Exhibit 10c(29)


                              EMPLOYMENT AGREEMENT

                                     BETWEEN

                         PROGRESS ENERGY CAROLINAS, INC.

                                       AND

                               WILLIAM D. JOHNSON


                                 January 1, 2005




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                              EMPLOYMENT AGREEMENT


     This EMPLOYMENT AGREEMENT  ("Agreement"),  dated as of the ____________ day
of  January,  2005,  is  between  Progress  Energy  Carolinas,  Inc.,  a limited
liability corporation headquartered in Raleigh, North Carolina and a wholly-owed
subsidiary of Progress Energy,  Inc., its successors or assigns,  and William D.
Johnson  ("Johnson").  Progress Energy  Carolinas,  Inc. shall be referred to as
"PEC" or "the Company" throughout. Progress Energy, Inc. shall be referred to as
"Progress Energy" throughout.

                                    Preamble

     The Company and Johnson agree to enter into an employment  relationship  in
which  Johnson will serve as President and Chief  Operating  Officer of Progress
Energy, for the term as set forth within the Agreement,  and in consideration of
this Agreement, the parties agree to the terms and provisions outlined herein:

                                   Provisions

     NOW,  THEREFORE,  in  consideration  of the mutual  covenants  and promises
contained herein and for other good and valuable consideration,  the receipt and
sufficiency of which are hereby  acknowledged  and accepted,  the parties hereto
hereby agree as follows:

     1. RESPONSIBILITIES; OTHER ACTIVITIES.

     Johnson shall occupy the position of President and Chief Operating  Officer
at Progress Energy and shall undertake the general  responsibilities  and duties
of such  position  as directed by Progress  Energy's  Chief  Executive  Officer.
During the Term of the  Agreement as defined in Section 2, below,  Johnson shall
perform  faithfully  the duties of Johnson's  position,  devote all of Johnson's
working  time and  energies to the  business  and  affairs of Progress  Energy's
regulated  operating  subsidiaries and shall use Johnson's best efforts,  skills
and abilities to promote  Progress  Energy's  general  business  interests.  PEC
reserves the right to reassign  Johnson to other positions within the controlled
group of Progress Energy companies.

     2. TERM OF THE AGREEMENT:

          (a) The Agreement becomes effective on January 1, 2005 ("the Effective
Date"), and shall remain in effect until December 31, 2007.

          (b) On January 1, 2006 and on January 1 of each year thereafter  ("the
Extension Date"), the Agreement will be extended such that each prospective term
will always be three years forward ("Evergrow provisions").


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          (c) The Company may elect to not extend the  Agreement and must notify
Johnson  no later  than 60 days  prior to the  Extension  Date  that it does not
intend to renew the  Agreement  pursuant to paragraph  2(b),  above.  Should the
Company elect not to renew the Agreement,  the Agreement will continue in effect
for the remainder of its term.

          (d) The Agreement  cannot extend beyond  Johnson's  normal  retirement
date  unless  Johnson is  requested  to serve in his  full-time  position  for a
defined period as set forth by the Chief Executive Officer of Progress Energy.

     3. BASE SALARY. As compensation for the services to be performed hereunder,
Johnson  will be  paid a Base  Salary  at the  annual  rate of  ________________
($_________)  (less applicable  withholdings)  ("Base Salary") during 2005. Base
Salary for each  subsequent  year of  employment  under the  Agreement  shall be
subject to adjustment by PEC during the normal annual salary review  process for
similarly  situated  executives as determined by PEC in its  discretion.  Annual
Base Salary shall be deemed earned  proportionally  as Johnson performs services
over the course of each year the Agreement is in effect. Payments of annual Base
Salary shall be made,  except as otherwise  provided herein,  in accordance with
PEC's standard payroll policies and procedures.

     4. EMPLOYEE  BENEFIT PLANS.  During the Employment  Term,  Johnson shall be
entitled to participate in all applicable  Company and Progress Energy sponsored
benefits  plans as may be in effect upon terms and in  accordance  with policies
and procedures  equivalent to those then in effect and  applicable  generally to
PEC employees.

