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Rating Research Survey Reveals Duke Energy and Southern Company are Industry's Reputation Leaders

Bedminster, N.J. (July 23, 2002) - North Carolina-based Duke Energy Corporation and The Southern Company, headquartered in Georgia, emerge as the reputation winners in a new survey of the electric power industry released today and conducted by Rating Research LLC (RRC), a firm specializing in the assessment of reputation. Each receive a AA Reputation Rating, RRC's second highest possible rating.

The survey findings, detailed in the August Issue of Platts Energy Business & Technology magazine, reveal that both senior executives and financial analysts are highly favorable towards Duke Energy. Almost 70% of executive respondents consider Duke Energy to be an overall "excellent company," while close to 90% of analysts say the same.

"The survey data suggests there is a sufficient cushion of support for Duke Energy to enable them to weather the current concerns regarding their energy trading operation, " says Dory Gasorek, RRC's Chair, Rating Committee. "However, a prolonged or highly controversial situation could impact their status as the industry's reputation leader."

PG&E is Industry Laggard, Receives Lowest Reputation Rating

PG&E Corporation of California is the industry reputation laggard and receives the lowest Reputation Rating CCC among the 21 companies that were the focus of the survey. PG&E filed for bankruptcy last year, bowing to the same pressures resulting from the state's energy crisis that beset another California power company, Edison International, also included in the survey and rated BBB.

"PG&E adopted a more confrontational stance with respect to the state and its regulatory agencies, "explains Ms. Gasorek. "This may partially explain its stunningly low Reputation Strength Score, a composite of its scores on the components surveyed. Compare this to Edison International which, overtime, has built up a strong reputational foundation that appears to have helped it weather this storm to date."

The RRC Electric Power Reputation survey included in-depth telephone interviews with senior industry executives and financial analysts who state they follow the electric power industry. Leading companies are analyzed on a series of reputation dimensions. The Reputation Rating is based on both qualitative and quantitative input emerging from the research as well as the industry expertise amongst the Rating Committee members. The interviews took place in first quarter of this year.

Opinion Gap Between Analysts and Industry Executives

Although Duke Energy is the favorite of both analysts and senior industry executives, there are considerable differences of opinion between these two groups on other rated companies in the survey. In addition to Duke Energy, analysts view Dominion Resources, (Virginia), Entergy Corporation (Louisiana), and Southern most highly on the measure "Perception as an Excellent Company", as compared to executives who score FPL Group, Incorporated (Florida), Cinergy Corporation (Ohio) and TXU (Texas) at the top, in addition to Duke Energy.

"However, it's interesting to note that executives do not give any company a score over 70% 'as an excellent company,'" notes Ms. Gasorek. "This reinforces the lower reputation scores in electric power versus other industries RRC has surveyed, suggesting there is a self-esteem issue here, even among industry executives."

Surprisingly, Entergy ranks 19th out of 21 companies as an "excellent company" among executives but scores exceptionally well among analysts. Similarly, Dominion is in the bottom half of the industry in the executive survey, but is viewed well by analysts. This divergence of opinion is seen again on the important measure of "Personally Willing to Invest In." Duke Energy appears near the top of the list for both analysts and executives. However, analysts' other top choices include Dominion and FPL Group, while executives select Southern, TXU and Xcel Energy.

Marketing Effectiveness is Critical Dimension within Changing Energy Market

Duke Energy and Southern score highly on Marketing Effectiveness, a leading indicator of strong future financial and operating performance in changing energy markets. Duke Energy and Southern receive 65% and 63%, respectively from executives, while FPL Group comes in third with 57%.

Another key dimension is Organizational Culture/Ethics that measures trustworthiness, openness and honesty, as well as community involvement and customer service. According to Ms. Gasorek, "This is a very important dimension, particularly in terms of dealing with external constituencies, such as regulators and customers." Here again, Duke Energy, Southern and FPL Group are the winners.

FLP Group, Xcel Energy and Progress Energy Score High on Environmental Focus

Given that the electric power industry is consistently fraught with public controversy on issues as diverse as the safety of nuclear plants and the impact of acid rain created by coal-fired plants, Environmental Focus is an important reputational dimension in the industry. Interestingly, the top scorers in the overall survey - Duke Energy and Southern - do not lead the list on environment. Rather, FPL Group, Xcel Energy and Progress Energy, headquartered in North Carolina, are the front-runners here.

"Power companies perceived to have a good safety record and to be conscious of environmental concerns have an advantage in dealing with the political and public relations aspects of these issues, " comments Ms. Gasorek.

RRC, a joint venture between The Ratrix Group and Opinion Research Corporation (NASDAQ: ORCI) provides research and opinion on reputation. RRC assigns corporate reputation ratings to the leading companies in each industry surveyed and publishes these ratings for use by interested third parties.

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For more information on the Electric Power Survey, part of Rating Research LLC's Reputation Series, call 908-470-1260 or visit www.ratingresearch.com.