DEI DG Bloomington Presentation

Duke Energy Indiana:Overview of Renewable Energy, Distributed Generation, Energy Storage and Electric VehiclesJuly 23, 20131AgendaDuke Energy offerings:

Net meteringQualifying Facility TariffGoGreen PowerEmerging Technology DepartmentElectric VehicleEnergy StorageCommercial Renewable Energy2Net Metering* by the Numbers Duke Energy Indiana207 current customers:18 schools157 residential32 commercialOf these, 51 were new in 2012 Current composition: 994 kW solar1305 kW windTotal = 2299 kWOf the 207 customers:176 solar31 wind

3* Rider No. 573Net Metering and Interconnection4Net Metering EligibilityInterconnection All customer classesRenewable energy sourcesNot more than 1 MWLocated on customers premisesConnected in parallel with the companys transmission or distribution systemUsed to offset all or part of a customers requirementsRolling credits for excess generation at retail rateApplication (Rider No. 80)Three levels of application (size-based)Electrical diagramUL certification of equipmentSite drawingInsuranceInspection

Qualifying Facility Tariff (Rider No. 50)Available to any customer2 options:Energy onlyCapacity and EnergyPayment is based on proscribed IURC avoided cost methodologyTariff is updated and approved by IURC annuallyCurrent tariff:$.028451/kWh$7.05/kW-month (dependent on capacity factor during on peak periods)

Under a separate tariff (No. 51- Parallel Operation of Customer Owned Generation), Duke Energy Indiana has the option to purchase generator output at a negotiated rate, subject to IURC approval55GoGreen Power Tariff (Rider No. 56)Gives customers the ability to support the development of green power sources throughout the state and the regionCustomers can purchase a minimum of two 100-kilowatt-hour (kWh) blocks of green power for $2 a monthPrice per block has over life of program been reduced from $2.50 to $2.00 and then to $1.00. Agreed with OUCC to further reduce to $0.90 in early 2014 if GoGreen revenues are sufficient. A 200 kWh commitmentequates to about 20 percent of an average residential customers electricity use helps to avoid 4,800 pounds of carbon dioxide emissions each yearAs of June 30, 2013:1,359 customers812,800 kWh per monthGoGreen not subsidized by non-participating customers66In Development - NC Green Tariff (Google)Responsive to customers desire for a green power rate (without having to actually own the assets)July commitment to file tariff applicationFiling for Duke Energy Carolinas NC characterized as a pilot offeringStructural elements of program to be included in filingProgram parameters under development:Customers on select rate schedules can participateNew and existing load eligible Per customer and aggregate program limitsStructure gives consideration to:Customer alternatives for Green EnergyHow best to position this initial filing to enable expansion to additional jurisdictions and additional customer classesSourcing from Duke Energy-owned resources and the market7Emerging Technology OfficeFuture Adv. NuclearTechnology CategoriesEmerging Technology Strategic Objectives

RenewablesEnergy Storage8WaterSmart GridClean CombustionElectric VehiclesTransformationalSupportiveIdentify and assess emerging technologies to evaluate opportunities for and threats to Duke Energys business modelShape technical and market development for new technologiesFacilitate technology adoption across impacted business units Technology assessment and development process +External engagement and leadership Establish Duke Energys public reputation as a leader in understanding, developing and applying technology in the utility industry Identify OpportunitiesYou may ask why is CTO performing this assessment. If you look at our strategic objectives, we are charged with working across multiple technologies to identify the opportunities and threats or risk that emerging technologies can bring to our business as we know it now. We work with the business units and the industry to maximize those opportunities and mitigate risk.

The assessment that we are presenting today is our first collective attempt to quantify the potential impact of new technologies. We do not have all the answers yet but we are seeing results that cause the analysis team to continue to ask questions, see potential impact to Duke Energys business and question how we can turn these risks into opportunities. The risk assessment results will be used in Swati Dajis annual risk assessment to the BOD and in the corporate planning strategic planning process. 8Project Plug-INPartially funded by DOEGoal: Deploy EV and Smart Grid related infrastructureNumerous partners involved throughout the State of Indiana9

Vehicle DataEVSE Data

Electric Vehicle Charging InfrastructureDuke Energy has installed:85 residential units10 units at state parks 10 units at Plainfield campus39 commercial unitsTotal: 144

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Energy Storage11Capital CostsO & M CostsInstallation HurdlesOperational IssuesValue StreamsThrough pilots we understandto developBusiness modelsRegulatory modelsUnderstand benefits

