8-KMaterial Agreements

Duke Energy CORP 8-K Report, Material Agreement (May 18, 2006)

Filed May 18, 2006For Securities:DUKDUKBDUK-PA

Summary

Duke Energy Corporation, through its wholly-owned subsidiary Duke Energy Carolinas, LLC, announced on May 12, 2006, the execution of material definitive agreements with three electric membership corporations: Piedmont Electric Membership Corporation, Rutherford Electric Membership Corporation, and Blue Ridge Electric Membership Corporation. These agreements are set to commence on September 1, 2006, and will run through December 31, 2021, establishing Duke Energy Carolinas as a provider of wholesale electricity and related power scheduling services. The core of these agreements involves Duke Energy Carolinas selling capacity and energy to meet the native load requirements of each cooperative, excluding resources they already possess. The contracted sales are designed to be firm, comparable to Duke Energy Carolinas' own native load commitments. The successful implementation of these agreements is contingent upon obtaining necessary regulatory approvals and satisfying other conditions precedent.

Key Highlights

  • 1Duke Energy Carolinas, a subsidiary of Duke Energy, entered into a material definitive agreement with three electric membership corporations.
  • 2The agreements cover the provision of wholesale electricity and power scheduling services.
  • 3The term of the agreements is from September 1, 2006, to December 31, 2021.
  • 4Duke Energy Carolinas will supply capacity and energy to meet the native load requirements of the cooperatives.
  • 5The sales commitment is firm and equivalent to Duke Energy Carolinas' native load requirements.
  • 6The agreements are subject to regulatory approvals and other customary closing conditions.

Frequently Asked Questions

The primary purpose of the agreements is for Duke Energy Carolinas, a subsidiary of Duke Energy, to provide wholesale electricity and related power scheduling services to three electric membership corporations (Piedmont EMC, Rutherford EMC, and Blue Ridge EMC) over a long-term period.

The agreements are set to become effective on September 1, 2006, and will continue until December 31, 2021.

The agreements are contingent upon receiving the necessary regulatory approvals and the satisfaction of other conditions precedent.

Duke Energy Carolinas will be selling capacity and energy to the cooperatives to fulfill their native load requirements that are not met by their existing resources. The firmness of these sales is equivalent to Duke Energy Carolinas' own native load obligations.