills renc'ered on and after March 15,1972 for basis. The decision, which is subject to review by energy sold after February 15,1972 may be nost- the Commission, grants a major part of the 17 per poned as a result of an announcement by the Price cent increase initially requested, an overall rate of Commission on February 10,1972 affecting price return of 7.75 per cent on Duke's wholesale busi-increates by privately owned public utilities. The ness, and an 11.16 per cent allowance on equity.

Company will continue to collect the interim 7.1% Should the decision be upheld, the Company esti-increase which became effective on July 1,1971 mates that the amount to be refunded will not but it may have to delay putting into effect the exceed 15 per cent of the amount collected.

additional 1.83% authorized by the North Caro- The Company's operating expenses and capital s lina Utilities Commission. costs are continuing to rise, and management plans The interim increase of 7.1% provided to file early in 1972 for additional rate relief with

$9,000,000 for the year 1971. the Ncrth Carolina Utilities Commission, The The Public Service Commission of South Caro- Public Service Commission of South Carolina and lina, after a public hearing, authorized the Com- the Federal Power Commission. The amount of pany on December 2,1970 to increase, effective such relief to be requested has not yet been de-January 1,1971, its rates to retail customers in termined.

South Carolina by 15 per cen', which included and 80

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Financing and Investor Activities The Company is engaged in a continuous con- Financing plans for die first quarter of 1972 struction program to meet the increasing electri- include the issuance of 5,000,000 shares of com-cal energy needs of its more than one million mon stock and $100,000,000 principal amount of customers. Construction expenditues for 1971 first mortgage bonds. AJditionr1 't. .md equity amounted to 5426 million consisting of $271 mil- securities are expected to be offered later in 1972.

lion for electrical generating facilities (including The Company endeasors to keep its stockhold-5145 million for nucicar plants and nuclear fuel ers and the investment cornmunity informed of the assemblies), S78 million for transmission facilities, Company affairs. On January 5,1972, members

$66 million for distribution facilities and $11 mil- of management appeared before The New York lion for other plar.t facilities. The construction pro- Society of Security Anasysts to discuss the financial gram for 1972 is budgeted at $436 million and affairs of Duke Power, and copies of the Com-51.3 billion is budgeted for 1972-1974, including pany's presentation were mailed to all stockhold-5835 million for additional generating facilities. ers. Plans are under way to visit other security Funds generated from internal operations of the analysts and institutional investment groups in Company, principally retained earnings and depre- several major citier in the nation.

ciation accruals, prosided 17 per cent of the cash Duke Power's common stock continues to have requirements for the 1971 construction program a broad base of ownership with shareholders lo-and are expected to produce about 30 per cent of cated in every state and many fcreign countries.

the construction expenditures for the years 1972- The number of shareholders has increased from 1974. The balr.nce of construction funds for 1971 3,600 in 1960 to over 36,000 today. As might be was obtained from the following sources: expected, Duke's hou:: states of North and South Common stock-- Carolina top the shareholder distribution list.

4,000,000 shares @ $26.25- Over 6,400 employees of the Company have Public offering $105,000,000 become shar,: holders by participating in Duke 152,417 shares @ $23.54 Power's Employee Stock Purchase-Savings Pro-issued to the Trustee of the gram.

Stock Purchase-Savings Program for Duke Power Employees 3,588,0u3 144,570 shares @ $25.75 for acquisition of coal properties 3,722,000 Preferred stock 8.20%. Series G-600,000 shares @ par of $100. 60,000,000 First and refunding mortgage bonds-7% % Series duc 2001 100,000,000 7% % Series B, due 2001 40,000,000 6.85% Notes due 1978. 60,000,000

. Sale and lease of combustion turbines 65,500,000 ,

Retiremcat of sinking fund debentures ( 1,250,000)

Cost of financing less premium on sales ( 5,872,000)

Reduction in short-term notes ( 70,463,000)

Net proceeds from financing $360,225,000 33

Statement of Source of Funds for l Plant Construction Expenditures !

l T..,~.o...... 1971 1970 l SOURCE OF FUNDS:

l Funds from operations- !

