Good afternoon and welcome to Duke Energy's 2025 Annual Meeting of Shareholders. I'm Abby Motsinger, Vice President of Investor Relations, and I'm pleased to welcome our shareholders and others who are joining us from around the world by webcast or via our toll-free number. Today's meeting is being recorded and will be available through our website shortly after the meeting. Here with me today is the independent chair of our board, Ted Craver, who will call the meeting to order. President and Chief Executive Officer Harry Sideris will then provide an update on the company, followed by a Q&A session. You may submit questions by selecting the Q&A button on the portal. Please be advised that today's discussion may include forward-looking information and the use of non-GAAP financial measures.
You should refer to the information contained in our 2024 Form 10-K and subsequent filings concerning factors that could cause future results to be different from this forward-looking information. A reconciliation of any non-GAAP financial measures can be found on the Investor Relations section of our website. Now, it is my pleasure to introduce Ted Craver.
Thank you, Abby, and good afternoon, everyone. Welcome to the 2025 Annual Meeting of Shareholders. We're hosting this meeting online, giving shareholders around the world the same opportunity to actively participate in the governance of Duke Energy. Legal notice of this meeting has been duly given. A quorum is present, and the meeting is now lawfully convened for the transaction of business. You should see a vote button on your computer screen. The polls are now open, and you can cast your ballot at any time. Again, let me welcome you to the meeting, and with that, the meeting will please come to order. Like all of you, our directors are participating online, along with our independent auditors, Deloitte & Touche. I'm joined here today by our President and CEO, Harry Sideris, who will be speaking to you later about our business.
In addition, Broadridge Financial Solutions has been appointed to act as inspector of elections. Jan Castillo from Broadridge is participating and has taken the oath of inspector of elections. Kodwo Ghartey-Tagoe is our Executive Vice President, Chief Legal Officer, and Corporate Secretary. Today, he is also acting as Secretary of this meeting. Kodwo will report the number of shares entitled to vote and the number of shares represented in person or by proxy at this meeting. Kodwo, let me turn it to you, please.
Thank you, Ted. As of the close of business on March 3, 2025, our record date, Duke Energy had outstanding and entitled to vote 777,021,683 shares of common stock. Each of those shares is entitled to one vote. Here represented by proxy, 656,296,150 shares of the company's common stock, which constitute approximately 84.46% of the total shares entitled to vote at this meeting. The final reports from the inspector of elections will include the votes of shareholders voting through the web portal.
Thank you, Kodwo. Let's proceed with the matters to be voted on. The first management proposal is the declassified board, which means that all of the directors stand for election every year at the annual meeting. Our elections also require nominees to receive a majority vote rather than a plurality to be elected. The nominees, whose bios begin on page 13 of the proxy statement, are presented for the purpose of voting for their election.
The nominees are Derek Burks, retired managing partner of Ernst & Young Indianapolis, Annette Clayton, retired chairwoman and chief executive officer of Schneider Electric North America, Rob Davis, chairman and chief executive officer of Merck, Carolyn Dorsa, retired executive vice president and chief financial officer of Public Service Enterprise Group, Roy Dunbar, retired chairman and chief executive officer of Network Solutions, Nick Fanandakis, retired executive vice president of DuPont, John Herron, retired president, chief executive officer, and chief nuclear officer of Exelon Nuclear,Idalene Kessner, dean emerita of Indiana University Kelley School of Business, Marie McKee, retired senior vice president of Corning, Mike Pacilio, retired executive vice president and chief operating officer of Exelon Generation, Harry Sideris, president and chief executive officer of Duke Energy, Tom Skains, retired chairman, president, and chief executive officer of Piedmont Natural Gas, and Bill Webster, retired executive vice president of the Institute of Nuclear Power Operations.
These nominees have been nominated for election as directors for one-year terms expiring in 2026. There are two additional management proposals being presented for approval. Proposal two, as shown on page 41 of the proxy statement, is the ratification of Deloitte & Touche as Duke Energy's independent registered public accounting firm for 2025. Proposal three, found on page 43 of the proxy statement, is a vote on an advisory basis to approve Duke Energy's named executive officer compensation. There are also two shareholder proposals that we have received for inclusion in the proxy, which Kodwo will introduce.
