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generation/next
2015 ANNUAL REPORT AND FORM 10-K

Table of contents

  • Page 1
    2015 ANNUAL REPORT AND FORM 10-K generation/next

  • Page 2
    ... VALUES Safety • Integrity • Service Where we're going OUR VISION Lead the way to cleaner, smarter energy solutions that customers value. OUR STRATEGY Transform the Customer Experience Modernize the Power Grid Generate Cleaner Energy Engage Employees and Stakeholders We are using this Road...

  • Page 3
    ... that held us back in 2014. We have realigned our portfolio to grow our core businesses. And we have charted The Road Ahead (outlined on inside cover), a map for long-term success that will benefit our customers and investors for the next decade and well beyond. Today, Duke Energy is aligned as an...

  • Page 4
    ..."Income Taxes"); (iii) 2014 reserve related to the investigation of the Dan River coal ash release and other North Carolina ash basin management (see Note 5 to the Consolidated Financial Statements, "Commitments and Contingencies"); (iv) the 2015, 2014 and 2013 costs to achieve mergers; (v) 2014 and...

  • Page 5
    ... in four of our jointlyowned nuclear and coal plants in North Carolina. This supports our core business and helps the power agency's 32 cities reduce their high electric rates. It also provides long-term cost savings and fuel diversity for our retail customers. State and local officials praised the...

  • Page 6
    ... in our Green Source Rider program, which gives customers the option to purchase renewable energy to offset new energy consumption. We also partnered with the U.S. Navy on solar projects in North Carolina and Indiana. Duke Energy has broken ground on three solar sites in Florida and plans up to 500...

  • Page 7
    ... power. We also plan to hold our operating and maintenance expenses flat through 2020. "Doubling the dividend growth rate in 2015 is another important way we're committed to meeting investors' expectations." Steve Young Executive Vice President and Chief Financial Officer 2015 ANNUAL REPORT / 5 /

  • Page 8
    ...- Regulated Generation and Transmission Our strong balance sheet and investmentgrade credit ratings support achieving our financial objectives, keeping financing costs low and maintaining highly competitive energy prices for customers. inancial discipline in allocating capital and managing expenses...

  • Page 9
    ... energy solutions that customers value. The Road Ahead blueprint outlines the major strategic elements: transform "We earn trust by knowing what's right and having the courage to follow through." Julie Janson Executive Vice President, Chief Legal Officer and Corporate Secretary 2015 ANNUAL REPORT...

  • Page 10
    ... To further improve the customer experience, we're investing in a more flexible, resilient electric grid to make power outages increasingly rare and service restoration faster. Over time, we will equip our power lines to manage the growing number of small distributed energy resources such as rooftop...

  • Page 11
    ...agencies, Duke Energy helped recruit more than $3.5 billion in capital investment and 12,000 jobs to our service territories in 2015. This included a diverse mix of industries, such as automotive, aerospace, food and beverage, life sciences, advanced manufacturing and data centers. In 2015, the Duke...

  • Page 12
    ... in our company's success. Our industrial customers want flawless power reliability at a globally-competitive price. Low- and fixedincome customers worry about any increase in their monthly bill, while others are willing to pay more for new, innovative services, and some customers want only solar...

  • Page 13
    ... from equity investments) 33% Residential 31% General Services 21% Industrial 15% Wholesale/Other Regulated Utilities consists of Duke Energy's regulated generation, electric and natural gas transmission and distribution systems. Regulated Utilities generation portfolio is a balanced mix of energy...

  • Page 14
    ... 2012 William E. (Bill) Kennard Non-Executive Chairman - Velocitas Partners, LLC Member, Corporate Governance Committee, Finance and Risk Management Committee, Regulatory Policy and Operations Committee Director of Duke Energy since 2014 Lynn J. Good Chairman, President and Chief Executive Officer...

  • Page 15
    DUKE ENERGY CORPORATION Cautionary Statement Regarding Forward-Looking Information Non-GAAP Financial Measures 2015 Form 10-K A DUKE ENERGY l

  • Page 16

  • Page 17
    ... Duke Energy Indiana, LLC (collectively, the Duke Energy Registrants) may be different from what is expected; costs and effects of legal and administrative proceedings, settlements, investigations and claims; industrial, commercial and residential growth or decline in service territories or customer...

  • Page 18
    ..., 2015 (in millions, except per share amounts) Adjusted earnings Cost savings initiatives Costs to achieve mergers Edwardsport settlement Ash basin settlement and penalties International tax adjustment Asset impairment Economic hedges (mark-to-market) Asset sales Crystal River Unit 3 charges Nuclear...

  • Page 19
    ... Other net expense and any related growth rates for future periods, information to reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures is not available at this time, as the company is unable to forecast all special items, the mark-to-market impacts...

  • Page 20
    (This page intentionally left blank.)

  • Page 21
    ... no representation as to information relating exclusively to the other registrants. Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio and Duke Energy Indiana meet the conditions set forth in General Instructions I(1)(a) and (b) of Form 10-K and are...

  • Page 22
    ... storage, in Duke Energy service territories could result in customers leaving the electric distribution system, excess generation resources as well as stranded costs; • Advancements in technology; • Additional competition in electric markets and continued industry consolidation; • Political...

  • Page 23
    ... natural gas service line replacement program ASU ...Accounting standard update Board of Directors ...Duke Energy Board of Directors Bison...Bison Insurance Company Limited Brunswick ...Brunswick Nuclear Plant CAA ...Clean Air Act CAIR ...Clean Air Interstate Rule Calpine ...Calpine Corporation...

  • Page 24
    ... nuclear plant in Levy County, Florida Legacy Duke Energy Directors ...Members of the pre-merger Duke Energy Board of Directors LIBOR ...London Interbank Offered Rate Long-Term FERC Mitigation ...The revised market power mitigation plan related to the Progress Energy merger MATS...Mercury and Air...

  • Page 25
    ... Florida's proposed acquisition of Calpine Corporation's 599 MW combined-cycle natural gas plant in Auburndale, Florida OUCC...Office of Utility Consumer Counselor OVEC ...Ohio Valley Electric Corporation the Parent ...Duke Energy Corporation Holding Company PESC ...Progress Energy Service Company...

  • Page 26
    ... served retail electric and gas customers in Ohio with energy and other energy services at competitive rates. For additional information see Note 2 to the Consolidated Financial Statements, "Acquisitions and Dispositions." The Duke Energy Registrants electronically file reports with the Securities...

  • Page 27
    ... Prices are inï¬,uenced primarily by market conditions and fuel costs. Increased competition in the wholesale electric utility industry and the availability of transmission access could affect Regulated Utilities' load forecasts, plans for power supply and wholesale energy sales and related revenues...

