1. COMMISSIONER SUSAN W. RABON NORTH CAROLINA UTILITIES COMMISSION
SEARUC REGION
COMMISSIONER SUSAN W. RABON
NORTH CAROLINA UTILITIES COMMISSION

2. SEARUC OVERVIEW OF THE REGION
SEARUC is a large, diverse area -- Runs from NC south to FL; Puerto Rico west to AR & TX Electricity is the main home-heating fuel in SEARUC -- 62% average market share - 58% excluding FL & Puerto Rico -- 23% market share in the rest of the US Gas home-heating share fell from 2000 to 2010 Use of gas for electric generation varied by state -- 62% in FL, 2% in KY in 2011 Gas production varied by state TCF in Texas in 2010, none in 3 states and Puerto Rico

3. ELECTRIC HOME-HEATING MARKET SHARE 2010 U.S. CENSUS

4. NATURAL GAS HOME-HEATING MARKET SHARE 2000 v. 2010 U.S. CENSUS

5. PERCENTAGE OF ELECTRICITY GENERATED WITH GAS Source: U. S
PERCENTAGE OF ELECTRICITY GENERATED WITH GAS Source: U.S. ENERGY INFORMATION ADMINISTRATION – 2011 Data

6. 2010 PRODUCTION OF NATURAL GAS (Billions of Cubic Feet) Source: U. S
2010 PRODUCTION OF NATURAL GAS (Billions of Cubic Feet) Source: U.S. ENERGY INFORMATION ADMINISTRATION

7. NORTH CAROLINA GAS-ELECTRIC INTERDEPENDABILITY & RELIABILITY
Opened a docket in response to the FERC/NERC Southwest Report No NC gas production - no well freeze-off / processing plant issues in-state Limited issues with electric compression -- One LDC electric compressor station serves a power plant -- 16% of Transco’s mainline compression is electric Gas-fired generation capacity is growing from small base NC generators take steps to firm up fuel supply -- NCUC requires some fuel-oil backup at gas-fired generators -- NC generators are signing up for firm interstate pipeline capacity

8. NORTH CAROLINA EFFICIENCY EFFORTS
NC General Assembly passed a law allowing decoupling
- G.S
“Decouples” margin recovery from average customer usage
-- LDC not punished for promoting efficiency & conservation
Major LDCs have decoupling mechanisms in rates
LDCs have programs to promote efficiency
-- weatherization, energy audits
-- efficient appliances

9. NORTH CAROLINA ESCALATING CAPITAL EXPENDITURES
Major LDC transmission lines needed to serve generating plants New customer additions -- industrial plants are requesting lines -- low gas prices should encourage residential & commercial additions No cast iron or bare steel main left in NC -- a steady, long-term effort Other safety-mandated expenditures (e.g.: remote, automatic valves) -- a bill has been drafted to allow for pass-through of safety CAPEX - has not been introduced - NCUC has allowed special recovery of safety expenses

10. Support Charts

11. PERCENTAGE OF ELECTRICITY GENERATED WITH COAL Source: U. S
PERCENTAGE OF ELECTRICITY GENERATED WITH COAL Source: U.S. ENERGY INFORMATION ADMINISTRATION

12. PERCENTAGE OF ELECTRICITY GENERATED WITH NUKES Source: U. S
PERCENTAGE OF ELECTRICITY GENERATED WITH NUKES Source: U.S. ENERGY INFORMATION ADMINISTRATION

13. PERCENTAGE OF ELECTRICITY GENERATED BY FUEL Source: U. S
PERCENTAGE OF ELECTRICITY GENERATED BY FUEL Source: U.S. ENERGY INFORMATION ADMINISTRATION
Gas
Coal
Nuclear
Other Sources
2011
2010 NC 9% 7%
51%
56%
34%
32% 5% 6% AL
31%
26%
36%
41%
25% 8% AR
21%
20%
48%
46%
23% FL
62%
10% 4% GA
17%
53%
24% KY 2%
93% 0% LA
50%
16%
18% MS
58%
54%
19% 3% SC
12%
33% TN TX
45%
SEARUC
35%
40%
42%

14. NATURAL GAS HOME-HEATING MARKET SHARE 2000 v. 2010 U.S. CENSUS
CHANGE
GEORGIA
49%
41%
-8%
ARKANSAS
-7%
LOUISIANA
47%
37%
-10%
KENTUCKY
44%
39%
-5%
TEXAS
43%
38%
ALABAMA
31%
MISSISSIPPI
32%
TENNESSEE
36%
34%
-2%
SOUTH CAROLINA
26%
24%
-3%
FLORIDA 6% 5%
-1%
PUERTO RICO 0%
NORTH CAROLINA
25% 1%