I would like to remind shareholders that the statements of the proponents are their own. They do not represent the views of Duke Energy. The first shareholder proposal, identified as Proposal Four in the proxy statement, beginning on page 81, relates to a request that the board of directors take each step necessary to amend our charter and bylaws to eliminate any supermajority voting requirement and also report on the expenses paid to proxy solicitors and other vendors in an effort to obtain the 80% approval requirement from all shares outstanding necessary to pass such a proposal. John Cheverden is the proponent. Mr. Cheverden, you can share your proposal now.
Hello, this is John Cheverden. Proposal four, simple majority vote. Charles requests that the Duke board take the necessary steps so that each voting requirement in the charter and bylaws that calls for a greater than simple majority vote be replaced by a requirement for a majority of the votes cast for and against such proposals or a simple majority. The Duke Energy board of directors put this important proposal topic on the 2022 Duke Annual Meeting ballot and failed by not a large margin to obtain the required 80% vote from all shares outstanding for the fourth time since 2012. This was because less than 80% of Duke's shares typically cast ballots, and there is an outdated requirement that this proposal topic must obtain an 80% vote from all Duke's shares outstanding.
The Duke Energy board of directors is apparently happy with the low Duke Energy shareholder vote turnout because there is no evidence in the text next to this proposal that Duke made an extra effort to encourage more Duke shareholders to vote in order to adopt this important proposal topic. This proposal is at least a reminder that there are limitations to any corporate governance improvements or increased shareholder rights that can be expected at Duke due to the current 80% approval requirements that are baked into the obsolete Duke governing documents and the Duke board of directors' lack of interest in getting more Duke shareholders to vote. This, in turn, negatively impacts the long-term performance that shareholders can expect from Duke stock. Current Duke shareholders may thus be wise to diversify away from Duke.
Shareholders are willing to pay a premium for shares of companies that have excellent corporate governance, but sadly, Duke is not such a company. Duke stock was at $97 in 2019 and at an unremarkable $121 now. Please vote yes, simple majority vote Proposal Four.
Thank you, Mr. Cheverden. Shareholder Proposal Five begins on page 83 of the proxy statement. It requests that Duke Energy report annually to shareholders on its net-zero-related activities and progress. Steve Malloy is acting as the proponent on behalf of Newground. Let's hear from him now.
Good afternoon, fellow shareholders. My name is Steve Malloy. I represent Newground, a 501(c)(3) not-for-profit organization focused on business education. Our proposal calls for management to audit its net-zero policies and commitments. Management opposes our proposal, calling it a waste of corporate resources, but it would be shocking if management has not already done such an audit. Net-zero is the policy of reducing net emissions of greenhouse gases to zero. While this may sound good to some, the reality is different. Net-zero has no basis in science or economics. Net-zero does not, cannot, and will not address American or global energy needs. Net-zero is an unfolding disaster around the world, and net-zero promoters and actors are being investigated by US and state governments for violations of law. As to science, putting aside what President Trump calls the climate hoax, even if the entire US
were to go net-zero today, more than 90% of global emissions would still occur. Regardless of climate science, net-zero commitments will accomplish nothing. As to economics, there is no place on this planet where so-called renewable energies have either improved the climate or weather or reduced electricity prices. In areas where wind and solar are used the most, prices are the highest. As to energy needs, mighty industrial nations like Germany and Britain have crippled themselves with net-zero. In America, we experience crippling inflation caused by the war on fossil fuels. The reality is that every part of our lives depends on fossil fuels, and that will not change for the foreseeable future. As to disasters, I already mentioned some of the economic disasters, but there is more. Hundreds of Texans died in February 2022 when the wind turbines froze.
