Progress Energy 2004 Annual Report Download - page 98

Geographic Data
21. OTHER INCOME AND OTHER EXPENSE
Other income and expense includes interest income,
impairment of investments and other income and
expense items as discussed below. The components of
other, net as shown on the Consolidated Statements of
Income for the years ended December 31 are as follows:
Nonregulated energy and delivery services include
power protection services and mass market programs
(surge protection, appliance services and area light
sales) and delivery, transmission and substation work for
other utilities.
22. ENVIRONMENTAL MATTERS
The Company is subject to federal, state and local
regulations addressing hazardous and solid waste
management, air and water quality and other
environmental matters.
Hazardous and Solid Waste Management
The provisions of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as
amended (CERCLA), authorize the EPA to require the
cleanup of hazardous waste sites. This statute imposes
retroactive joint and several liabilities. Some states,
including North and South Carolina, have similar types of
legislation. The Company and its subsidiaries are
periodically notified by regulators including the EPA and
various state agencies of their involvement or potential
involvement in sites that may require investigation and/or
remediation. There are presently several sites with
respect to which the Company has been notified by the
EPA, the State of North Carolina or the State of Florida of
its potential liability, as described below in greater detail.
The Company also is currently in the process of
assessing potential costs and exposures at other sites.
For all sites, as assessments are developed and
analyzed, the Company will accrue costs for the sites to
the extent the costs are probable and can be reasonably
estimated. A discussion of sites by legal entity follows.
Various organic materials associated with the production
of manufactured gas, generally referred to as coal tar,
are regulated under federal and state laws. PEC and PEF
are each potentially responsible parties (PRPs) at several
manufactured gas plant (MGP) sites.
PEC, PEF and Progress Fuels Corporation have filed
claims with the Company’s general liability insurance
carriers to recover costs arising from actual or potential
environmental liabilities. Some claims have been settled
and others are still pending. While the Company cannot
predict the outcome of these matters, the outcome is not
expected to have a material effect on the consolidated
financial position or results of operations.
PEC
There are nine former MGP sites and a number of other sites
associated with PEC that have required or are anticipated
to require investigation and/or remediation costs.
During the fourth quarter of 2004, the EPA advised PEC
that it had been identified as a PRP at the Ward
Transformer site located in Raleigh, North Carolina. The
EPA offered PEC and 34 other PRPs the opportunity to
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Notes to Consolidated Financial Statements
(in millions) 2004 2003 2002
Other Income
Nonregulated energy and
delivery services income $32 $27 $33
DIG Issue C20 amortization (Note 18A) 9 2 –
Contingent value obligation
unrealized gain (Note 16) 9–28
Investment gains –5–
AFUDC equity 11 14 8
Gain on sale of property and
partnership investments 12 25 12
Other 34 17 42
Total other income $107 $90 $123
Other Expense
Nonregulated energy and
delivery services expenses $20 $20 $29
Donations 10 12 19
Investment losses 6––
Contingent value obligation
unrealized loss (Note 16) –9–
Loss from equity investments 640 21
Loss on debt extinguishment and
interest rate collars (Note 13D) 15 ––
Other 42 25 27
Total other expense $99 $106 $96
Other, net $8 $(16) $27
(in millions) U.S. Canada Mexico Consolidated
2004
Consolidated revenues $9,644 $112 $16 $9,772
2003
Consolidated revenues $8,624 $103 $14 $8,741
2002
Consolidated revenues $7,984 $93 $14 $8,091