Duke Energy 2014 Annual Report Download - page 133

113
PART II
DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. •
DUKE ENERGY PROGRESS, INC. • DUKE ENERGY FLORIDA, INC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC.
Combined Notes to Consolidated Financial Statements – (Continued)
The Disposal Group is included in the Commercial Power segment. The following table presents information related to the Duke Energy Ohio generation plants
included in the Disposal Group.
Facility Plant Type Primary Fuel Location
Total MW
Capacity(c)
Owned MW
Capacity(c)
Ownership
Interest
Stuart(a)(b) Fossil Steam Coal OH 2,308 900 39%
Zimmer(a) Fossil Steam Coal OH 1,300 605 46.5%
Hanging Rock Combined Cycle Gas OH 1,226 1,226 100%
Miami Fort (Units 7 and 8)(a) Fossil Steam Coal OH 1,020 652 64%
Conesville(a)(b) Fossil Steam Coal OH 780 312 40%
Washington Combined Cycle Gas OH 617 617 100%
Fayette Combined Cycle Gas PA 614 614 100%
Killen(a)(b) Fossil Steam Coal OH 600 198 33%
Lee Combustion Turbine Gas IL 568 568 100%
Dick’s Creek Combustion Turbine Gas OH 136 136 100%
Miami Fort Combustion Turbine Oil OH 56 56 100%
Total Midwest Generation 9,225 5,884
(a) Jointly owned with American Electric Power Generation Resources and/or The Dayton Power & Light Company.
(b) Station is not operated by Duke Energy Ohio.
(c) Total MW capacity is based on summer capacity.
The Disposal Group also includes a retail sales business owned by Duke
Energy. In the second quarter of 2014, Duke Energy Ohio removed Ohio Valley
Electric Corporation’s (OVEC) purchase power agreement from the Disposal
Group as it no longer intended to sell it with the Disposal Group. Duke Energy
Ohio has requested cost-based recovery of its contractual entitlement in OVEC
in its 2014 Electric Security Plan (ESP) application fi led on May 29, 2014. See
Note 4 for information related to the 2014 ESP.
The assets and associated liabilities of the Disposal Group are classifi ed
as held for sale in Duke Energy’s and Duke Energy Ohio’s Consolidated Balance
Sheets at December 31, 2014.
The results of operations of the Disposal Group are classifi ed as
discontinued operations for current and prior periods in the accompanying
Consolidated Statements of Operations and Comprehensive Income. Certain
immaterial costs that that may be eliminated as a result of the sale have
remained in continuing operations. The following table presents the results of
discontinued operations.
Duke Energy
Years Ended December 31,
(in millions) 2014 2013 2012
Operating Revenues $ 1,748 $ 1,885 $ 1,771
Estimated loss on disposition (929) ——
(Loss) Income before income taxes $ (818) $ 141 $ 227
Income tax (benefi t) expense (294) 56 82
(Loss) Income from discontinued operations of the
Disposal Group (524) 85 145
Other, net of tax(a) (52) 126
(Loss) Income from Discontinued Operations, net of tax $ (576) $ 86 $ 171
(a) Other discontinued operations relate to prior sales of businesses and includes indemnifi cations provided
for certain legal, tax and environmental matters, and foreign currency translation adjustments.
Duke Energy Ohio
Years Ended December 31,
(in millions) 2014 2013 2012
Operating Revenues $ 1,299 $ 1,503 $ 1,435
Estimated loss on disposition (959) ——
(Loss) Income before income taxes $ (863) $ 67 $ 195
Income tax (benefi t) expense (300) 32 65
(Loss) Income from Discontinued Operations, net of tax $ (563) $ 35 $ 130
The Duke Energy and Duke Energy Ohio held for sale assets include
net pretax impairments of approximately $929 million and $959 million,
respectively, for the year ended December 31, 2014. The impairment was
recorded to write-down the carrying amount of the assets to the estimated fair
value of the business, based on the expected selling price to Dynegy less cost to
sell. These losses were included in (Loss) Income from Discontinued Operations,
net of tax in the Consolidated Statements of Operations and Comprehensive
Income. The impairment will be updated, if necessary, based on the fi nal
sales price, after any adjustments at closing for working capital and capital
expenditures.
Commercial Power has a revolving credit agreement (RCA) to support the
operations of the nonregulated Midwest generation business. Interest expense
associated with the RCA has been allocated to discontinued operations. No
other interest expense related to corporate level debt has been allocated to
discontinued operations.