Just this week, Spain and Portugal experienced a massive blackout caused and worsened by heavy reliance on wind and solar. US grid regulators now threat blackouts during peak demand because wind and solar can't be stepped up. Net-zero is making our grid unreliable. One day, there may very well be a mass casualty event because of net-zero policies. As to government investigations, banks, insurance companies, and investment firms have been forced to flee net-zero organizations because the organizations may be violating antitrust laws. The organizations seem to be illegal cartels forcing political agendas on the companies in which they own or manage stock. Management needs to seriously reconsider net-zero. It may say, "Oh, there's nothing to see here. Let's move on." We beg to differ. Net-zero is a management distraction that will only bring grief to shareholders, consumers, and our country. Please vote for Proposal Five, the net-zero audit.
Thank you.
Thank you, Mr. Malloy. That concludes our presentation of the proposals before us at the annual meeting. If you have not already voted your shares or if you'd like to change your vote, you may do so by clicking on the Vote-in button on the web portal and following the instructions there. The polls will remain open for the next several minutes until the Q&A session begins. I would now like to hand it over to Harry.
Thank you, Kodwo, and thank you all for joining us today. It is a pleasure to address you, our shareholders, for the first time as your CEO. Over the last several months, I've spent a significant amount of time with investors, customers, and teammates across our company, and these conversations reinforce the pivotal moment our industry is in. In my entire career, I have never seen more potential for growth and opportunity ahead of us than I do now, and we at Duke Energy are bringing a growth mindset to capitalize on these opportunities. Before we move to the voting results, I wanted to provide a brief business update on the year because 2024 was once again a year of excellent execution. We seized every opportunity to carry out our strategy, creating sustainable value, collaborating with stakeholders to achieve constructive solutions, and transforming and readying our system.
First is delivering value for our customers and shareholders, which means keeping reliability, resiliency, and affordability at the front and center. We increased our capital plan to $83 billion over the next five years, one of the largest regulated plans in the industry. This is to meet growing demand while we invested in innovative grid improvements to enhance reliability and resiliency, which helped avoid more than 2.3 million customer outages and more than 11 million hours of total outage time over the course of the year. We provided nearly $148 million in energy bill assistance, supporting over 210,000 households in need through our customer assistance programs like Share the Light Fund. We consistently work to transform the customer experience, including Piedmont's achievement of number one in customer satisfaction by J.D. Power for the third year in a row.
We continue to grow the company 5%-7% annually and pay a healthy dividend. Next, we also made strong progress working with federal and state and local stakeholders to advocate for regulatory mechanisms that we need to be successful on the path forward. We delivered constructive outcomes in four rate cases in the Carolinas, Florida, and Indiana. These rulings approved $45 billion of historic and future rate-based investments to create value for customers and shareholders. We advanced new generation through our integrated resource plans in North Carolina, South Carolina, Indiana, and Kentucky. Already this year, we filed our next round of natural gas plants in the Carolinas and Indiana. We have secured turbines and natural gas supply for each of these sites, expediting our ability to connect megawatts to support economic development growth.
Finally, we invested in new infrastructure, making great progress delivering on our diverse generation strategy to meet our customers' energy demands. We moved forward plans to add five gigawatts of new natural gas generation across our jurisdictions through 2029. We added 300 megawatts of solar in Florida last year, bringing the total to 1,500 megawatts in service in the state, and will bring an additional 900 megawatts online over the next three years. We increased energy storage with 55 megawatts added in 2024 and another 175 megawatts in construction, which are expected to begin operation this year. We partnered with TVA, GE Hitachi, and others in the industry to help advance emerging technologies, including small modular nuclear reactors.
All of our strategic progress in 2024 was underpinned by a strong foundation and track record of safety and operational excellence, including our response to the most significant hurricane season we have ever experienced in our company's history. I am so proud of how our crews and entire company responded to 5.5 million outages in some of the harshest conditions, restoring our customers as quickly and safely as possible and helping our communities recover. Our success in responding to storms of this magnitude was due to the tireless work of our employees and utility partners and near-constant communication with customers and stakeholders, and also our strategic preparation. These efforts included increasing collaboration with state, local, and federal officials and investing more than $10 billion in grid resiliency and storm hardening across our jurisdictions over the last three years. We enter 2025 in a position of strength.