  • Page 28
    ... for 2014 and 2013 have been adjusted to reï¬,ect the inclusion of Duke Energy Ohio auction purchases from PJM and Purchased power and net interchange. Coal Regulated Utilities meets its coal demand through a portfolio of longterm purchase contracts and short-term spot market purchase agreements...

  • Page 29
    ... 2015, the inventory balance for Regulated Utilities was $3,702 million. For additional information on inventory see Note 1 to the Consolidated Financial Statements, "Summary of Significant Accounting Policies." Ash Basin Management On September 20, 2014, the North Carolina Coal Ash Management Act...

  • Page 30
    ... through rates, when coupled with the existing fund balance and expected fund earnings, will be sufficient to provide for the cost of future decommissioning. For additional information see Note 9 to the Consolidated Financial Statements, "Asset Retirement Obligations." The Nuclear Waste Policy Act...

  • Page 31
    .... Annual Increase (in millions) Duke Energy Carolinas 2013 North Carolina Rate Case(a) Duke Energy Carolinas 2013 South Carolina Rate Case(a) Duke Energy Progress 2012 North Carolina Rate Case(a) Duke Energy Ohio 2012 Electric Rate Case Duke Energy Ohio 2012 Natural Gas Rate Case Duke Energy Florida...

  • Page 32
    ... information see Note 22 to the Consolidated Financial Statements, "Income Taxes." Customers, Competition and Regulation International Energy's customers include retail distributors, electric utilities, independent power producers, marketers, and industrial and commercial companies. International...

  • Page 33
    ...to the merger, Mr. Yates was President and Chief Executive Officer of Progress Energy Carolinas, Inc., which is now known as Duke Energy Progress, LLC. since July 2007. Executive Vice President and President, Regulated Generation and Transmission. Mr. Jamil assumed his current position in June 2015...

  • Page 34
    ...information, see Note 3 to the Consolidated Financial Statements, "Business Segments." DUKE ENERGY FLORIDA Duke Energy Florida is a regulated public utility primarily engaged in the generation, transmission, distribution, and sale of electricity in portions of Florida. Duke Energy Florida's service...

  • Page 35
    ... is a regulated public utility primarily engaged in the generation, transmission, distribution and sale of electricity in portions of Indiana. Duke Energy Indiana's service area covers 23,000 square miles and supplies electric service to 810,000 residential, commercial and industrial customers. See...

  • Page 36
    ... agencies as well as the North American Electric Reliability Corporation. Regulation affects almost every aspect of the Duke Energy Registrants' businesses, including, among other things, their ability to: take fundamental business management actions; determine the terms and rates of transmission...

  • Page 37
    ... Duke Energy Registrants have recognized significant asset retirement obligations related to these CCR-related requirements. In 2015, closure activities began at the four sites specified as high priority by the North Carolina Coal Ash Management Act (Coal Ash Act) and at the W.S. Lee Steam Station...

  • Page 38
    ... the event of such an attack, the Duke Energy Registrants could (i) have business operations disrupted, property damaged, customer information stolen and other private information accessed (ii) experience substantial loss of revenues, repair and restoration costs, implementation costs for additional...

  • Page 39
    ... in the RTO markets and those associated with complaint cases filed against an RTO that may seek refunds of revenues previously earned by RTO members. NUCLEAR GENERATION RISKS Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida may incur substantial costs and liabilities due...

  • Page 40
    ...to rate the Duke Energy Registrants below investment grade, borrowing costs would increase, perhaps significantly. In addition, the potential pool of investors and funding sources would likely decrease. Further, if the short-term debt rating were to fall, access to the commercial paper market could...

  • Page 41
    PART I ITEM 2. PROPERTIES REGULATED UTILITIES The following table provides information related to Regulated Utilities' electric generation stations as of December 31, 2015. The MW displayed in the table below are based on summer capacity. Facility Duke Energy Carolinas Oconee McGuire Catawba(a) ...

  • Page 42
    ... Gas/Oil Gas Oil Location FL FL FL FL FL FL FL FL FL FL FL FL FL FL FL FL (a) Jointly owned with North Carolina Municipal Power Agency Number 1, North Carolina Electric Membership Corporation and Piedmont Municipal Power Agency. (b) Duke Energy Florida owns and operates Intercession City Station...

  • Page 43
    ... to Duke Energy Carolinas', Duke Energy Progress', Duke Energy Florida's, Duke Energy Ohio's and Duke Energy Indiana's various series of First Mortgage Bonds. INTERNATIONAL ENERGY The following table provides additional information related to International Energy's electric generation stations as...

  • Page 44
    ... PORTFOLIO The following table provides information related to Commercial Portfolio's electric generation facilities as of December 31, 2015. The MW displayed in the table below are based on summer capacity. Facility Duke Energy Renewables - Wind Los Vientos Windpower Top of the World Notrees...

  • Page 45
    ... In June 2015, the Virginia State Water Control Board voted to approve a consent order to resolve the civil enforcement claim of the Virginia Department of Environmental Quality (VDEQ) against Duke Energy Carolinas related to the February 2014 Dan River coal ash release. Pursuant to the terms of the...

  • Page 46
    ... Duke Energy Board of Directors. Securities Authorized for Issuance Under Equity Compensation Plans Duke Energy's operating subsidiaries have certain restrictions on their ability to transfer funds in the form of dividends or loans to Duke Energy. See Note 4 to the Consolidated Financial Statements...

  • Page 47
    ... 2014 2015 Duke Energy Corporation Philadelphia Utility Index S&P 500 NYSE CEO Certification Duke Energy has filed the certification of its Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 as exhibits to this Annual Report on Form...

  • Page 48
    ... Consolidated Financial Statements, "Regulatory Matters"); (v) the 2012 merger with Progress Energy; (vi) costs to achieve mergers in 2015, 2014, 2013, 2012 and 2011; and (vii) 2012 and 2011 pretax impairment and other charges related to the Edwardsport Integrated Gasification Combined Cycle (IGCC...

  • Page 49
    ... of Duke Energy's common stock during the term of the program, less a discount. For additional information on the details of this transaction, see Note 18 to the Consolidated Financial Statements, "Common Stock." Annual Earnings Per Diluted Share Net Income Attributable to Duke Energy Corporation...

  • Page 50
    ...guaranteed fuel and joint dispatch savings. Grow the Dividend. In 2015, Duke Energy increased the growth rate of the dividend to an annual rate of approximately 4 percent. Duke Energy Objectives - 2016 and Beyond Duke Energy will continue to deliver exceptional value to our customers, be an integral...

  • Page 51
    ... announced new growth initiatives in 2015, which include: • Duke Energy Progress proposed an approximate $1 billion investment in the Western Carolinas Modernization Project. The project will retire and replace the existing coal units with two natural gas combined-cycle 280 MW fired generation...