Net income . $ 71,855,000 $ 51,178,000 Non-cash charges:

Depreciation and amortization 54,238,000 49,377,000 Other, net 5,859,000 303,000 Funds from operations 131,952,000 100,858,000 Dividends on common stock . , . . . . . . . .

(40,763,000) (35,271,000)

Dividends on preference and preferred stock (16,341,000) (11,177,000)

Funds retained in the business 74,848,000 54,410,000 Funds from financing-net proceeds-First mortgage bonds 138,946,000 173,401,000 6.85% notes due 1978 59,537,000 -

Preferred stock 59,142,000 59,127,000 Common stock .

108,813,000 64,174,000 Increase (decrease) in notes payable . (70,463,000) 60,989,000 Retirement of sinking fund de mtures (1,250,000) (1,250,000)

Sale and lease of combustion turbines 65,500,000 -

Funds from financing 360,225,000 356,441,000 Total available funds 435,073,000 410,851,000 Changes in working capital, etc.-

Inventories . .. . . . . . 1,172,000 (26,591,000) investments in and advances to subsidiaries (4,486,000) (2,021,000)

Other (6,127,000) 2,516,000 PLANT CONSTRUCTION EXPENDITURES $425,632,000 $384,755,000 s.. noi.. to ein.nci.i it.i.m.ni.

Accountants' Opinion H AS KINS S SELLS C ERTIFICO PUBLIC ACCOUNTANTS DUKE POWER COMPANY:

We hne examined the balance sheet of Duke Power Company as of December 31.1971 and 1970 and the related statements of income, retained earnings, and source of funds for plant construction expenditures for the two years ended December 31, 1971. Our examination was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accoimting records and such other auditing procedures as we considered accessary in the circumstances.

In our opinion, subject to final settlement of the rate matters referred to in note I to the financial state-ments, the accompanying financial statements present fairly the financial position of the Company at Dece nber 31,1971 and 1970 and th. results of its operations and its source of feads for plant construc-tion expenditures for the two years ended December 31, 1971, in conformity with generally accepted accrunting principles applied on a consistent basis.

Charlotte, North Carol.ma February'15,1972 23

Balance Sheet - ASSETS '

1971 1970 ELECTRIC PLANT At original cost-Electric plant in service $1,803,683,00G S1,647,206,000 Construction work in progress (includes in 1971 S321,474,000 of nuclear and $202,023,000 of other generating facilities) 616,127,000 462,588,000 Total 2,419,810,000 2,109,794,000 ;

Less-Accumulated depreciation (Note 2) 534,216,000 492,083,000 l Electric plant, net (excludes nuclear l fuel assemblies) 1,885 534,000 1,617,711,000 '

Nuclear fuel assemblies '.29,762,000 586,000 Electric plant, net ] ,925,356,000 1,618,297,000 OTHER PROPERTY At cost 17,154,000 15,859,000 Less-Accumulated depreciation 2,534,000 2,291,000 Other property, net 14,620,000 13,568,000 INVESTMENTS Investments in and advances to subsidiaries at equity 34,390,000 27,885,000 Other securities-at cost or less 5,336,000 1,076,000 39,726,000 28,961,000 CURRENT ASSETS Cash 15,935,000 15,147,000 Re:eivables, less allowance for losses 36,972,000 34,880,000 Mr.terials and =,upplies-at average cost:

Fuel 28,648,000 33,086,000 i Other . 30,762,000 27,496,000

( Prepayments 290,000 344,000 112,607,000 110,953,000 DEFERRED DEBITS Debt discount, premium and expense, being

amortized 5,062,000 3,662,000 l Other . 4,935,000 2,600,000 l 9,997,000 6,262,000 S2,102,306,000 $1,778,041,000 l

$2.460 Electric l'lant insestment Capitalization MILLl')NS OF DOLLARS MILLIONS OF DOLLARS 3'Q'Z"j $1.896 accm a o.v.cim,oa

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Balance Sheet-UABILITIES c .,.. . , 1971 1970 l CAPITALIZATION Capital stock and retained earnings (Note 3): )

Common stuck, no par S 498.207,000 $ 385,897,000 Retained earnings 81,818,000 71,422,000 l Total commor: stock equ:ty 580,025,000 457,319.000 1 Preference stock-$100 par 50,000,000 50,000,000 j Preferred stock-S100 par 225,000,000 1 65,000,000 Total capital stock and retained earnings 855,025,000 672,319,000 j Long-term debt (Notes 4 and 5) 1,040,891,000 837,500,000 Total capitalization 1,895,916,000 1,509,819,000 CURRENT LIABILITIES Accounts payable 22,917,000 21,438,000 Customers' deposits . 2,217,000 2,732,000 Taxes accrued 5,867,000 9,287,000 l Interest ac: rued 21,444,000 18,500,000 Other 2,616,000 1,660,000 .