We have a simplified business model, a solid business strategy, a modernized regulatory construct, excellence in safety and operations, and a laser focus on providing value. Underscoring it all is our highly skilled and innovative workforce. The path forward is clear as we navigate this decade of record infrastructure build and load growth. We remain focused on delivering value to our shareholders while meeting our customers' energy demands now and into the future. I will now turn it back over to Ted.
Thank you, Harry. The polls are now closed. Kodwo, please provide the inspector of elections report before we answer questions.
Thank you, Ted. Based on the proxies received, each nominee for director has been elected by over 93% of the votes cast. The ratification of Deloitte & Touche as Duke Energy's independent registered public accounting firm for 2025 has been approved with approximately 96% of the shares represented. The advisory vote on our named executive officer compensation has been approved, receiving support of approximately 93% of the shares represented. Shareholder Proposal Four, regarding a request to support a simple majority vote, has been approved, receiving support of approximately 98% of the shares represented. Finally, Shareholder Proposal Five, requesting that Duke Energy report annually to shareholders on its net-zero-related activities and progress, has failed, receiving support of approximately 2% of the vote.
Thank you, Kodwo. The final reports of the inspector of elections are ordered to be filed with the minutes of this meeting. The meeting is adjourned, and now we'd like to answer some of your questions. Abby, I'll turn it over to you, please.
Thanks, Ted. For the past several weeks, we've invited our shareholders to submit questions in advance, but we also welcome you to submit any questions you have during the meeting as well. It's important that your voices are heard, and we value your engagement, so I'm going to read the questions exactly as you submitted them. All of the questions. Now, we've received a number of questions in advance on a variety of topics. Why don't we dive right in with a question here on the dividend? This shareholder asks, "When will be the next dividend increase?
Thank you, Abby, for that question. We know how important the dividend is to our investors, and we're committed to growing it. We last increased our dividend last July, and that marked the 20th consecutive year that we increased our dividend. We've paid a dividend for 99 consecutive years. We will be assessing what the appropriate increase is each year, and of course, those decisions related to the dividend are always subject to our board of directors' approval. Historically, our dividend increases have happened around the third quarter.
Thank you, Harry. Okay, our second question here is related to our stock price and thoughts on splitting the stock. This shareholder asks, "Is there any plans for a stock split in the near future?
We evaluate this periodically, but we don't have any plans right now to initiate a stock split. Over the last six months, our stock has been priced anywhere from $100 to $120 per share, which compared to many other stocks, we believe, is relatively affordable for small investors, but we will continue to evaluate this over time to see if it makes sense.
Okay, thanks. Okay, moving on, our next question is from an investor, appears to also be a customer. This shareholder asks, "Why is Duke Energy repeatedly asking the Ohio Public Utilities Commission for price increases when the service at times is very questionable?
We recognize that the two most important things our customers are focused on are affordability and reliability, and those are the two things that we focus on as we look to invest in our grid and modernize our energy infrastructure to serve our customers. We have been making substantial investments. Nearly half of our five-year capital plan goes to building a more reliable and resilient grid. In Ohio, we have done a lot of targeted investments around smart technology, self-healing technology, substation upgrades, which have enhanced our reliability, but also support the region's continued growth in Ohio. Duke Energy Ohio continues to hold its operation and maintenance costs nearly flat each year, and we always strive to keep our customer rates as low as possible with moving forward with these system increases. I am pleased to report that all our residential rates across all our regions are below the national average.
Okay, thank you, Harry. Okay, next few questions here are about the board of directors. This investor asks, "Why are almost 50% of your board members on two to three other boards, many of which have no connection to Duke, like Oshkosh, appear to be professional board members more focused on the task at hand Duke Energy would make for an even better product?
Okay, I think to start out with, I would say I feel very proud of the directors that we have here at Duke Energy. We have 13 independent directors, and those directors have a wide mix of skills, talents, experiences, and backgrounds. In terms of the board piece, we have several members of our board of directors that are very much involved in the industry. They have been for pretty much their entire career. That provides, I think, good continuity in terms of understanding how Duke Energy fits within the industry and how we can move the company forward. We also have a number of directors that do not have utility backgrounds in their experience. We think this actually enriches our deliberations. We have directors that bring other experiences from other industries, other regions within the country. We actually think having directors that are on other boards brings best practices from other companies to our board in areas like good governance, capital management, technology, also from other regions within the country. We actually think it helps enrich our deliberations and enrich the efforts of the board towards good governance and making sure that the company is profitable.