  • Page 52
    ... segment income/Adjusted earnings Crystal River Unit 3 charges Costs to achieve mergers Midwest generation operations Nuclear development charges Litigation reserve Asset sales Discontinued operations Segment income (loss)/Net income attributable to Duke Energy Corporation Other $(119) - (184) 14...

  • Page 53
    ... to energy efficiency programs, equity returns related to additional ownership interest in assets acquired from NCEMPA, and higher base rates; • Increased wholesale net margins largely due to increases in contracted amounts and prices and a new wholesale contract with NCEMPA; • Retail sales...

  • Page 54
    ... 31, 2015 as Compared to 2014 Regulated Utilities' results increased due to an increase in wholesale power margins, growth in retail sales, and increased retail pricing primarily due to rate riders in most jurisdictions, including increased revenues related to energy efficiency programs, and...

  • Page 55
    ... to retail rate changes and updated rate riders; • a $216 million increase in electric sales (net of fuel revenue) to retail customers due to more favorable weather conditions across the service territory. Compared to normal, weather was favorable in the Carolinas and Florida service territories...

  • Page 56
    ... the Crystal River Unit 3 Regulatory asset with low-cost securities. Securitization will replace base rate recovery and result in a lower rate impact to customers. Securitization of the costs of the retired Crystal River Unit 3 Nuclear Plant would result in an initial acceleration of cash, followed...

  • Page 57
    ... 31, 2015 as Compared to 2014 International Energy's results were impacted by the absence of prior-year taxes on repatriated foreign earnings, partially offset by lower results in Brazil due to lower demand, unfavorable hydrological conditions and changes in foreign currency exchange rates, the...

  • Page 58
    ...market price of Brent crude oil and related commodities will likely result in a further decline in equity earnings from NMC. On February 18, 2016, Duke Energy announced it had initiated a process to divest the International Energy business segment, excluding the equity method investment in NMC. Duke...

  • Page 59
    ... production as units have been retired; • a $7 million decrease in net mark-to-market revenues on nonqualifying power hedge contracts. Partially offset by: • a $16 million increase in electric revenues from higher production in the renewables portfolio. Losses on Sales of Other Assets and Other...

  • Page 60
    ... residual Midwest Generation business from the Commercial Portfolio segment to Other in 2015 (see Note 3 to the Consolidated Financial Statements, "Business Segments,") and higher North Carolina franchise taxes, partially offset by lower charges related to the Progress Energy merger and higher prior...

  • Page 61
    ... as change in fuel mix, partially offset by an increase in demand from customers. Fuel revenues represent sales to retail and wholesale customers; and • a $78 million decrease in revenues to recover gross receipts taxes due to the North Carolina Tax Simplification and Rate Reduction Act, which...

  • Page 62
    ... other costs for replacement generation as a result of this rule. Duke Energy Carolinas cannot predict the outcome of these matters. PROGRESS ENERGY Introduction Management's Discussion and Analysis should be read in conjunction with the accompanying Consolidated Financial Statements and Notes for...

  • Page 63
    ... rates at Duke Energy Florida, partially offset by higher retail pricing and rate riders at Duke Energy Progress, which primarily reï¬,ect increased revenues related to the energy efficiency programs and the second year base rate step-up from the 2013 North Carolina retail rate case. Operating...

  • Page 64
    ...to a new NCEMPA contract effective August 1, 2015, and increased demand rates charged along with higher peak demand; • a $34 million increase in retail pricing and rate riders, which primarily reï¬,ect increased revenues related to the energy efficiency programs and the second year base rate step...

  • Page 65
    ... to the criminal investigation of the management of the coal ash basins in 2014, an increase in AFUDC equity, and the reduction of the North Carolina statutory corporate state income tax rate. Matters Impacting Future Results Duke Energy Progress is a party to multiple lawsuits and subject to fines...

  • Page 66
    ... low-cost securities. Securitization will replace base rate recovery and result in a lower rate impact to customers. Securitization of the costs of the retired Crystal River Unit 3 Nuclear Plant would result in an initial acceleration of cash, followed by a reduction to Duke Energy Florida's future...

  • Page 67
    ...are shared with Duke Energy Kentucky retail customers; • a $19 million increase in regulated natural gas rate riders primarily due to rate increases; • a $19 million increase in Ohio other revenues related to OVEC; and • a $16 million increase in electric rate riders, excluding Ohio energy ef...

  • Page 68
    ...operate coal-fired generation plants continue to grow due to increasing environmental compliance requirements, including ash management costs unrelated to CPP, and this may result in the retirement of coal-fired generation plants earlier than the current useful lives. Duke Energy Ohio continues to...

  • Page 69
    ... the 2015 Edwardsport IGCC settlements. See Note 4 to the Consolidated Financial Statements, "Regulatory Matters," for additional information. Other Income and Expense, net. The variance was primarily due to lower AFUDC equity due to Cayuga scrubbers placed into service in July 2015 and a lower rate...

  • Page 70
    ... reporting unit. The WACC takes into account both the after-tax cost of debt and cost of equity. A major component of the cost of equity is the current risk-free rate on 20-year U.S. Treasury bonds. In the 2015 impairment tests, Duke Energy considered implied WACCs for certain peer companies...

  • Page 71
    ... unbilled electric and gas revenues earned when service has been delivered but not billed by the end of the accounting period. Unbilled retail revenues are estimated by applying an average revenue per kilowatt-hour (kWh) or per thousand cubic feet (Mcf) for all customer classes to the number of...

  • Page 72
    ... a 1 percentage point change in the health care trend rate were to occur. Other Post-Retirement Plans (in millions) Effect on 2015 other post-retirement expense Effect on other post-retirement benefit obligation at December 31, 2015 1% $ 7 29 (1)% $ (6) (26) For further information, see Note 21 to...

  • Page 73
    ... for Duke Energy Kentucky. (b) Duke Energy issued $625 million of commercial paper and loaned the proceeds through the money pool to Duke Energy Carolinas, Duke Energy Progress, Duke Energy Ohio and Duke Energy Indiana. The balances are included within Long-Term Debt Payable to Affiliated Companies...

  • Page 74
    ... Form S-3, which is uncapped, the Duke Energy Registrants, excluding Progress Energy may issue debt and other securities in the future at amounts, prices and with terms to be determined at the time of future offerings. The registration statement also allows for the issuance of common stock by Duke...

  • Page 75
    ... price ï¬,uctuations, and unanticipated expenses including unplanned plant outages, storms, and legal costs and related settlements can affect the timing and level of cash ï¬,ows from operations. Duke Energy believes it has sufficient liquidity resources through the commercial paper markets...

  • Page 76
    ...fied pension plans, favorable retail pricing and rate riders and favorable weather, partially offset by current year under collection of fuel and purchased power costs and timing of cash payments for operations and maintenance expenses. For the year ended December 31, 2015 compared to 2014, the...

