PRIVATE PROPERTY PUBLIC PURPOSE

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1 PRIVATE PROPERTY PUBLIC PURPOSE Understanding Right-of-Way Acquisition for Transmission Lines

2 At Progress Energy, we are committed to providing safe, reliable and affordable energy to our customers. As more people and industries move to Florida, Progress Energy must enhance the transmission and distribution network to help ensure a continuous, reliable flow of electricity to homes and businesses in the region. While reliable energy benefits everyone, we realize that the construction of new transmission lines can be unsettling. Understandably, you may have questions and concerns. We have developed this booklet to answer some frequently asked questions about our projects and our acquisition procedures. It also includes information about rights of way, easements, landowner compensation, construction and maintenance. If you have further questions after reviewing this material, please do not hesitate to contact us at or visit our Web site at progress-energy.com.

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4 Q. Who is Progress Energy? Progress Energy is a diversified energy company headquartered in Raleigh, N.C., with more than 24,000 megawatts of generation capacity. The company s holdings include two electric utilities serving more than 2.9 million customers in Florida, North Carolina and South Carolina. Progress Energy also includes nonregulated operations covering merchant generation, energy marketing, natural gas exploration and fuel extraction. Q. Is this transmission line really necessary? Yes. The growth in your community and the surrounding area requires Progress Energy Florida to build additional transmission lines to provide sufficient and reliable electrical service to its customers. Progress Energy Florida has a statutory duty to provide low-cost electric service within its territory. Q. How do you know when a new line is needed? Progress Energy continually monitors and forecasts the electrical needs of its customers. New equipment may be needed to serve growth in a specific area, or an analysis may identify potential problems that require improvements to the transmission system. The company plans 10 years into the future to allow sufficient time to identify, plan and implement new transmission equipment. Q. How was the final route selected? Why is my property being used instead of my neighbor s property? Progress Energy Florida has a very extensive process to determine the route of a transmission line, based on statutory criteria and input from the public and governmental agencies. Using this input, Progress Energy looks at a number of possible routes for the line, considering: the length of the line environmental impacts, including on wetlands, soil, vegetation and wildlife economics construction accessibility the distance from homes, businesses, historic sites and public facilities safety factors, including federal and state standards long-range planning and effectiveness alternate routes Progress Energy analyzes these and other factors to determine the best route for the transmission lines. Q. What is an easement? An easement is the right to use someone else s land. The property owner continues to own the land, but provides permission to use the land for a specific purpose. In the case of transmission lines, Progress Energy generally buys an easement to allow construction and maintenance of an overhead power line and associated communication equipment. The easement also permits trimming or removing of trees, including danger trees, which may come into contact with the line. Q. Which landowners will be approached about easements for the power line? Progress Energy will contact landowners along the proposed route where the transmission line will be built, where access will be needed or where trees could endanger the line. Q. When do negotiations with landowners begin? Negotiations begin after Progress Energy has selected a final route. Progress Energy will send a letter

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6 to affected landowners requesting an easement on their property. A Progress Energy representative will later contact the landowners to begin negotiations. Q. What gives Progress Energy the right to buy an easement on my property? The Florida Legislature has granted public utilities, such as Progress Energy, the right of eminent domain, which allows the company to buy easements needed to build equipment necessary to serve customers. This process is governed by Florida Statutes Section , Chapters 73 and 74. Q. Besides the poles, what other structures may be built within the easement? Depending on the specific location, Progress Energy may also install equipment needed to operate and maintain the transmission line, such as guy wires, anchors, electrical switches and communications equipment. Q. If I agree to this easement, will Progress Energy eventually put in a bigger transmission line or additional lines? At this time, Progress Energy does not have plans to build any transmission line larger than the one currently proposed. In the future, Progress Energy could increase the line to a higher voltage, add another circuit, or add distribution lines without needing to increase the size of the easement. Q. If I agree to this easement, will Progress Energy sell the rights to use the easement to another non-electric utility, such as a cellular phone company? No. Easements will only allow Progress Energy to build electrical lines and related equipment, and they cannot be used to build additional equipment for cellular towers, gas pipelines, or other non-electric utilities. Unless the easement gives Progress Energy the right to allow additional users to occupy the easement, those users must acquire their own separate easements from the property owner. Landowner Compensation Q. What is Progress Energy s policy for compensating landowners for the easements? Progress Energy buys permanent easements for transmission lines. Compensation to the property owner for the easement is based upon the difference in the value of the property before and after construction of the transmission line. Progress Energy then negotiates with the landowner to arrive at a fair price for the rights obtained in the easement. Q. How does Progress Energy pay the landowners for easements? Compensation for an easement is paid in one lump sum. Q. What happens if I cannot reach a settlement with Progress Energy? If the landowner and Progress Energy cannot agree to a settlement, then Progress Energy will use its power of eminent domain to obtain the easement, as set forth by state law. The court proceedings will then decide the compensation Progress Energy will pay the property owner for the easement.