Thank you, Ted. That's helpful. Okay, the next question actually is about the size of the board of directors. This shareholder asks, "Given the size of Duke, why is it necessary to have so many members on the board of directors?
Good question. Maybe start with a few bits of data. The S&P 500 companies have, on average, a little over 11 directors. Also, in our industry, it tends to be 12 to 13 as the average. We have 13 independent directors currently. Our corporate governance guidelines provide for a range of 12 to 16 directors, so we're basically in line with the corporate governance guidelines. I think we feel that given the complexity of the company and the fact that we are in a critical infrastructure business, we have special considerations around public safety, around operating safety, public policy issues, and we're in several different jurisdictions. All of that, we feel we need to bring a wider mix of experiences from our directors.
The final piece that I think I would bring to the table on this, we'll continue to look at this over time, but I think shareholders should expect that we'll remain somewhere in this kind of 12 to16 number, particularly given the size of the nuclear fleet that we have. We have the largest regulated nuclear fleet, and three of our directors have spent their entire career involved in nuclear operations and nuclear safety. All of this, I think, works well for us and should expect somewhere in that 12 to 16 number.
Very good. Okay, our final question related to the board is on board comp, board executive comp, and really how we're funding that. This investor asks, "Why do we give shares to executives and directors, pay them and allow them to purchase shares at a reduced rate, 75% to 85% of the current price, and require them to hold the shares for a specified period of time depending on the discount? Giving away shares that are created for such use diminishes the equity and voting power of each shareholder. All shares used for such purposes should be purchased by the company on the open market.
Okay, I think I actually hear kind of two questions in there. The first one is around director compensation and how is that determined. We look at really wanting our directors to be compensated on what I would call a market competitive basis. In order to determine that, we look at other companies, S&P 500 companies, companies within our industry, and our whole goal there is to structure the pay as well as the amount of compensation to be market competitive. The mix between cash and stock, that really universally across public companies is a mix of roughly 50/50, maybe 40/60, sometimes 55/45, but basically around that 50/50 level, and that's what we have as well.
I think investors make it clear that they want to see that directors have skin in the game, that some of their compensation rises and falls with the stock price just like theirs does. Having equity as a component of the compensation is very important. The second part of the question that I hear there is really around the point of dilution. If you issue the shares, new shares to the directors, then that'll have somewhat of a dilutive effect, whereas if you buy them in the open market, it does not have a dilutive effect. We've done both in the past. We currently are issuing new shares that we provide directors, and part of that is because of the growth rate that Harry talked about.
We have a significant amount of capital that needs to be raised and equity that needs to be raised, which we are in the process of doing. In terms of the diluted effect, a company with $95 billion market cap, as Duke Energy has, the dilution effect is actually de minimis.
Okay, thank you, Ted. This next question is on retiree compensation, actually. This shareholder asks, "I believe the board of directors as well as upper management should be compensated at the reasonable compensation reflected in the reports provided. It would be much appreciated if the board of directors would consider at least review the compensation provided to those who are currently receiving retirement benefits. With current inflation, it would be helpful to receive an increase in benefits. Thank you for your consideration.
Thanks, Abby, for that question. I wanted to start off by thanking you and all the other Duke Energy retirees for everything you've done for our company in the past, serving our communities, and the dedication and commitment over many decades is greatly appreciated. It's true that our retirement benefits we provide are not adjusted for inflation, but they're also not intended to provide all the retirement income that a retiree has. What I would suggest is the Duke Energy retirement benefit should be viewed as a part of a portfolio of assets that places retirees in a good place financially to live throughout retirement.
We strongly encourage financial planning to our employees, and we make special tools to help them with retiring and financial coaching resources so that they can better prepare for this time in their lives and that next chapter in their lives to make sure that they will have what they need in the future. Again, I really respect all the work that our retirees have done for the company over a long period of time. They truly have set the foundation for our company's future.