  • Page 77
    ...) Issuance of common stock related to employee benefit plans (Repayments) Issuances of long-term debt, net Notes payable and commercial paper Dividends paid Repurchase of common shares Other financing items Net cash used in financing activities $ 2015 17 $ (74) 1,245 (2,254) (1,500) (12) 2014 25...

  • Page 78
    ... repayment of outstanding commercial paper and for general corporate purposes. See Note 13 to the Consolidated Financial Statements, "Related Party Transactions" for additional information related to the redemption of Duke Energy Ohio's tax-exempt bonds. (b) The debt is ï¬,oating rate based on three...

  • Page 79
    ... services that are provided on demand, for which the timing of the purchase cannot be determined. (h) Related to future annual funding obligations to NDTF through nuclear power stations' re-licensing dates. Amounts through 2017 include North Carolina jurisdictional amounts that Duke Energy Progress...

  • Page 80
    ... Consolidated Financial Statements, "Derivatives and Hedging," for additional information regarding credit risk related to derivative instruments. The Duke Energy Registrants' principal counterparties for its electric and gas businesses are regional transmission organizations, distribution companies...

  • Page 81
    ... retail rates. Management continually monitors customer charge-offs and payment patterns to ensure the adequacy of bad debt reserves. Duke Energy Ohio and Duke Energy Indiana sell certain of their accounts receivable and related collections through Cinergy Receivables Company, LLC (CRC), a Duke...

  • Page 82
    ... Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana 3.2 4.7 2.9 3.7 4.3 3.6 3.6 2014 3.2 4.6 2.7 3.5 4.1 2.1 4.1 2013 3.0 4.4 2.2 3.7 2.9 2.2 4.1 North Carolina Coal Ash Management Act of 2014 On September 20, 2014, the Coal Ash Act became law and was amended on June 24, 2015...

  • Page 83
    ... Balance Sheets. For more information related to asset retirement obligations, see Note 9 to the Consolidated Financial Statements. (in millions) Duke Energy Duke Energy Carolinas Progress Energy Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Five-Year Estimated Costs...

  • Page 84
    ... to grow due to increasing environmental compliance requirements, including ash management costs unrelated to CPP, which may result in the retirement of coal-fired generation plants earlier than the current useful lives. The Duke Energy Registrants are studying the CPP rule and are working with...

  • Page 85
    ...Duke Energy Indiana) Report of Independent Registered Public Accounting Firm ...Consolidated Statements of Operations and Comprehensive Income...Consolidated Balance Sheets ...Consolidated Statements of Cash Flows ...Consolidated Statements of Changes in Equity... 101 102 103 104 105 Combined Notes...

  • Page 86
    ... Duke Energy Corporation Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Corporation and subsidiaries (the "Company") as of December 31, 2015 and 2014, and the related consolidated statements of operations, comprehensive income, changes in equity...

  • Page 87
    ... - regulated Fuel used in electric generation and purchased power - nonregulated Cost of natural gas Operation, maintenance and other Depreciation and amortization Property and other taxes Impairment charges Total operating expenses Gains (Losses) on Sales of Other Assets and Other, net Operating...

  • Page 88
    ... into earnings from available-for-sale securities Other Comprehensive Loss, net of tax Comprehensive Income Less: Comprehensive Income Attributable to Noncontrolling Interests Comprehensive Income Attributable to Duke Energy Corporation (a) Net of insignificant tax expense in 2015, 2014 and $17...

  • Page 89
    ... Cost Accumulated depreciation and amortization Generation facilities to be retired, net Net property, plant and equipment Regulatory Assets and Deferred Debits Regulatory assets Other Total regulatory assets and deferred debits Total Assets See Notes to Consolidated Financial Statements 2015 2014...

  • Page 90
    PART II DUKE ENERGY CORPORATION CONSOLIDATED BALANCE SHEETS - (Continued) December 31, (in millions) LIABILITIES AND EQUITY Current Liabilities Accounts payable Notes payable and commercial paper Taxes accrued Interest accrued Current maturities of long-term debt Liabilities associated with assets ...

  • Page 91
    ... and maturities of available-for-sale securities Net proceeds from the sale of Midwest generation business and sales of equity investments and other assets Change in restricted cash Other Net cash used in investing activities See Notes to Consolidated Financial Statements 2015 $ 2,831 3,613 (164...

  • Page 92
    ...of short-term debt with original maturities greater than 90 days Notes payable and commercial paper Distributions to noncontrolling interests Contributions from noncontrolling interests Dividends paid Repurchase of common shares Other Net cash used in financing activities Net (decrease) increase in...

  • Page 93
    ...II DUKE ENERGY CORPORATION CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Duke Energy Corporation Stockholders' Accumulated Other Comprehensive Loss Net Unrealized Total Foreign Net Gains (Losses) Duke Energy Common Additional Currency Losses on on Available- Pension and Corporation Stock Common Paid...

  • Page 94
    ... Carolinas, LLC Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Carolinas, LLC and subsidiaries (the "Company") as of December 31, 2015 and 2014, and the related consolidated statements of operations and comprehensive income, changes in equity...

  • Page 95
    ... II DUKE ENERGY CAROLINAS, LLC CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years Ended December 31, (in millions) Operating Revenues Operating Expenses Fuel used in electric generation and purchased power Operation, maintenance and other Depreciation and amortization Property and...

  • Page 96
    ...-term debt Regulatory liabilities Other Total current liabilities Long-Term Debt Long-Term Debt Payable to Affiliated Companies Deferred Credits and Other Liabilities Deferred income taxes Investment tax credits Accrued pension and other post-retirement benefit costs Asset retirement obligations...

  • Page 97
    ... Increase (decrease) in Accounts payable Accounts payable to affiliated companies Taxes accrued Other current liabilities Other assets Other liabilities Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Purchases of available-for-sale securities...

  • Page 98
    PART II DUKE ENERGY CAROLINAS, LLC CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Accumulated Other Comprehensive Loss Net Losses on Cash Flow Hedges $ (15) - 1 - $ (14) - 2 - $ (12) - 1 - $(11) Net Losses Availablefor-Sale Securities $ (1) - - - $ (1) - - - $ (1) - 1 - $ - (in millions) Balance at ...

  • Page 99
    ... Energy, Inc. Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Progress Energy, Inc. and subsidiaries (the "Company") as of December 31, 2015 and 2014, and the related consolidated statements of operations and comprehensive income, changes in equity, and cash...

  • Page 100
    ... (in millions) Operating Revenues Operating Expenses Fuel used in electric generation and purchased power Operation, maintenance and other Depreciation and amortization Property and other taxes Impairment charges Total operating expenses Gains on Sales of Other Assets and Other, net Operating Income...

  • Page 101
    ... Cost Accumulated depreciation and amortization Generation facilities to be retired, net Net property, plant and equipment Regulatory Assets and Deferred Debits Regulatory assets Other Total regulatory assets and deferred debits Total Assets See Notes to Consolidated Financial Statements 2015 2014...

