Duke Energy Corporation DUK
Q4 2011 Earnings Call Transcript

Operator: Daniel Eggers, Credit Suisse.

Daniel Eggers - Credit Suisse: Jim, can you just talk a little bit more about how you see the timeline working on once you file the statement with North Carolina on the remediation plan? You've 30 days and then it goes to FERC. How would you see that playing through best case scenario to get into a point of resolution on the merger?

James E. Rogers - Chairman, President and CEO: Dan, my judgment is that we've actually spent almost two months trying to finalize our analysis in the FERC order and the development of this revised mitigation plan. This has proved to be a very complex analysis and we've really worked to try to address the concerns of the FERC, and at the same time address the concerns of our state commissions and in many instances we're really trying to thread the needle between federal and state policy. In terms of how to play out, I'm almost reluctant to predict the timeline given what has happened in the past, but I think a best case scenario is that the North Carolina Commission will review for 30 days and maybe take a shorter period of time to review it, and then we will file with the FERC and then the FERC will take 30 days for comment from the various parties, and then they will deliberate roughly 30 days and then issue our order approving the merger, along with a joint approval of our joint dispatch agreement as well as our tariff. So you can see that the timeline plays out by late May, June. I would say mid to late May, we'd in all likelihood have an order from the FERC and then we expect orders from the state commissions of North and South Carolina after they've had an opportunity to review the FERC order and the issues that are pending before them.

Daniel Eggers - Credit Suisse: I'm going to ask relatively impolite questions, so I apologize in advance, but given the fact that you guys have been able to put up better numbers and maintain your growth rate while Progress' numbers have, I guess, deteriorated expectation wise from when the deal was struck. Is that causing you or the Board to have any reconsideration on the overall value of the transfer or the acquisition, I guess?

James E. Rogers - Chairman, President and CEO: Well, we consider – we continue to look at the performance of Progress. They've had a few issues in Florida that they seem to be working through. I think the important point here is, is you have to look at this deal both in the short and the long term, and we continue to analyze their performance. Over time, we will – we're on a path to get approval of this. So, again, more work to do, more information to gain as we move through the process.

Operator: Greg Gordon, ISI Group.

Greg Gordon - International Strategy & Investment Group: Kind of a question along the same line as that. As I look at the 4% to 6% earnings growth aspiration and I think about it in the context of the merger presuming we reconcile these issues with the FERC and the states, I have two questions regarding what your assumptions are in that 46% aspiration. One is, does it presume that your earned returns in the Carolinas, Indiana, Ohio and Kentucky accrete to your authorized levels through synergies? Is that sort of one of the critical pads to get into that range? Second, are you making any contingency assumptions in that range with regard to a negative outcome on Edwardsport and for that matter, a negative outcome on Crystal River on the Progress Energy side, in terms of write-offs and balance sheet impact?