     5. EXECUTIVE INCENTIVES, BENEFITS AND PERQUISITES. Johnson will be eligible
to  participate  in the following  executive  incentive and benefit plans and to
receive the following executive perquisites:

          (a) Short Term Incentive  Plan.  Johnson is eligible to participate in
the Progress Energy sponsored  Management  Incentive  Compensation  Plan (MICP),
subject to its terms.

          (b) Long Term Incentive  Plans.  Johnson is eligible to participate in
the Progress Energy long term incentive program,  subject to its terms, with the
following components:

               (i) PSSP.  An award of  performance  shares/units  earned  over a
three-year  period and  adjusted  based on Progress  Energy  performance.  These
annual awards are generally made in March.

               (ii)  Restricted  Stock.  An award  of  restricted  common  stock
vesting  ratably on the 3rd, 4th and 5th  anniversaries  from the date of grant.
These annual awards are generally made in March.

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          (c) Base Salary  Deferral Plan.  Johnson is eligible to participate in
the Progress Energy  sponsored  Management  Deferred  Compensation  Plan (MDCP),
subject to its terms.

          (d) Incentive Deferral Plans.  Johnson is eligible to defer up to 100%
of his earned MICP and/or PSSP awards into deemed investments of Progress Energy
common stock on an unfunded basis.

          (e) Supplemental  Senior Executive  Retirement Plan.  Johnson shall be
eligible for  participation in Progress Energy's  Supplemental  Senior Executive
Retirement  Plan  (SERP),  subject to its terms.  For purposes of the SERP only,
Johnson  has been  credited  with seven  years of deemed  service  (vesting  and
benefits), including the three year Senior Management Committee requirement.

          (f) Split Dollar Insurance Plan. Johnson shall continue to participate
in the Progress Energy  sponsored  Split Dollar Life Insurance Plan,  subject to
its terms and consistent with applicable laws and regulations.

          (g)  Executive  AD&D Life  Insurance.  Johnson  shall be  eligible  to
participate in Progress Energy's  Executive AD&D Life Insurance Plan, subject to
its terms.

          (h) Financial  Planning.  Johnson shall be eligible to  participate in
the Progress Energy sponsored financial planning program, subject to its terms.

          (i) Estate Planning.  Johnson is eligible to receive  reimbursement of
up to $_________  annually for the  preparation and periodic update of Johnson's
estate plan.

          (j) Automobile Allowance. Johnson is eligible to receive an automobile
allowance  of  ___________________  ($______)  per  month  (less  withholdings),
subject to the terms of applicable Progress Energy policies.

          (k) Annual Physical.  PEC will pay for an annual physical  examination
by a physician of Johnson's  choice within the  parameters of Progress  Energy's
executive physical program.

          (l) Luncheon Club. PEC will pay the monthly dues for a membership at a
luncheon club approved by Progress  Energy's Chief Executive  Officer.  Business
related  expenses  will be  reimbursed  consistent  with PEC's  expense  account
guidelines.

          (m)  Country  Club  Membership.  PEC  will pay an  initiation  fee and
monthly dues for a membership for Johnson at a country club approved by Progress
Energy's Chief Executive  Officer.  Business related expenses will be reimbursed
consistent with PEC expense account guidelines.

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          (n) Health Club Membership. PEC will pay an initiation fee and monthly
dues to a health club for Johnson's membership.

          (o)  Home  Security.  PEC  will  provide  a home  security  system  at
Johnson's residence and reimburse Johnson for applicable monitoring fees.

          (p) Air Travel.

               (i) PEC will provide an airline  club  membership  in  accordance
with Company policy.

               (ii) PEC will reimburse  Johnson's  spouse's travel expenses when
she  accompanies  Johnson to  business  meetings  where  spousal  attendance  is
customary.

               (iii) PEC will provide chartered  aircraft for Johnson's business
related travel as needed.