  • Page 102
    ...PROGRESS ENERGY, INC. CONSOLIDATED BALANCE SHEETS - (Continued) December 31, (in millions) LIABILITIES AND EQUITY Current Liabilities Accounts payable Accounts payable to affiliated companies Notes payable to affiliated companies Taxes accrued Interest accrued Current maturities of long-term debt...

  • Page 103
    ... Accounts payable Accounts payable to affiliated companies Taxes accrued Other current liabilities Other assets Other liabilities Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Asset acquisition Purchases of available-for-sale securities Proceeds...

  • Page 104
    ...-term debt Redemption of preferred stock of subsidiaries Notes payable to affiliated companies Distributions to noncontrolling interests Capital contribution from parent Other Net cash provided by financing activities Net increase (decrease) in cash and cash equivalents Cash and Cash Equivalents...

  • Page 105
    ... interests Transfer of service company net assets to Duke Energy Other Balance at December 31, 2014 Net income Other comprehensive income (loss) Distributions to noncontrolling interests Capital contribution from parent Other Balance at December 31, 2015 Common Stock Total Equity $ 10...

  • Page 106
    ... Energy Progress, LLC Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Progress, LLC and subsidiaries (the "Company") (formerly Duke Energy Progress, Inc. and subsidiaries) as of December 31, 2015 and 2014, and the related consolidated statements...

  • Page 107
    PART II DUKE ENERGY PROGRESS, LLC (formerly DUKE ENERGY PROGRESS, INC.) CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years Ended December 31, (in millions) Operating Revenues Operating Expenses Fuel used in electric generation and purchased power Operation, maintenance and other ...

  • Page 108
    ...-term debt Regulatory liabilities Other Total current liabilities Long-Term Debt Long-Term Debt Payable to Affiliated Companies Deferred Credits and Other Liabilities Deferred income taxes Investment tax credits Accrued pension and other post-retirement benefit costs Asset retirement obligations...

  • Page 109
    ... Accounts payable Accounts payable to affiliated companies Taxes accrued Other current liabilities Other assets Other liabilities Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Asset acquisition Purchases of available-for-sale securities Proceeds...

  • Page 110
    ..., LLC (formerly DUKE ENERGY PROGRESS, INC.) CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (in millions) Balance at December 31, 2012 Net income Premium on the redemption of preferred stock Balance at December 31, 2013 Net income Dividends to parent Balance at December 31, 2014 Net income Transfer to...

  • Page 111
    ... II REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors of Duke Energy Florida, LLC Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Florida, LLC and subsidiaries (the "Company") (formerly Duke Energy Florida, Inc...

  • Page 112
    PART II DUKE ENERGY FLORIDA, LLC (formerly DUKE ENERGY FLORIDA, INC.) CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years Ended December 31, (in millions) Operating Revenues Operating Expenses Fuel used in electric generation and purchased power Operation, maintenance and other ...

  • Page 113
    ...-Term Debt Deferred Credits and Other Liabilities Deferred income taxes Accrued pension and other post-retirement benefit costs Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Member's equity Common Stock...

  • Page 114
    ... Increase (decrease) in Accounts payable Accounts payable to affiliated companies Taxes accrued Other current liabilities Other assets Other liabilities Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Purchases of available-for-sale securities...

  • Page 115
    ... FLORIDA, LLC (formerly DUKE ENERGY FLORIDA, INC.) CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Accumulated Other Comprehensive Loss Common Stock $ 1,762 - - - - $ 1,762 - - - $ 1,762 - - - (1,762) $ See Notes to Consolidated Financial Statements (in millions) Balance at December 31, 2012 Net...

  • Page 116
    ... PUBLIC ACCOUNTING FIRM To the Board of Directors of Duke Energy Ohio, Inc. Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Ohio, Inc. and subsidiaries (the "Company") as of December 31, 2015 and 2014, and the related consolidated statements...

  • Page 117
    ... II DUKE ENERGY OHIO, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years Ended December 31, (in millions) Operating Revenues Regulated electric Nonregulated electric and other Regulated natural gas Total operating revenues Operating Expenses Fuel used in electric generation...

  • Page 118
    ... Total current liabilities Long-Term Debt Long-Term Debt Payable to Affiliated Companies Deferred Credits and Other Liabilities Deferred income taxes Accrued pension and other post-retirement benefit costs Liabilities associated with assets held for sale Asset retirement obligations Regulatory...

  • Page 119
    ... accretion Equity component of AFUDC Gains on sales of other assets and other, net Impairment charges Deferred income taxes Accrued pension and other post-retirement benefit costs Contributions to qualified pension plans Payments for asset retirement obligations (Increase) decrease in Net realized...

  • Page 120
    ... II DUKE ENERGY OHIO, INC. CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Accumulated Other Comprehensive Loss Common Additional Accumulated Stock Paid-in Capital Deficit $762 - - $762 - - $762 - - - $762 See Notes to Consolidated Financial Statements (in millions) Balance at December 31, 2012 Net...

  • Page 121
    ...INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors of Duke Energy Indiana, LLC Charlotte, North Carolina We have audited the accompanying consolidated balance sheets of Duke Energy Indiana, Inc. and subsidiary (the "Company") (subsequently Duke Energy Indiana, LLC and subsidiary...

  • Page 122
    ... DUKE ENERGY INDIANA, LLC) CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME Years Ended December 31, (in millions) Operating Revenues Operating Expenses Fuel used in electric generation and purchased power Operation, maintenance and other Depreciation and amortization Property...

  • Page 123
    ...subsequently DUKE ENERGY INDIANA, LLC) CONSOLIDATED BALANCE SHEETS December 31, (in millions) ASSETS Current Assets Cash and cash equivalents Receivables (net of allowance for doubtful accounts of $1 at December 31, 2015 and December 31, 2014) Receivables from affiliated companies Notes receivable...

  • Page 124
    ... Increase (decrease) in Accounts payable Accounts payable to affiliated companies Taxes accrued Other current liabilities Other assets Other liabilities Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Purchases of available-for-sale securities...

  • Page 125
    ... DUKE ENERGY INDIANA, LLC) CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Accumulated Other Comprehensive Income Common Stock $ 1 - - - $ 1 - - $ 1 - - - $ 1 See Notes to Consolidated Financial Statements (in millions) Balance at December 31, 2012 Net income Other comprehensive loss Dividend...

  • Page 126
    ... 2015, Duke Energy Progress, a North Carolina corporation, converted into a North Carolina limited liability company. Duke Energy Florida is a regulated public utility primarily engaged in the generation, transmission, distribution and sale of electricity in portions of Florida. Duke Energy Florida...