55,061,000 53,617,000 Notes cayable for construction-pending permanent financing (Note 6) 119,343,000 189,806,000 174,404,000 243,423,000 DEFERRED CREDITS, ETC. Investmen: tax credit, being amortized 11,021,000 12,524,000 l Contributions in aid of construction 8,729,000 7,230,000 ,

Accumulated deferred income taxes (Note 8) 8,612,000 1,812,000 ;

injuries and damages reserve 2,228,000 2,266,000 Other deferred credits 1,396,000 967,000 Commitments (Note 7) 31,986,000 24,799,000

$2,102,306,000 51,778,041,000 e...................

1 Statement of Retained Earnings i

...,~.o....,,, 1971 1970 RETAINED EARNINGS-Beginning of year S 71,422,000 $ 66,941,000 ADD:

Net income .

. 71,855,000 51,178,000 Undistributed earnings of subsidiaries at January 1,1970 - 3,098,000 Total 143,277,000 121,217,000 CEDUCT':

Cash dividends-Common stock ($1.40 per share) 40,763,000 35,271,000 Preference stock ($6.75 per share) 3,375,000 3,375,000 l Preferred stock- 1 Series C ($4.50 per share) 1,575,000 1,575,000 l l 2,002,000 2,002,000 Series D ($5.72 per share) '

Series E ($6.72 per share) 2,352,000 2,352,000 Series F ($8.70 per share) 5,220,000 1,873,000 Series G (annual rate $8.20 per share) 1,817,000 -

Capital stock expense 4,355,000 3,347,000 Total deductions 61,459,000 49,795,000 RETAINED EARNINGS-End of year S 81,818,000 S 71,422,000 l See notes to ftnaticia, stat.m.nt.

1

Statement ofIncome

.........~....., 1971 1970 ELECTRIC REVENUES (Note 1) $451,541,000 $386,138,000 ELECTRIC EXPENSES AND TAXES:

Operation-Fuel used in electric generation 161,087,000 140,526,000 Purchased power 18,510,000 13,874,000 Wages and benefits, materials, etc. 59,376,000 49,119,000 Maintenance of plant facilities-wages, materials, etc. 22,205,000 18,788,000 Depreciation 53,062,000 48,427,000 Taxes (Note 8)-

General 39,226,000 35,163,000 Federal income 8,790,000 8,516,000 State income 1,850,000 2,387,000 Provision for deferred income taxes . 6,800,000 1,812,000 investment tax credit:

Tax credit deferred 2,763,000 3,134,000 Amortization of deferments (credit) (4,183,000) (3,907,000)

Total electric expenses and taxes 369,486,000 317,839,000 Electric operating income 82,055,000 68,299,000 OTHER INCOME:

Allowance for funds used during construction 37,676,000 24,342,000 Earnings of subsidiaries . 2,424,000 1,763,000 Dividends and interest 731,000 133,000 Other, net (N'ote 10) 1,811,000 (49,000)

Income tax-credit 9,553,000 8,247,000 Total other income 52,195,000 34,436,000 Gross income 134,250,000 102,735,000 INTEREST DEDUCTIONS:

Interest on long-term debt 54,912,000 42,291,000 Other interest 7,351,000 9,131,000 Amortization of debt discount, premium and expense . 132,000 135,000 Total interest deductions 62,395,000 51,557,000 Net income . 71,855,000 51,178,000 DIVIDENDS ON PREFERENCE AND PREFERRED STOCK 16,341,000 11,177,000 Earnings for common stock $ 55,514,000 $ 40,001,0{

AVERAGE COMMON SHARES OUTSTANDING 29,482,000 25,413,000 EARNINGS PER SHARE OF COMMON STOCK $1.88 $1.57 s.. nei.. io nnenew .m. m.