               (iv)  PEC  will  allow  Johnson  to  travel  first  class  at his
discretion for business related travel.

          (q) Personal Computer. PEC will provide a personal computer to Johnson
to be used at his personal residence.

     6.  COMPANY  PLAN AND PROGRAM  MAINTENANCE.  Johnson's  entitlement  to the
benefits  described  in  Sections 4 and 5 shall be governed  exclusively  by the
terms of the plans and programs  described in those  provisions.  Nothing in the
Agreement  shall require  Progress Energy or the Company to continue or maintain
any short term  incentive,  long term incentive,  employee or executive  benefit
plan or program or any  perquisite.  Progress  Energy and the Company shall have
the right to modify,  replace or eliminate  any  incentive  or benefit  plans or
programs, including perquisites.

     7.  VACATION  AND  HOLIDAYS.  Johnson will be entitled to four (4) weeks of
vacation leave per year, unless his combined years of service to Progress Energy
subsidiaries  entitle  him to  additional  vacation  leave  pursuant  to Company
policy. Johnson will be granted paid holidays per Company policy.

     8. TERMINATION OF EMPLOYMENT.

          (a) Involuntary Termination.

               (i) For purposes of this  Agreement,  PEC shall be deemed to have
terminated  Johnson's  employment  if Johnson is  displaced  from an  assignment
within the controlled group of Progress Energy subsidiaries and affiliates,  and
(1) is not  simultaneously  reassigned to another position within the controlled

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group of Progress Energy  subsidiaries and affiliates;  or (2) in the event that
Progress  Energy  sells  more  than 50% of its  interest  in a  Progress  Energy
subsidiary  to which  Johnson is assigned  to a third  party  during the term of
Johnson's  assignment,  the  third  party  purchaser  does not  offer  Johnson a
position with comparable authority, duties, wages and benefits.

               (ii)  Termination   Without  Cause.   During  the  term  of  this
Agreement,  if Johnson's employment from the controlled group of Progress Energy
companies  is  terminated  without  Cause  as  Cause  is  defined  in  paragraph
8(a)(iii),  then Johnson will be provided with his then-Base  Salary at the rate
at the time of  termination  for the  remainder  of the  Term of the  Agreement.
Additionally,  PEC will  reimburse  Johnson for the costs of continued  coverage
under  certain  health and welfare  benefit plans  pursuant to the  Consolidated
Omnibus  Budget  Reconciliation  Act of 1985  ("COBRA")  for up to eighteen (18)
months after the termination of his employment;  provided, however, that Johnson
shall not be eligible for COBRA  reimbursement  if he is otherwise  eligible for
coverage  under  benefit  plans  offering  substantially  equivalent  or greater
benefits  than the plans in which he is eligible  to  participate  under  COBRA.
Receipt of the  benefits in this  paragraph  is subject to the  requirements  of
paragraphs  8(f), (g) and (h) of this  Agreement.  In addition,  Johnson will be
eligible  to retain all  benefits  under  existing  benefit  plans to the extent
vested within the terms of those plans.

               (iii)  Termination  for Cause.  During the Term of the Agreement,
PEC  may  elect  at any  time  to  terminate  Johnson's  employment  immediately
hereunder and remove  Johnson from  employment  for Cause.  For purposes of this
paragraph  8(a)(iii),  Cause for the termination of employment  shall be defined
as:  (1)  any  act of  Johnson's  including,  but not  limited  to,  misconduct,
negligence,  unlawfulness,  dishonesty or inattention to the business,  which is
detrimental to PEC's interests; or (2) Johnson's  unsatisfactory job performance
or failure to comply  with PEC  policies,  rules or  regulations.  If Johnson is
terminated for Cause as defined herein,  then he shall be eligible to retain all
benefits under existing  benefit plans that have vested pursuant to those plans,
but he shall not be entitled  to any form of salary  continuation  or  severance
benefits.  Upon  termination for Cause,  Johnson shall be entitled to any earned
but unpaid Base Salary accrued to the date of termination.  Any continued rights
or  benefits  Johnson  or his legal  representatives  may have  under any PEC or
Progress Energy sponsored  employee benefit plan or program upon his termination
for Cause shall be determined in accordance  with the terms or provisions of the
plan or program.

