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Press Release

03/29/2012

Progress Energy Florida to convert Anclote Power Plant to cleaner natural gas

Emissions-reducing conversion will allow company to comply with new federal standards

ST. PETERSBURG, Fla. (March, 29, 2012) – Today, Progress Energy Florida announced plans to convert the Anclote Power Plant, located in Holiday, Fla., to 100 percent natural gas – a change that will reduce emissions dramatically at the plant.

Currently, the plant uses oil and natural gas. The change is required to allow the company to comply with new federal emission standards for coal- and oil-fired generating units, including the Environmental Protection Agency’s (EPA) new Mercury and Air Toxics Standards (MATS) rule.

The conversion will eliminate approximately 98 percent of the metals and approximately 99 percent of the sulfur dioxide (SO2) that the current units emit. Particulate emissions will be reduced by more than 90 percent.

The project is expected to cost approximately $79 million and will be completed in two phases, in mid- and late 2013. In addition to delivering environmental benefits, the conversion project will lower the cost of fuel for customers by approximately $268 million over five years.

“This investment is part of our ongoing commitment to our customers and the state to drive environmental improvements to our generation fleet,” said Vincent Dolan, president and CEO of Progress Energy Florida. “This is the latest in a series of projects to prepare our generation fleet to meet future energy needs in a cost-effective and environmentally responsible manner.”

In 2009, Progress Energy completed an $800 million project to repower its Bartow Power Plant in Pinellas County – a process that involved changing the plant’s primary fuel source from oil to natural gas. While both projects will result in reduced emissions, the Bartow repower project was different than the work planned at Anclote in that it also increased the plant’s generating capacity. In 2010, Progress Energy Florida completed an investment of $1.4 billion in state-of-the-art controls at its two largest coal-fired units (at the Crystal River Plant in Citrus County) to reduce sulfur dioxide (SO2) and nitrogen oxides (NOx) emissions by more than 97 percent and 93 percent, respectively, as compared to 2008 levels. These projects, and the planned Anclote Power Plant conversion, are all part of the company’s balanced solution to secure an energy future with safe and reliable service, affordable electricity and a cleaner environment. The balanced solution focuses on energy efficiency, alternative energy and a state-of-the-art power system.

The Anclote Power Plant, located near Holiday, Fla. in Pasco County, generates more than 1,000 megawatts (MW) from two steam units. The plant employs approximately 75 full-time staff to operate and maintain the facility.

Progress Energy Florida, a subsidiary of Progress Energy (NYSE: PGN), provides electricity and related services to more than 1.6 million customers in Florida. The company is headquartered in St. Petersburg, Fla., and serves a territory encompassing more than 20,000 square miles, including the cities of St. Petersburg and Clearwater, as well as the Central Florida area surrounding Orlando. Progress Energy Florida is pursuing a balanced approach to meeting the future energy needs of the region. That balance includes increased energy-efficiency programs, investments in renewable energy technologies and a state-of-the-art electricity system. For more information about Progress Energy, visit www.progress-energy.com.

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