26

Notes to Financial Statements

1. Rate Increases. During 1970 and 1971, the Com- against dilution and will change upon the issuance of pany received permanent rate increases from the North 5,000,000 additional shares of common stock planned Carolina Utilities Commission and The Public Service for the first quarter of 1972. At December 31,1971, Commission of South Carolina for customers served 1,517,451 shares of the common stock were reserved under retail rate schedules. These rate increases and for the conversion of the Series AA Preference Stock 1 those referred to in the following paragraph pro- and an additional 183,900 shares were reserved for duced additional revenues of S8,600,000 in 1970 and issuance under the Stock Purchase-Savings Program

$52,500,0(X) (including revenues subject to refund) for Employees.

in 1971. The outstanding preference and preferred capital The Federa! Power Commission in December 1970 stocks are callable at various redemption prices not allowed an increase (subject to refund with interest) exceeding $110 a share plus accumulated dividends in rates for wholesale customers which produced to redemption date.

55,200,000 of revenues in 1971; under an initial de- 4. Sale and Lease of Combustion Turbines. In Jan-cision of a Federal Power Commission hearing exam- uary 1971, the Company entered into net lease trans-iner dated February 2,1972, a major portion of this actions with respect to twenty-five dual-fuel combus-increase would be granted permanently; such decision tion turbines either owned by the Company or under is subject to review by the Federal Power Commission. purchase orders for delivery during 1971. Such trans-In 1971, the Company received a 7.1% interim rate actions involved the assignment of the Company's increase (subject to refund with interest) from the rights under the purchase orders and the sale of the North Carolina Utilities Commission for customers turbines owned by it, for which the Company received served under retail rate schedules, which produced $65,500,000. The leases required an initial payment S9,000,000 of revenues in that year; the Commission's of about $3,200,000 in October 1971, and annual order dated January 31, 1972 granted a permanent payments of $5,731,000 for the first ten years and 8.93G increase (including such interim increase) $7,924,000 for the remaining fifteen years of the term.

which has been submitted to the Price Commission. Also, the Company pays all expenses in connection (See page 20 under " Rate Matters".) with the leased turbines including taxes, operating

2. Depreciation of Electric Plant. Provisions for de- costs and maintenance. The Company has options to preciation are recorded using the straight-line method repurchase the turbines at stipulated purchase prices at annual rates which average 3.17% for 1971 and after the first ten years.

3.24% for 1970. The Company is accruing amounts representing

3. Capital Stock. The Company's authorized capital ratable portions of the deferred lease payments net of stock consists of 1,500,000 shares of preference stock, salvage over the estimated useful life of the turbines 2,250,000 shares of preferred stock and 50,000,000 as rent expense and long-term debt. Such accounting shares of common stock. treatment is presently under consideration by regula-December 31 tory authorities and no determination has yet been 1971 1970 made with respect thereto. ;

Outstanding Capital Stock:

Common stock, no par- J (1971-30.229.463 shs. 5. Long-Term Debt: 1 1970--25.932.476 shs.) _5498.207.000 5385.897.000 Preference stock. $100 par- December 31 64 % Convertit'le Series AA 1971 1970 (500.000 shs.) _ $ 50.000.000 $ 50.000.000 First and Refunding Preferred stock. $1N par- 3fortgage Bonds:

4.50G Series C (350.000 shs.) 5 35,000,000 $ 35,000,000 5.72G Series D (350,000 shs.) . 35,000,000 35,000.000 3c'c Series due 1975 . .$ 40.000.000 $ 40.000,000 6.72G Series E (350,000 shs.) , 35,000,000 35,000.000 2.65% Series due 1977 40.000.000 40.000.000 3.G Series due 1979 40.000.000 40.000,000 8.70G Series F (600.000 shs.) . 60,000,000 60,000,000 35.000,000 8.20% Series G (600,000 shs.)_ 60,000.000 -

34 G Series due 1981. 35.000.000 3sece Series due 1986 30.000.000 30.000,000 Total $225.000.000 5165.000.000 4%G Series due 1992 . _ _ .