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8 Restrictions, Maintenance and Construction Concerns Q. What should I anticipate during construction of a transmission line? While the on-site inspector will be a Progress Energy representative, independent contractors may clear rights of way and perform construction work. Progress Energy will make every attempt to notify the property owner before work begins. The process will include the following steps: Setting stakes for structure locations and boundaries for removing trees Installing erosion control devices Clearing easement area by equipment or by hand Removing any dangerous trees outside the easement area that could damage the structures or transmission line Installing transmission structures. After all structures are placed, overhead wires will be strung Replacing grass and other right-of-way restoration During right-of-way clearing and construction, Progress Energy will take necessary measures to control erosion. After construction is complete, additional restoration measures will be implemented, if needed, to restore permanent ground cover to control off-site erosion and sedimentation. Also during right-of-way clearing and construction, a Progress Energy inspector will oversee dayto-day activities. This person will report to the project manager and is responsible for minimizing impacts to property during clearing and construction. The inspector is responsible for ensuring: Compliance with contract and project specifications Compliance with regulatory requirements, such as sedimentation and erosion control Danger trees are removed after cutting Fences are restored, if they were temporarily removed Gates are properly closed Construction crews are courteous and professional at all times Landowners are not overly inconvenienced during the process Q. What happens to the trees that are cut from the easement? What about stumps and other debris? Typically, during the initial clearing process, Progress Energy removes trees and debris from the area to the extent possible given the land conditions. Stumps are cut below or as close as possible to the ground level. Progress Energy removes limbs from hand-cut and pruned trees in wetlands to avoid damaging the environment.

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10 Q. What is a danger tree? A danger tree is any tree that will endanger the operation of the transmission line if it falls. The danger tree designation depends on a number of factors, including a tree s species, height and distance from the transmission line. The chart below gives a general perspective for dangerous trees. Road Easement

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12 Q. What if my property is damaged during the clearing, construction, maintenance, or treeremoval process? Progress Energy will restore all damaged property if the landowner notifies the company of the damage. Q. Are there restrictions on my use of property in an easement? Yes. Progress Energy understands that landowners want to use the easement area for many purposes. Our goal is to work with landowners to encourage uses that are safe for the public and our employees, and that do not interfere with the reliable operation and maintenance of the line. Progress Energy must have unobstructed access to the easement to properly maintain the power lines, equipment and right of way. However, the landowner continues to own the property within the easement. For example, a property owner may be allowed to use an easement for things such as agriculture, grazing, parking lots, temporary storage and entrance crossings. Progress Energy s right of way use guidelines are online at: Q. Can I build a fence across or along the easement? Yes. A property owner can build a fence across or along the easement, if it includes a gate at least 16 feet wide to allow Progress Energy trucks access to the easement. Existing fences may remain in place, but Progress Energy may install a gate or temporarily remove the fence during construction or maintenance of the transmission line. Q. What maintenance can I expect on the transmission line? Except for emergency situations, a property owner can generally expect the transmission line to be patrolled by helicopter three times a year and patrolled by foot every five years. Trees encroaching in the right of way will be pruned at least every four years, and danger trees will be cut as needed. Trees in the easement that will reach a mature height of over 12 feet will be removed. Q. What routes can Progress Energy take across my property to access the easement? Under normal conditions, Progress Energy can access the easement by using the easement itself or any existing public road. If Progress Energy causes damage, the company will restore all damaged property if the landowner notifies Progress Energy of the damage.

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14 Miscellaneous Concerns Q. Is my health at risk because of the electromagnetic field surrounding the line? Progress Energy is committed to safe electrical service for its customers. Extremely low-frequency electric and magnetic fields (ELF-EMFs) are all around us not just in power lines but also electrical wiring in buildings, electric motors and appliances, TVs and computers. Florida is one of a few states with standards for transmission line electric fields and magnetic fields. Progress Energy complies with the Florida Environmental Regulation Commission rule of 1989, which limits the EMF produced from new transmission lines and substations. Numerous studies have been conducted in an attempt to discern the relationship, if any, between exposures to ELF-EMFs and human health. Some population or epidemiological studies have indicated that EMFs could pose, under some circumstances, a slightly elevated risk for developing certain type of diseases; other studies have found no such correlation. A May 1999 report by the National Institute of Environmental Health Sciences to the U.S. Congress concludes there is no evidence of correlation between EMF and adverse health effects. Progress Energy has provided both financial and technical support for ELF-EMF research and the company continues to monitor ongoing studies. Acting responsibly toward the environment is a vital part of our overall commitment to customers, investors, employees and neighbors. Customers with questions about ELF-EMFs can call the Customer Service Center at Q. Will the transmission line disrupt my satellite, cell phone, or radio reception? Generally, transmission lines do not affect reception by these devices.

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16 PRIVATE PROPERTY PUBLIC PURPOSE 2008 Progress Energy Florida, Inc SPA /08