          (b) Change in Control. In the event that Progress Energy experiences a
Change in Control,  as defined by the Progress  Energy,  Inc.  Change in Control
Plan ("the Change in Control  Plan") and Johnson is (1) designated as covered by
the  Change  in  Control   Plan,   and  (2)  is   Involuntarily   Terminated  or
Constructively  Terminated  under the terms of the Change in Control Plan,  then
the greater of the benefits under the Change in Control Plan, if applicable, and
the benefits available in the event of an involuntary  termination without Cause
as defined in paragraph  8(a)(ii),  will be the legal  authority  regarding  any
severance compensation and benefits.

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          (c)  Voluntary  Termination.  If  Johnson  terminates  his  employment
voluntarily  for any reason at any time, then he shall be eligible to retain all
benefits under existing  benefit plans that have vested pursuant to the terms of
those  plans,  but as of the last date of  regular  employment,  he shall not be
entitled to any form of salary continuation or other severance benefit.

          (d)  Termination  Due to Death. In the event of Johnson's death during
the Term of the Agreement,  Johnson's  employment  hereunder shall terminate and
the Company shall have no further  obligation  to Johnson  under this  Agreement
except as  specifically  provided in this Agreement.  Johnson's  estate shall be
entitled to receive  all earned but unpaid  Base  Salary  accrued to the date of
termination  and any short term  incentive for a prior fiscal year that has been
earned but not paid.  The short term  incentive,  if any,  for the year in which
Johnson's  death occurs shall be  calculated on a pro rata basis for the portion
of the fiscal year prior to Johnson's  death  occurring and shall be paid at the
regularly scheduled time for the payment of the short term incentive. Any rights
and benefits Johnson,  or Johnson's estate or other legal  representatives,  may
have under  employee  benefit plans and programs of PEC or Progress  Energy upon
Johnson's death during the Term of the Agreement, if any, shall be determined in
accordance with the terms and provisions of such plans and programs.

          (e) Termination Due to Medical Condition.

               (i) PEC may terminate Johnson's employment hereunder,  subject to
the Americans  With  Disabilities  Act or other  applicable  law, due to medical
condition  if (1) for a period of 180  consecutive  days  during the Term of the
Agreement,  Johnson  is  totally  and  permanently  disabled  as  determined  in
accordance  with the Company's long term  disability  plan (LTD),  if any, as in
effect  during  such time;  or (2) at any time  during  which no such plan is in
effect,  Johnson is substantially unable to perform his duties hereunder because
of a medical  condition for a period of 180 consecutive  days during the Term of
the  Agreement.  Provided,  however,  that if Johnson  applies for and is deemed
qualified for benefits under the Progress Energy  sponsored Long Term Disability
Plan (LTD Benefits), Johnson shall receive such benefits and his employment will
not be terminated as long as he is receiving LTD Benefits.

               (ii) Upon the termination of Johnson's  employment due to medical
condition or any period during which Johnson is qualified for LTD Benefits,  PEC
shall  have no further  obligation  to Johnson  under this  Agreement  except as
specifically provided in this Agreement.  Upon such termination or qualification
for LTD Benefits, Johnson shall be entitled to all earned but unpaid Base Salary
accrued  to the date of  termination  or  placement  on LTD and any  short  term
incentive  for a prior fiscal year that has been earned but not paid.  The short
term incentive, if any, for the current fiscal year shall be calculated on a pro
rata basis for the portion of the fiscal year Johnson was  performing the duties
of his  position  and  shall  be paid at the  regularly  scheduled  time for the
payment of the short term incentive.  Any continued rights and benefits Johnson,
or Johnson's legal  representatives,  may have under employee  benefit plans and
programs of PEC or Progress  Energy upon  Johnson's  termination or placement on
LTD due to medical condition, if any, shall be determined in accordance with the
terms and provisions of such plans and programs.