  • Page 127
    ... 31, 2014. See Note 2 for additional information. For the year ended December 31, 2015, Duke Energy's Income from Discontinued Operations, net of tax was primarily related to results of operations of the nonregulated Midwest generation business and Duke Energy Retail Sales, LLC (collectively, the...

  • Page 128
    ... such that sufficient gas or electric services can be sold to recover those costs, the Duke Energy Registrants apply regulatory accounting. Regulatory accounting changes the timing of the recognition of costs or revenues relative to a company that does not apply regulatory accounting. As a result...

  • Page 129
    ... Coal held for electric generation Oil, gas and other fuel held for electric generation Total inventory Investments in Debt and Equity Securities The Duke Energy Registrants classify investments into two categories - trading and available-for-sale. Both categories are recorded at fair value on the...

  • Page 130
    ...CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Years Ended December 31, 2015 Duke Energy Duke...

  • Page 131
    ... Debt Premium, Discount and Expense Additionally, Duke Energy Ohio and Duke Energy Indiana sell, on a revolving basis, nearly all of their retail accounts receivable, including receivables for unbilled revenues, to an affiliate, Cinergy Receivables Company, LLC (CRC) and account for the transfers...

  • Page 132
    ... basis as both operating revenues and property and other taxes in the Consolidated Statements of Operations were as follows. Years Ended December 31, (in millions) Duke Energy Duke Energy Carolinas Progress Energy Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana 2015...

  • Page 133
    ...LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) On July 23, 2013, North Carolina House Bill 998 (HB 998 or the North Carolina Tax Simplification and Rate Reduction Act) was signed into law...

  • Page 134
    ... power formula rates on December 9, 2014. On July 8, 2015, the NCUC adopted a new rule that enables a rider mechanism for recovery of the costs to acquire, operate and maintain interests in the assets purchased as allocated to Duke Energy Progress' North Carolina retail operations, including...

  • Page 135
    ... Duke Energy's and Duke Energy Ohio's Consolidated Balance Sheet at December 31, 2014. The following table presents information at the time of the sale related to the Duke Energy Ohio generation plants included in the Disposal Group. Plant Type Fossil Steam Fossil Steam Combined Cycle Fossil Steam...

  • Page 136
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Duke Energy Ohio Years ...

  • Page 137
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Year Ended December 31, 2015...

  • Page 138
    ..., Duke Energy Carolinas implemented revised customer rates approved by the NCUC and the PSCSC. These rate increases impact Regulated Utilities. Regulated Utilities recorded an impairment charge related to Duke Energy Florida's Crystal River Unit 3. See Note 4 for additional information. Regulated...

  • Page 139
    ... to buy power from OVEC's power plants. For additional information on related party transactions refer to Note 9. See Note 13 for additional information. All of Duke Energy Ohio's revenues are generated domestically and its long-lived assets are all in the U.S. Year Ended December 31, 2015 Regulated...

  • Page 140
    ... operating revenues from North Carolina Electric Membership Corporation (NCEMC) in 2015. These revenues relate to wholesale contracts and transmission revenues. The assets Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana are substantially...

  • Page 141
    ...ash Asset retirement obligations - nuclear and other Accrued pension and OPEB Retired generation facilities Debt fair value adjustment Net regulatory asset related to income taxes Nuclear asset securitizable balance, net Hedge costs and other deferrals Demand side management (DSM)/Energy efficiency...

  • Page 142
    ...obligations - nuclear and other Accrued pension and OPEB Retired generation facilities Debt fair value adjustment Net regulatory asset related to income taxes Hedge costs and other deferrals DSM/EE Grid Modernization Vacation accrual Deferred fuel and purchased power Nuclear deferral Post-in-service...

  • Page 143
    ... for Duke Energy, Duke Energy Carolinas, Progress Energy and Duke Energy Progress include regulatory liabilities related to the change in the North Carolina corporate tax rate discussed in Note 22. Nuclear asset securitizable balance, net. Represents the balance associated with Crystal River Unit...

  • Page 144
    ...Energy's net assets at December 31, 2015. RATE RELATED INFORMATION FERC Transmission Return on Equity Complaint The NCUC, PSCSC, FPSC, IURC, PUCO and KPSC approve rates for retail electric and natural gas services within their states. The FERC approves rates for electric sales to wholesale customers...

  • Page 145
    ... MW combined-cycle natural gas power plant, installing solar generation at the site, building new transmission lines, a new substation and upgrades to area substations. On June 24, 2015, the North Carolina governor signed into law the North Carolina Mountain Energy Act of 2015 (Mountain Energy Act...

  • Page 146
    ... of approximately $47 million, net of tax, of the Crystal River Unit 3 regulatory asset from retail customers during 2014 and 2015, through its fuel clause. On May 22, 2015, Duke Energy Florida petitioned the FPSC for approval to include in base rates the revenue requirement for the projected $1.298...

  • Page 147
    ... 28, 2014, Duke Energy Ohio filed an application for recovery of program costs, lost distribution revenue and performance incentives related to its energy efficiency and peak demand reduction programs. These programs are undertaken to comply with environmental mandates set forth in Ohio law. After...

  • Page 148
    ...&L's historical original cost as an increase to property, plant and equipment and accumulated depreciation as of December 31, 2015. On August 20, 2015, the KPSC approved Duke Energy Kentucky's application to use the purchase price as the value of the newly acquired interest in the East Bend Station...

  • Page 149
    ... DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) FERC Transmission Return on Equity...

  • Page 150
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Grid Infrastructure Improvement Plan...

  • Page 151
    ... damage reserve and has a regulatory mechanism to recover the cost of named storms on an expedited basis. The cost of the Duke Energy Registrants' coverage can ï¬,uctuate year to year reï¬,ecting claims history and conditions of the insurance and reinsurance markets. In the event of a loss, terms...

  • Page 152
    .... • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) In the event of a loss, terms and amounts of insurance available might not be adequate to cover property damage and...

  • Page 153
    ... DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) disposal and other environmental matters. These regulations can be changed from time to time, imposing new obligations...

  • Page 154
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) of NCDEQ. Based on historic ...

  • Page 155
    ... • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Two shareholder Derivative Complaints, filed in 2012 in...

  • Page 156
    ... CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) groundwater standards. Both of these cases...

  • Page 157
    ... DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) security to meet their obligations...

  • Page 158
    .... Other costs related to the release, including state or federal civil or criminal enforcement proceedings, cannot be reasonably estimated at this time. Duke Energy Indiana Edwardsport IGCC On December 11, 2012, Duke Energy Indiana filed an arbitration action against General Electric Company and...

  • Page 159
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The table below presents ...

  • Page 160
    ...debt discount and premium, net(e) Unamortized debt issuance costs(f) Total debt Short-term notes payable and commercial paper Short-term money pool/intercompany borrowings Current maturities of long-term debt(g) Total long-term debt(g) 4.25% $ 6,727 (a) Substantially all electric utility property...

