Duke Energy 2014 Annual Report Download - page 207

187
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)
21. EMPLOYEE BENEFIT PLANS
DEFINED BENEFIT RETIREMENT PLANS
Duke Energy maintains, and the Subsidiary Registrants participate in,
qualifi ed, non-contributory defi ned benefi t retirement plans. The plans cover
most U.S. employees using a cash balance formula. Under a cash balance
formula, a plan participant accumulates a retirement benefi t consisting of
pay credits based upon a percentage of current eligible earnings based on age
and/or years of service and interest credits. Certain employees are covered
under plans that use a fi nal average earnings formula. Under these average
earnings formulas, a plan participant accumulates a retirement benefi t equal
to the sum of percentages of their (i) highest three- or four-year average
earnings, (ii) highest three- or four-year average earnings in excess of covered
compensation per year of participation (maximum of 35 years), and/or
(iii) highest three- or four-year average earnings times years of participation in
excess of 35 years. Duke Energy also maintains, and the Subsidiary Registrants
participate in, non-qualifi ed, non-contributory defi ned benefi t retirement plans
which cover certain executives. As of January 1, 2014, the qualifi ed and non-
qualifi ed non-contributory defi ned benefi t plans are closed to new and rehired
non-union and certain unionized employees.
Duke Energy uses a December 31 measurement date for its defi ned
benefi t retirement plan assets and obligations.
Net periodic benefi t costs disclosed in the tables below represent the cost
of the respective benefi t plan for the periods presented. However, portions of the
net periodic benefi t costs disclosed in the tables below have been capitalized as
a component of property, plant and equipment. Amounts presented in the tables
below for the Subsidiary Registrants represent the amounts of pension and
other post-retirement benefi t cost allocated by Duke Energy for employees of
the Subsidiary Registrants. Additionally, the Subsidiary Registrants are allocated
their proportionate share of pension and post-retirement benefi t cost for
employees of Duke Energy’s shared services affi liate that provide support to the
Subsidiary Registrants. These allocated amounts are included in the governance
and shared service costs discussed in Note 13.
Duke Energy’s policy is to fund amounts on an actuarial basis to provide
assets suffi cient to meet benefi t payments to be paid to plan participants. The
following table includes information related to the Duke Energy Registrants’
contributions to its U.S. qualifi ed defi ned benefi t pension plans.
(in millions)
Duke
Energy
Duke
Energy
Carolinas
Progress
Energy
Duke
Energy
Progress
Duke
Energy
Florida
Duke
Energy
Ohio
Duke
Energy
Indiana
Anticipated Contributions:
2015 $ 302 $ 91 $ 83 $ 42 $ 40 $ 8 $ 19
Contributions Made:
2014 $ — $ — $ — $ — $ — $ — $ —
2013 250 — 250 63 133 — —
2012 304 —346 141 128 — —
QUALIFIED PENSION PLANS
Components of Net Periodic Pension Costs
Year Ended December 31, 2014
(in millions)
Duke
Energy
Duke
Energy
Carolinas
Progress
Energy
Duke
Energy
Progress
Duke
Energy
Florida
Duke
Energy
Ohio
Duke
Energy
Indiana
Service cost $ 135 $ 41 $ 40 $ 21 $ 20 $ 4 $ 9
Interest cost on projected benefi t obligation 344 85 112 54 57 20 29
Expected return on plan assets (511) (132) (173) (85) (85) (27) (41)
Amortization of actuarial loss 150 36 68 32 32 4 13
Amortization of prior service credit (15) (8) (3) (2) (1) — —
Other 82311—1
Net periodic pension costs $ 111 $ 24 $ 47 $ 21 $ 24 $ 1 $ 11