50.000.000 50,000.000 50.000.000 50.000.000 I The changes in capital stock during 1971 are de- 4%GfeSeries 4n Series dueB 1995 due 1992

_. _40.000.000 40.000.000 i scribed under "Financine and Investor Activities" on 5%G Series due 1997 75.000.000 75,000.000 l Se 98 0 page 22. In 1970,2,6925737 shares of common stock fcf'cS l,iesjuet9 were issued for a consideration of $66,648,000. 8% Series B due 1999 75.000.000 75.000.000 The outstanding Preference Stock,6% % Converti-ble Series AA, is convertible into shares of common M Nr$bebi 76G Series due 2001 .

INN $

100.000.000 INS _

9 "

stock at the adjusted. conversion price of $32.95 per 4[G 5$k1ng F nd share, effective February 1971, each share of such Debentures due 1982 36,250.000 37.500,000 preference stock being taken at $100 for such pur- 6.85G Notes due 1978 60.000.000 _

Turbine Leasing tNote 4) 4.641.000 _

poses. The conversion price is subject to certain ad. _

Total sim.89tm 5837.500.000 justments designed to protect the conversion privilege

, 27

i l

l l

Notes to Financial Statements----continued l

6. Financing. See page 22 under " Financing and In- Income taxes reflect tax benefits of approximately i

sestor Activities" for information concerning debt and 56.592,000 for 1971 and 56,385,000 for 1970 re- '

equity curities issued during 1971 and to be issued sulting from the deduction for income tax purposes durir, the first quarter of 1972. of items capitalized for book purposes in connection l l 7. Commitments. Capital expenditures for property with the expanding construction program (principally additions for 1972-1974 are estimated at $1.3 billion certain taxes and pension costs) and of accelerated of which $436 million is expected to be spent in 1972. deprecia':en with " flow through" accounting for cer-

8. Income Tnses. The Company depreciates property tain electric plant additions in 1968 and 1969.

acquired after 1969 on an accelerated basis for in- 9. Retirement Plan Cost. The Company has a non-l come tax purposes and presides for deferred in- contributory Employees' Retirement Plan for the bene-come taxes under normalization accounting as per- fit of substantially all of its employees. The Company's i mitted by the Federal Tax Reform Act of 1969, using policy is to fund pension cost accrued. Costs for 1971 l the " class lives" provided in the Revenue Act of 1971 and 1970 were 54.185.000 and 54,443,000, respec-for 10 71 add;tions. The Revenue Act of 1971 also tively.

I provides for the restoration of the investment tax 10. Other Income. In June 1971, the Company sold l credit at a rate of 47c. For 1971 such investment its holdings of the capital stock of a non-affiliated credits amounted to $1.242,000 and is being de- company at a net pain of 51.594,000 or 5.05 per com-I ferred and amortized on the books of the Company mon share.

over the depreciable lives of the related property.

Cost of Fuel Used in Electric Generation Embedded Cost of Money

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Financialand StatisticalSummary 1971 1970 1969 1968 1967 1961 INCOME DATA (DOLLARS IN THOUSANDS)

E!ectric revenues: $ 71,972 Residential sales $ 166,442 $ 140.281 $ 126.145 $ 114.576 $ 103.127 Commercial sales 91.183 75.951 66.378 59.650 52.490 31.616 Industrial sales 139,560 118.811 109.688 102.627 93.730 54.331 Other energy sales 49,796 47.565 36.576 32.255 30.036 16.647 4.560 3.530 3.455 3.138 2.939 1,758 Other revenues Total electric revenues 451,541 386.138 342.242 312.246 282.322 176.324 Electric expenses and taxes:

Operation and maintenance 261.178 222,307 162.404 140.097 123,121 73.069 Depreciatic,i 53,062 48.427 41,934 38.075 34.544 23.604 Taxes 55,246 47.105 65.892 73.057 65.571 44.945 Total electric expenses and taxes 369.486 317.839 270.230 251.229 223.236 141.618 Electric operatmg income 82.055 68.299 72.012 61,017 59,086 34,706 Other income:

Allowance i funds used during coristruction 37.676 24,342 15.711 9.667 4.245 2.025 14,519 10.094 5.639 4.000 2.067 1,611 Other ince st Interest dedw (62.395) (51.557) (38.945) (25.543) (19.205) (11,108)

Income mre extraordinary itcm 71,855 51,178 54,417 49,141 46,193 27,234 Extraordinary item - - - - 854 -

71,855 51,178 54,417 49,141 47,047 27.234 Net income (a)

Dividends on preference and preferred stock 16,341 11.177 6.969 4.970 3.514 1.360 Earnine for common stock 55,514 40.001 47,448 44,171 43.533 25.874 Dividends on common stock 40,763 35.271 22.478 30.069 27.676 18.088 Earnings retained for use in the business $ 14,751 $ 4.730 $ 14.970 $ 14.102 $ 15.857 $ 7,786 COMMON STOCK DATA Shares of common stock-year end (thousands) 30,229 25.932 23.240 23,160 23,094 22,812(b)

Per share of common stock (a) (average shares):

Earnmgs before extraordinary item (a) $ 1.88 $ 1.57 5 2.05 $ 1.91 $ 1.85 $ 1.15 Extraordmary item. net of related income taxes - - - - .04 -

Earnings for common stock (a) 1.88 1.57 2.05 1.91 1.89 1.15 Dividends paid 1.40 1.40 1.40 1.30 1.20 .80 Market value-high-low 27 % -20 % 29 % -20 % 43 % -27 % 43%-33Ya 43 % -30 31 % -25 %

-year end 23 % 24 % 29 % 38 % 37 27 %

BALANCE SHEET DATA (DOLLARS IN THOUSAND3)

Electric plant (original cost) $2,459.572 $2.110.380 $1,735.861 $1,466.874 $1,281,135 $ 798.849 Accumulated depreciation 534,216 492,083 451.802 418.298 387,959 234.986 Capitalization and short-term notes:

Common stock equity 580.025 457.319 386,190 369.233 353,150 264,656 Preference stock 50,000 50.000 50.000 - - -

Preferred stock 225.000 165.000 105.000 105.000 70.000 25.284 Long-term debt 1,040.891 837,500 663.750 515.000 441,250 283.750 Short-term notes payable 119,343 189,806 128,817 100.340 81.400 14.800 ELECTRIC AND OTHER STATISTICS Kilowatthour sales (millions):

Residential 8.780 8.126 7.340 6.547 5,777 3.690 Commercial 5,938 5.21 4.767 4,197 3.579 1.737 Industrial 16.357 15,140 14.593 13.634 12.337 6.995 l Other 5,838 6.631 5.180 4.521 4.223 2.087 l Total kilowatthour sales 36,913 35.288 31.880 28.899 25.916 14.509 )

Number of customers (year end):

Residential 864,361 835,706 810.743 785.830 762.658 638.117 Other 137.090 129.871 124.496 119.959 114.874 91.537 l Total customers 1,001,451 955.577 935.239 905.789 877,532 729.654 l Residential customer data:

Average annual KWH use 10.299 9.864 9.179 8.432 7.664 5.636 Average revenue per KWH 1.90c 1.73c 1.72c 1.75c 1.798 1.95c Number of employees (year end):

Operating and maintenance 7,392 7.363 6.933 6,488 6.150 5.459 Generating plant construction and engineering 3,910 3.210 2.596 1,597 1,046 1,101 Source of energy (millions of KWH):

Generated-Steam 35.393 34.212 30.591 28.019 26.276 13.854

-Hydro 2.028 1,491 1,784 1.521 1.315 1.643

-Combustion turbines 726 837 643 173 2 -

Purchased and net interchange 1,789 1,728 1.534 1.801 546 350 Loss and company use 3.023 2.979 2.672 2.615 2.223 1,488

e loss and company use 7.5% 7.8% 7.7% 8.2% 7.8% 9.4%

System average heat rate 9,728 9.784 9.738 9.700 9.691 9.546 System load factor 68.2 % 66.6 % 68.9 % 65.9 % 70.1 % 63.8 %

(a) Net mcome for 1969 has been increased by ss.125.0c0 (s 22 per common snaren as a result of car'ain cmanges as follows: (i) s72s.000 from reduction of dooreciation rates rar electric gene atro facilmes to the teter'ial Reve%e service gwdelsre rates tst.629.000 reduction in decrecist,an less related income taxest; fil) s2.6s3.000 f

in'3m comereduction of shemamortdatron tan a,:countmg connection epersod of defe' in the use red mvestment for income tax ps.rposestanofcredits from twenty-fave a:ceterated to five depreciation on years;toand add.tsons (iii) st.7s0.C00 eiectric from the adcotion generating, transmission of " flow-t and certain gene's4 p' ant facdoties acamred in 199 and 1969.