  • Page 161
    ... Tax-exempt bonds, maturing 2015 - 2041(c) Notes payable and commercial paper(d) Money pool/intercompany borrowings Fair value hedge carrying value adjustment Unamortized debt discount and premium, net(e) Unamortized debt issuance costs Total debt Short-term notes payable and commercial paper Short...

  • Page 162
    ... DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Maturities and Call Options The following table shows the annual maturities of long-term debt for the next five years and thereafter. Amounts presented exclude short-term notes payable and commercial paper...

  • Page 163
    ... commercial paper and for general corporate purposes. See Note 13 for additional information related to the redemption of Duke Energy Ohio's tax-exempt bonds. (b) The debt is ï¬,oating rate based on three-month London Interbank Offered Rate (LIBOR) plus a fixed credit spread of 38 basis points...

  • Page 164
    ... short-term debt obligations of Duke Energy and are reï¬,ected as Notes payable and commercial paper on Duke Energy's Consolidated Balance Sheets. At December 31, 2015 and 2014, $767 million of debt issued by Duke Energy Carolinas was guaranteed by Duke Energy. Money Pool The Subsidiary Registrants...

  • Page 165
    ... II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Money pool receivable balances...

  • Page 166
    ... Energy Florida pays all fuel and water costs during the remaining months. Other costs are allocated 66.67 percent to Duke Energy Florida and the remainder to GPC. (c) Jointly owned with America Electric Power Generation Resources and The Dayton Power and Light Company. (d) Jointly owned with Wabash...

  • Page 167
    ...Ohio also includes AROs related to the retirement of natural gas mains. Duke Energy also includes AROs related to the removal of renewable energy generation assets. North Carolina and South Carolina Ash Impoundments On September 20, 2014, the Coal Ash Act became law and was amended on June 24, 2015...

  • Page 168
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) of fuel source). The rule ...

  • Page 169
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Nuclear Operating Licenses ...

  • Page 170
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) 10. PROPERTY, PLANT AND ...

  • Page 171
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 Estimated ...

  • Page 172
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes To Consolidated Financial Statements - (Continued) 11. GOODWILL AND INTANGIBLE ...

  • Page 173
    ... II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 Duke Energy...

  • Page 174
    ...II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes To Consolidated Financial Statements - (Continued) The following table presents Duke...

  • Page 175
    ... other on the Consolidated Statements of Operations and Comprehensive Income. (c) Duke Energy Carolinas and Duke Energy Progress participate in a JDA which allows the collective dispatch of power plants between the service territories to reduce customer rates. Revenues from the sale of power under...

  • Page 176
    ... OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes To Consolidated Financial Statements - (Continued) 14. DERIVATIVES AND HEDGING the future transaction effects earnings. Amounts for interest rate contracts are reclassified to earnings as interest expense over the term of the related debt...

  • Page 177
    ... Registrants have netted contractual amounts where offsetting purchase and sale contracts exist with identical delivery locations and times of delivery. Where all commodity positions are perfectly offset, no quantities are shown. December 31, 2015 Duke Energy Electricity (gigawatt-hours) Natural gas...

  • Page 178
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) LOCATION AND FAIR VALUE OF ...

  • Page 179
    ... ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Derivative Assets (in millions) Commodity Contracts Not Designated...

  • Page 180
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) OFFSETTING ASSETS AND ...

  • Page 181
    ... ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Derivative Assets (in millions) Current...

  • Page 182
    ... Energy Progress, Duke Energy Florida and Duke Energy Indiana related to OPEB plans, (iii) Duke Energy's captive insurance investment portfolio, and (iv) Duke Energy's foreign operations investment portfolio. Duke Energy classifies all other investments in debt and equity securities as long term...

  • Page 183
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Investments within the ...

  • Page 184
    ...DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The table below summarizes the maturity date for debt securities...

  • Page 185
    ... PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Realized gains and losses, which were determined on a specific identification basis, from sales of available-for-sale securities...

  • Page 186
    ..., LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY PROGRESS The following table presents the estimated fair value of investments in available-for-sale securities. December 31, 2015...

  • Page 187
    ..., LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY FLORIDA The following table presents the estimated fair value of investments in available-for-sale securities. December 31, 2015 Gross Unrealized Holding...

  • Page 188
    ...DUKE ENERGY PROGRESS, LLC • DUKE ENERGY FLORIDA, LLC • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY INDIANA The following table presents the estimated fair value of investments in available-for-sale securities...

  • Page 189
    ... DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) 16. FAIR VALUE MEASUREMENTS Investments in equity securities...

  • Page 190
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY The following ...

  • Page 191
    ...ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 (in millions) Balance...

  • Page 192
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) PROGRESS ENERGY The ...

  • Page 193
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY FLORIDA The ...

  • Page 194
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY OHIO The ...

  • Page 195
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The following table ...

  • Page 196
    ... that could have been settled in current markets. Fair value of long-term debt uses Level 2 measurements. December 31, 2015 (in millions) Duke Energy Duke Energy Carolinas Progress Energy Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Book Value $ 39,569 8,367 14,464...

  • Page 197
    ... INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) CONSOLIDATED VIEs The following tables summarize the impact of VIEs consolidated by Duke Energy and the Subsidiary Registrants on the Consolidated Balance Sheets. December 31, 2015 Duke Energy Duke Energy Carolinas...

  • Page 198
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 Duke Energy Duke...

  • Page 199
    ... The sole source of funds to satisfy the related debt obligation is cash collections from the receivables. The credit facility expires in December 2018 and is reï¬,ected on Duke Energy's Consolidated Balance Sheets as Long-Term Debt. The proceeds Duke Energy Ohio and Duke Energy Indiana receive from...

  • Page 200
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 Duke Energy Duke...

  • Page 201
    ... CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Key assumptions used in estimating fair value...

  • Page 202
    ... Statements of Operations. Duke Energy $ 142 Duke Energy Carolinas $ 93 Progress Energy $ 36 Duke Energy Progress $ 28 Duke Energy Florida $ 8 Duke Energy Ohio $ 2 Duke Energy Indiana $ 6 (in millions) Year Ended December 31, 2015 In conjunction with the 2012 merger with Progress Energy, Duke...

  • Page 203
    ... expense recognized by the Duke Energy Registrants, net of tax, for stock-based compensation. Years Ended December 31, (in millions) Duke Energy Duke Energy Carolinas Progress Energy Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana 2015 $ 38 14 14 9 5 2 4 2014 $ 38 12 14...

  • Page 204
    ... CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The following table summarizes information...

  • Page 205
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) 21. EMPLOYEE BENEFIT PLANS...

  • Page 206
    ... DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Year Ended December 31, 2014 Duke...

  • Page 207
    ...II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Reconciliation of Funded Status...