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          (f)  Release of Claims.  In order to  receive  continuation  of salary
under paragraph 8(a) or 8(b), Johnson agrees to execute a written release of all
claims against PEC, and its employees,  officers,  directors,  subsidiaries  and
affiliates, on a form acceptable to PEC.

          (g) Covenant Not to Compete.  If PEC terminates  Johnson's  employment
without  Cause under  paragraph  8(a),  or if Johnson  becomes  eligible for the
benefits  available under paragraph 8(a) as the result of a Change in Control as
set forth in paragraph 8(b),  Johnson,  for one year after the Termination Date,
shall not compete  directly or indirectly  with the Company,  or its  affiliates
within  fifty  (50)  miles of any  geographic  area in which the  Company or its
affiliates has a material  business  interest with which Johnson was involved at
the time of his separation.

          (h) Non Interference.  If PEC terminates  Johnson's employment without
Cause under  paragraph  8(a) or if Johnson  becomes  eligible  for the  benefits
available under paragraph 8(a) as the result of a Change in Control as set forth
in paragraph 8(b),  Johnson,  for one year after the Termination Date, shall not
whether on his own account or on the account of another individual, partnership,
firm,  corporation,  or other business  organization (other than the Company and
its  affiliates),  directly or indirectly,  intentionally  solicit,  endeavor to
entice away from the Company or any of its  affiliates,  or otherwise  interfere
with the  relationship  of the  Company  or its  affiliates,  any  person who is
employed  by or  otherwise  engaged to perform  services  for the Company or its
affiliates  including  but not limited to, any  independent  representatives  or
organizations,  or any person or entity that is a customer of the Company or its
affiliates.

     9. ASSIGNABILITY.

     No rights or obligations of Johnson under this Agreement may be assigned or
transferred by Johnson,  except that (i) Johnson's  rights to  compensation  and
benefits hereunder may be transferred by will or laws of intestacy to the extent
specified  herein and (ii)  Johnson's  rights under  employee  benefit  plans or
programs  described  in  Sections  4 and 5 may be  assigned  or  transferred  in
accordance  with the  terms of such  plans or  programs,  or  regular  practices
thereunder.  The Company may assign or transfer its rights and obligations under
this Agreement.

     10. CONFIDENTIALITY.

     Johnson  will not  disclose  the  terms  of this  Agreement  except  (i) to
financial and legal advisors under an obligation to maintain confidentiality, or
(ii) as required by a valid court order or subpoena  (and in such event will use
his best efforts to obtain a protective  order requiring that all disclosures be
kept under court seal) and will notify PEC  promptly  upon receipt of such order
or subpoena.

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     11. MISCELLANEOUS.

          (a) Governing Law. This Agreement  shall be governed by, and construed
in accordance with, the laws of the State of North Carolina without reference to
laws governing conflicts of law.

          (b)   Entire   Agreement.   This   Agreement   contains   all  of  the
understandings and representations  between the parties hereto pertaining to the
subject matter hereof and supersedes all  undertakings  and agreements,  whether
oral or in  writing,  if any,  previously  entered  into  by them  with  respect
thereto.

          (c) Amendment or Modification;  Waiver. No provision in this Agreement
may be  amended  or  waived  unless  such  amendment  or  waiver is agreed to in
writing, signed by Johnson and by an officer of PEC thereunto duly authorized to
do so. Except as otherwise specifically provided in the Agreement,  no waiver by
a party  hereto of any  breach by the other  party  hereto of any  condition  or
provision of the Agreement to be performed by such other party shall be deemed a
waiver of a similar or  dissimilar  provision  or  condition  at the same or any
prior or subsequent time.