(t) TI's riumcer of shafes of cor'imon art.ck has been adiusted for 2 for 1 sotit in 1964 gg

Management Changes The Board of Directors elected Carl Horn, Jr.,

to serve as President of the Company on April 28, 1971, replacing W. B. McGuire, who retired as President after 12 years. Mr. Horn. 50, had been serving as Executive Vice President and General Counsel. Mr. McGuire continues as a director of the Company.

In other Board action of the same date, B. B.

Parker was named Executive Vice President and General Manager; D. W. Booth was elevated to Senior Vice President-Retail Operations; and W.

S. Lee was named Senior Vice President-Engi-neering and Construction.

Booth replaced D. W. Jones, who retired from active management but remains a vice president and member of the Board.

William H. Grigg was named Vice President and General Counsel; John D. Hicks, Vice Presi-dent-Corporate Affairs; P. D. Huff, Vice Presi-dent-Distribution-Engineering; J. W. Lewis, Vice President-District Operations; Henry H. Orr, Vice President-Marketing; Warren H. Owen, Vice Pres-ident-Design Engineering; Steve C. Griffith, Jr.,

Secretary and Associate General Counsel.

In July the Board named Austin C. Thies and Chas. B. Wade, Senior Vice President and Direc-tot of R. J. Reynolds Tobacco Co. and a Director of R. J. Reynolds Industries, to directorships.

Thies, previously Vice President-Power Opera-tions, was named Senior Vice President-Produc-tion and Transmission at the same time, replacing G. G. Mattison, who retired after 47 years service, including nine years as a director.

Other Jt.1) Board action named Robert E. Fra-zer, Vice President-Finance in addition to his du-ties as Treasurer and Frank A. Jenkins, Vice Pres-ident ~Iransmission and Electric Installations, In October the Board named R. L. Dick, Vice President-Construction, replacing C. E. Watkins who retired after 43 years of service, and Joe S.

Major, Jr., Vice President-Personnel, replacing Kenneth Austin who retired after serving the Com-pany 37 years.

The average age of the Executive Committee of the Company is 47 years.

30

Duke Power Executive Staff l

Carl Horn. Jr.*

P*esident and Director 8 A . LL.B.4 uke university Attoreey (50/18) r-------*'-T------'~~~F---- --"---r----------r------'---1 f I i f f I

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4 k G.A.Coan R. E. Frazer

William H. Grigg* John D. Hicks

J. P. Lucas Jr. J. S. Major Vice President. Rates Vice Pressdent, Finance. Vice President and Vice President. Vice President. Public Vice President.

8 S.-Purdue and Treasurer General Counsel Corporate Attairs Relauona and Director Personnel University 8 S.--Centras Michigan A 8 . LL. B.4 uke and Director A.B.-Ouke University (51/34)

MecPenecal Engmeer University Universafy 8.S -U.S. Naval M.S.-N. C. State Professional Engmeer Certified Public Attorney Academy. Yale Law A.M.4rincetoft (63140) Accountant (39/9) Scnoce. LL.B. University

! (43/11) Attorney (63/32)

(46/15)

B. B. Parker

Executive Vice President. General Manager and Director 8.S.-University of North Caroline Electrical Engineer (57/36) l _

I i D. W. Booth

W. S. Lee

A. C. Thies*

Senior Vice President Senior Vice President Senior vice President ,

I Retail Ccoraticas Engineering & Production & i l and Director Construction Transmiasion <

8.S.-University of and Director and Director AlaDama B.S.- Priticeton B.S.-Georgia Tech ,

l E!ectrical Engineer Univemity Mechantcal Engsneer 1 (47/2C) Civil Engmeer (50/ 25) l

'uomoer of Esecutive' Committee #**'hfM"8'"**' g Figures en Parenthesis Denote Age and Longin of Service

e * ,

- r ,

~

Other Directors .