Clay Terrace Energy Storage SystemCarmel, INSystem attributesApplications being testedMajor system components: 75 kW / 42 kWh system capacity Toshiba lithium titanate battery 9.8 kW roof-mounted solarToshiba microEMS optimization Eaton 50 kW, Siemens 3.3 kW PEV charging stations Interconnection: Behind a commercial meter (customer sited) Interconnected at 208V, 3-phase transformer Located at Clay Terrace mall in Indianapolis1 active management of combined solar, storage and PEV charging (Micro-grid application) a) testing energy management system and sizing of a behind-the-meter system

2 Energy shifting

3- Renewable Smoothing

4 customer-sited installation aspects PEV DC Fast charging station50 kW Eaton unit10 kW solar roof-topBattery + Toshiba microEMS75 kW / 42 kWh Toshiba Li-TitinateLevel 2 PEV charging stationJ1772 up to 3.3 kW charging

12Notrees Wind Farm ProjectNotrees, TXApplications being tested:Major system components: 36 MW / 24 MWhXtreme Power Advanced Lead Acid Technology Co-located at site of 156 MW Wind Farm in Notrees, TexasBegan commercial operation in December 201250:50 Cost share with DOE Ancillary ServicesEnergy ShiftingAvoidance of Wind Curtailment

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McAlpine Energy Storage SystemMcAlpine Creek Retail Substation, Charlotte, NCSystem attributesApplications being testedMajor system components: 200 kW / 500 kWh system capacity BYD battery and inverter system All components integrated within on container Lithium-iron-phosphate battery (BYD) Interconnection: Located on a 24 kV distribution circuit Interconnected immediately outside of the substation Adjacent to 50 kW solar facility on McAlpine test circuit1 consolidated inverter/battery 2 energy shifting applications a) dispatched based on schedule, local load peaks, etc

3 integration with solar in a microgrid a) will be configured with switches, solar, and load to create an autonomous microgrid that disconnects from the circuit

4 solar output smoothing/firming Installation Sep - Oct 2012, In service 4Q 2012

BYD battery200 kW/500 kWh LiFePO4Inverter/ControlsIntegrated within one container Interconnected next to a 50 kW solar facility in a planned islandable micro-grid scheme that will use the battery for grid frequency/voltage regulation.

x14Community Scale Second Life BatteryUniversity of FloridaSystem attributesApplications being testedMajor system components: 24 kW / 30 kWh system capacity Li-ion batteries designed for use in a Chevy Volt 24 kVA inverter system ABB Interconnection: Located on a 120V/240V split single phase service At least one customer will be connected via the CES unit Specific customer TBD1 use of recycled electric vehicle batteries a) represents a potential low cost source of utility storage b) supports PEV economics

2 community-scale storage applications a) energy shifting b) islanding/back-up power c) automatic voltage control Planned installation in 2-3Q 2013

Inverter/Controls24 kVA capacity Will demonstrate a potential second-life battery application.

Increases residual value of PEVs and may provide low cost source of utility stationary storage.

Battery containerAbove ground

Li-Ion Chevy Volt batteries24 kW / 30 kWh15Duke Energy Commercial Renewables Portfolio Solar

Solar ProjectsState% OwnedInstalled Capacity (MW)Blue WingTX100%14Solar Star INC100%1TaylorsvilleNC100%1BagdadAZ100%15Solar Star IINC100%5RP OrlandoFL100%5Re AjoAZ100%4Martins CreekNC100%1Murphys Farm PowerNC100%1CS Murphy PointNC100%1NC Renewable PropertiesNC100%1Washington White PostNC100%12Black MountainAZ100%9Gato Montes AZ100%5Indu Solar Holdings (1)various50%7Total net-owned Installed Capacity82 MW

(1) Unconsolidated entities16Duke Energy Commercial Renewables Portfolio Wind

Wind ProjectsState% OwnedInstalled Capacity (MW)Sweetwater 1,2,3 (1)TX50%133Sweetwater 4,5 (1)TX47%151OcotilloTX100%59Happy JackWY100%29North AlleghenyPA100%70Notrees 1ATX100%91NoTrees 1B/1CTX100%62Silver SageWY100%42Campbell Hill / Three ButtesWY100%99Kit Carson / The BurlingtonCO100%51ShirleyWI100%20Top of the WorldWY100%200Cimarron / DS Cornerstone (1)KS50%66Laurel HillPA100%69Ironwood / DS Cornerstone (1)KS50%84Los Vientos ITX100%200Los Vientos IITX100%202Total net-owned Installed Capacity1,628 MW

(1) Unconsolidated entities1718