          (d) Notice. Any notice (with the exception of notice of termination by
PEC,  which may be given by any means and need not be in writing  except that if
termination  is for Cause,  oral notice  must be followed by written  notice) or
other document or  communication  required or permitted to be given or delivered
hereunder  shall be in  writing  and shall be deemed to have been duly  given or
delivered  if (i)  mailed by  United  States  mail,  certified,  return  receipt
requested,  with proper postage prepaid,  or (ii) otherwise delivered by hand or
by  overnight  delivery,  against  written  receipt,  by  a  common  carrier  or
commercial  courier or delivery service,  to the party to whom it is to be given
at the address of such party as set forth  below (or to such other  address as a
party  shall  have  designated  by notice to the other  parties  given  pursuant
hereto):

          If to Johnson:
                   William D. Johnson
                   Progress Energy Carolinas, Inc.
                   410 S. Wilmington Street, PEB 1219
                   Raleigh, North Carolina 27601

          If to PEC:
                   Progress Energy Carolinas, Inc.
                   c/o Progress Energy Service Company, LLC
                   410 S. Wilmington Street
                   Raleigh, North Carolina 27601
                   Attn.:  Vice President, Human Resources

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Any  such  notice,  request,  demand,  advice,  schedule,  report,  certificate,
direction,  instruction  or other  document or  communication  so mailed or sent
shall be deemed to have been duly given,  if sent by mail, on the third business
day following the date on which it was deposited at a United States post office,
and if delivered by hand, at the time of delivery by such commercial  courier or
delivery service,  and, if delivered by overnight delivery service, on the first
business day following the date on which it was delivered to the custody of such
common carrier or commercial courier or delivery service,  as all such dates are
evidenced  by the  applicable  delivery  receipt,  airbill or other  shipping or
mailing document.

          (e)  Severability.  In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason, the
remaining  provisions or portions of this Agreement shall be unaffected  thereby
and shall  remain in full force and effect to the fullest  extent  permitted  by
law.

          (f)  References.  In  the  event  of  Johnson's  death  or a  judicial
determination of Johnson's incompetence,  reference in this Agreement to Johnson
shall be deemed, where appropriate,  to refer to Johnson's legal representative,
or, where appropriate, to Johnson's beneficiary or beneficiaries.

          (g) Headings.  Headings contained herein are for convenient  reference
only and shall not in any way  affect  the  meaning  or  interpretation  of this
Agreement.

          (h)   Counterparts.   This   Agreement  may  be  executed  in  several
counterparts,  each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.

          (i) Rules of  Construction.  The  following  rules  shall apply to the
construction and interpretation of this Agreement:

               (1) Singular words shall connote the plural number as well as the
singular and vice versa,  and the  masculine  shall include the feminine and the
neuter.

               (2) All  references  herein to particular  articles,  paragraphs,
sections,  subsections,   clauses,  Schedules  or  Exhibits  are  references  to
articles, paragraphs,  sections, subsections,  clauses, Schedules or Exhibits of
this Agreement.

               (3) Each party and its  counsel  have  reviewed  and  revised (or
requested  revisions of) this Agreement,  and therefore any rule of construction
requiring that  ambiguities are to be resolved  against a particular party shall
not be applicable in the  construction and  interpretation  of this Agreement or
any exhibits hereto or amendments hereof.

               (4) As used in this Agreement,  "including" is illustrative,  and
means "including but not limited to."

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          (j) Remedies.  Remedies specified in this Agreement are in addition to
any others available at law or in equity.

          (k)  Withholding  Taxes.  All payments under this  Agreement  shall be
subject  to  applicable   income,   excise  and   employment   tax   withholding
requirements.

          IN WITNESS WHEREOF,  the parties hereto have executed,  or have caused
this Agreement to be executed by their duly authorized  officer, as the case may
be, all as of the day and year written below.

WILLIAM D. JOHNSON


                                                     Date:
-----------------------------------                        --------------------



PROGRESS ENERGY CAROLINAS, INC.


By:                                                  Date:
   --------------------------------                        --------------------
      ROBERT B. MCGEHEE
      CHAIRMAN