' f Acbert C. Edwards President.

Clemson University Richard B. Henney Trustee. Esecutive Director and Secretary Howard Holderness Chairman of the Board Jefferson Standard Herman W. Lay Chairinan of the Board PepssCo. inc.

Thomas L. Perkins o,,ec,or The Duke Eedomment Life lasurance Company oirector Chairman of theBoard Dan Rever,Inc. and Jetterson Psict Branitt International Souteern Regional Corporanon Third avational Bank Cnserman of the Trustees.

Tne Date Endomment Educa* ion Board Director of has%ville Counsel. Portuna. Federal Reserve Board of Burlington First National Bank Can.els & McCormack Richmond, Charlotte Branch Industrie s, Inc. of Dallas Directo, Carolina Teeechene & Soutneestern Life 1

American Cyanamed Telegraon Cefecany insurance Cornoany d *' sori Stancard Wilson Sportmg Company Bro'a"dcasting Company Goods Company Discount Corporation o Pia t Life o,f ne h,o.w Yo,rs insurance Company i uo er ,

Corporanon Morgan Guaranry Trust Company r & "+=orm y -

3 *as 3g @i

, s 1 . t 1, S - 4

~7 Z, bN -

1 h L s Marshall 1. Pickens D. W. Jones W. B. McGuire Chas. B. Wade. Jr.

Vice Chairman. Vice President Trustee Senior Vice President The Duke Endowment President, Soutneastern Duke Endowment R. J. Reynolds Tobacco Co.

Electric Enchange Chairman. National Electric '

Directo, Reliabdity Counen ,j,p,,, ,y,eacco Co J. P. Stevens & Co . Inc

. R. J.r R,e.yno,l_dsn-

.nd.s Re'.t'a', sus .r..

Other Officers C=

W. J. Bur ton r "a" v - -

~*c--g Assistaat vice President Pubhc Pelations

, *9%

L. P. Julian h'[,'h',*,'n Vice President , g g . 1 g 9 S T. Lattimore ~ (, *y w i k w

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Assistaat Vice President M h./

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Computer Services E. D. Powell f (h

Assistant vice President e Ftea'n Production g g % g ,

S F. Camntsell Assistant Treasurer R. L. Asbury F. W. Seyer Carl J. Blades R. L. Dick Steve C. Griffith, Jr.

J W. Law ence Controller Vice President Vice President Vice President Secretary and Assistant Treasurer B $ -Unnersity of System Planning Real Estate Construction Associate General Counsel Nortn Carolina B A, B E.E.-Ohio State M.F.F.-Michigan University B.C.E -N. C. State B.S --Clemson University W R Shmart University B.S Ag -Western MicNgan Universsty LL.B -U. of South Carolina Assistant Treasure, 166/46)

(56/21) University (44/22) (38/ 7)

R J. Ashmore (59/32)

Ass stant Controller P. A. Hauser Assistent Con!rciter J.F. Day %

@ f Arsistant Secretary , h J. C. Goodman. Jr.

Assistant Secreta y t l qq l J. S. Sesse e ,

Assistant Secretary , 9 --/ , , g ,

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~-. , .

,y . %-

, P. D. Huff Frank A.Jenkins W J. Wesley Lewis s ^s Henry H. Orr Warren H. Owen i Vice Pr=sident Vice President Vice President Vsce President Vice President i Distribution Engineering Transmission & District Operations Marketing Design Enomeering I B E E -Ciemson Electrical installations (56/34) (61/37) B M.E.-Clemson University B.E.E -N. C. State University (58/35) University (44/23)

(5t/33) .

Figures 6n Parenthesis 32 Denote Age and Longtn of Service I

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O DisTalCT OFFICE O saanCn orrect h sTEAa4 ILECtesC sTATtoN M MvDRCELECTatC STATION 0 ~uCu . eacTiiC sTATea Certase minor steem eseewie and hydroceectre plana omitted.

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