Thank you, Harry. This is another retiree investor question. This shareholder asks, "Why was the program providing matching funds given by retirees to approved nonprofits eliminated?
It's a good question. As with any company, we constantly are looking for ways to streamline our operations, looking at our assets, what's in the best interest of our customers, investors, and other stakeholders. Our company remains committed to supporting our communities, and the Duke Energy Foundation does a tremendous job of supporting our neighbors and nonprofits in each of the states, even beyond the former retiree offerings that we had. Just last year, Duke Energy Foundation donated more than $37 million to support our communities. A lot of that went to the communities that were devastated by the hurricanes that we had last year. Very important to support the communities, and we'll look to continue to help our communities prosper in the future.
Very good. Okay, another question we received relates to diversity and inclusion, and just a reminder that I'm reading these questions word for word as they were submitted. This shareholder asks, "Will you please stop all DEI activities and fire all DEI function workers?
Thank you for your feedback. We respect that there's a lot of differing viewpoints on this social issue, but I wanted to share today my perspective and Duke Energy's longstanding view on diversity and inclusion. First and foremost, our employment decisions have always been and still are based on skills, experience, capabilities, and performance. Anyone who's a Duke Energy employee today has been through a rigorous process to join us and will help our company achieve our goals in the future. It is also our experience that building a diverse workforce with different perspectives and experiences, as well as creating an inclusive workplace, makes a strong advantage, ultimately benefiting our employees and the customers we serve. We understand and value that everyone has with the applicable laws and governmental requirements at the federal and state levels.
Okay, thank you, Harry. Shifting gears a bit, this next question relates to our climate goals and customer affordability, frankly. This investor asks, "I would like to know how management will proceed if it determines that reaching net zero by 2050 is unreasonably expensive in terms of capital expenditures and/or rates needed to be charged to customers?
Thanks, Abby. That's a great question. Our long-term strategy has always been guided by reliability and affordability for our customers while helping meet the growing population and economic development that we are seeing in our states. We will continue to focus on that and look for diverse sets of resources to do that. Our focus on deploying more modern and modernizing our system with new infrastructure will not only meet those customers' demands, but it would also reduce emissions over time. We know that we need to stay flexible, and this is a fluid and flexible situation, and we'll continue to look at that. We fully support our strategy of all of the above, which includes both proven technologies such as natural gas, nuclear, and renewables, as well as continuing to work on those new emerging technologies that will help us in the future. We will continue to focus on reliability and affordability while we meet our customers' demands.
All right, very good. Okay, our last question here, you mentioned nuclear, Harry. This is about nuclear as well. This shareholder asks, "How does nuclear power fit in with zero-carbon energy generation and profitability?
That's a great question too, Abby. I love talking about our nuclear facilities because nuclear plays such a vital role in our company and in the Carolinas. We have 11 reactors, the largest regulated fleet, like Ted mentioned earlier, in the nation. Those 11 reactors provide safe, affordable, reliable energy to our customers. They also do it carbon-free. These resources are low cost. They run 95% of the time, providing over 50% of the energy needs for the Carolinas. This is a very important asset that we have. It's also our lowest cost generation asset that we have, so it helps us maintain the affordability for our customers. We continue to focus on what we can do to extend the lives of these nuclear plants to continue to run them in the future because they play a very vital role to the future.
Like I said, their costs are the lowest of any of our generation assets, so they continue to help our customers. They also help our customers with the great operations that we have in nuclear. We're able to achieve nuclear production tax credits under the Inflation Reduction Act. Last year, we earned $500 million of these tax credits. These go back to our customer dollar for dollar, helping reduce our customers' bill in the future. We continue to operate our nuclear plants with safety and reliability in mind so that we can continue to provide that affordable energy to our customers. Nuclear is going to play a vital role in our future as we continue to serve our customers.
Okay, very good. This concludes our Q&A session. Harry, I'll turn it to you to wrap things up.
Again, thank you all for joining us today. As a reminder, we're going to post your questions and answers to the Duke Energy website. Again, thank you for your investment in Duke Energy, and have a great afternoon.