  • Page 208
    ...CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Amounts Recognized in the Consolidated Balance...

  • Page 209
    ..., Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio and Duke Energy Indiana. The following tables present the assumptions or range of assumptions used for pension benefit accounting. December 31, 2015 Benefit Obligations Discount rate Salary increase Net Periodic Benefit Cost Discount...

  • Page 210
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Year Ended December 31, 2014 Duke...

  • Page 211
    ...II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Reconciliation of Funded Status...

  • Page 212
    ...CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Amounts Recognized in the Consolidated Balance...

  • Page 213
    ... Energy Ohio and Duke Energy Indiana, 12 years for Duke Energy Progress and 17 years for Duke Energy Florida. The following tables present the assumptions used for pension benefit accounting. December 31, 2015 Benefit Obligations Discount rate Salary increase Net Periodic Benefit Cost Discount...

  • Page 214
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Year Ended December 31, 2014 Duke...

  • Page 215
    ...II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Reconciliation of Funded Status...

  • Page 216
    ... the market value of the bonds selected. The following tables present the assumptions used for other post-retirement benefits accounting. December 31, 2015 Benefit Obligations Discount rate Net Periodic Benefit Cost Discount rate Expected long-term rate of return on plan assets Assumed tax rate...

  • Page 217
    ... DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Assumed Health Care Cost Trend Rate December 31, 2015 Health...

  • Page 218
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) PLAN ASSETS Description ...

  • Page 219
    ... fair value measurement amounts for the Duke Energy Master Retirement Trust qualified pension and other post-retirement assets. December 31, 2015 (in millions) Equity securities Corporate debt securities Short-term investment funds Partnership interests Hedge funds Real estate limited partnerships...

  • Page 220
    ... DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 (in millions) Equity securities Corporate debt securities Short-term investment funds Partnership interests Hedge funds Real estate...

  • Page 221
    ... CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The following table includes pretax employer...

  • Page 222
    ... DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Year Ended December 31, 2014 Duke...

  • Page 223
    ... II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Statutory Rate Reconciliation...

  • Page 224
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) Valuation allowances have ...

  • Page 225
    ... obligations and debt fair value adjustments. On July 23, 2013, HB 998 was signed into law. HB 998 reduces the North Carolina corporate income tax rate from a statutory 6.9 percent to 6.0 percent in January 2014 with a further reduction to 5.0 percent in January 2015. Duke Energy recorded a net...

  • Page 226
    ... II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 Duke Energy...

  • Page 227
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) The following table ...

  • Page 228
    ...DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) 23. OTHER INCOME AND EXPENSES, NET...

  • Page 229
    ... II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) 25. QUARTERLY FINANCIAL DATA...

  • Page 230
    PART II DUKE ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) PROGRESS ENERGY First ...

  • Page 231
    ... ENERGY CORPORATION • DUKE ENERGY CAROLINAS, LLC • PROGRESS ENERGY, INC. • DUKE ENERGY PROGRESS, LLC. • DUKE ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) DUKE ENERGY OHIO (in millions) 2015...

  • Page 232
    ... and procedures designed to provide reasonable assurance that information required to be disclosed by the Duke Energy Registrants in the reports they file or submit under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Of...

  • Page 233
    ...Indiana $1.2 - 0.1 $1.3 (in millions) Types of Fees Audit Fees(a) Audit-Related Fees(b) Tax Fees(c) Total Fees (a) Audit Fees are fees billed or expected to be billed for professional services for the audit of the Duke Energy Registrants' financial statements included in the annual report on Form...

  • Page 234
    ... Financial Statements) Report of Independent Registered Public Accounting Firm All other schedules are omitted because they are not required, or because the required information is included in the Consolidated Financial Statements or Notes. Duke Energy Florida, LLC (formerly Duke Energy Florida...

  • Page 235
    ...of Changes in Equity for the Years Ended December 31, 2015, 2014 and 2013 Notes to the Consolidated Financial Statements Quarterly Financial Data, (unaudited, included in Note 25 to the Consolidated Financial Statements) Report of Independent Registered Public Accounting Firm All other schedules are...

  • Page 236
    ... 25, 2016 DUKE ENERGY CORPORATION (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chairman, President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the...

  • Page 237
    ...: February 25, 2016 DUKE ENERGY CAROLINAS, LLC (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities...

  • Page 238
    ...Date: February 25, 2016 PROGRESS ENERGY, INC. (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and...

  • Page 239
    ...Date: February 25, 2016 DUKE ENERGY PROGRESS, LLC (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities...

  • Page 240
    ... Date: February 25, 2016 DUKE ENERGY FLORIDA, LLC (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities...

  • Page 241
    .... Date: February 25, 2016 DUKE ENERGY OHIO, INC. (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities...

  • Page 242
    ... Date: February 25, 2016 DUKE ENERGY INDIANA, LLC (Registrant) By: /s/ LYNN J. GOOD Lynn J. Good Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities...

  • Page 243
    ... Item 15(b) of Form 10-K is designated by a plus (+). Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 2.1 Agreement and Plan of Merger between Duke Energy Corporation, Diamond Acquisition Corporation and Progress Energy, Inc., dated...

  • Page 244
    ... Indiana Exhibit Number 3.6 Limited Liability Company Operating Agreement of Duke Energy Carolinas, LLC (incorporated by reference to Exhibit 3.2 to registrant's Current Report on Form 8-K filed on April 7, 2006, File No. 1-4928). Regulations of Duke Energy Ohio, Inc. (formerly The Cincinnati Gas...

  • Page 245
    PART IV Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 4.2.2 Second Supplemental Indenture, dated as of January 26, 2009, (incorporated by reference to Exhibit 4.1 to Duke Energy Corporation's Current Report on Form 8-K filed on ...

  • Page 246
    ... IV Duke Energy Carolinas X Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 4.4.1 Instrument of Resignation, Appointment and Acceptance among Duke Energy Carolinas, LLC, JPMorgan Chase Bank, N.A., as Trustee, and The Bank of New York Mellon Trust Company...

  • Page 247
    ... IV Duke Energy Carolinas Duke Energy Progress X Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 4.5 Mortgage and Deed of Trust between Duke Energy Progress, Inc. (formerly Carolina Power & Light Company) and The Bank of New York Mellon (formerly Irving Trust Company) and...

  • Page 248
    ... by reference to Exhibit 4.1 to Duke Energy Progress, LLC's Current Report on Form 8-K filed on August 13, 2015, File No. 1-3382). Indenture (for Debt Securities) between Duke Energy Progress, Inc. (formerly Carolina Power & Light Company) and The Bank of New York Mellon (successor in interest to...

  • Page 249
    ... Florida Power Corporation (d/b/a Progress Energy Florida, Inc.)) Registration Statement on Form S-3 filed on November 18, 2008, File No. 333-155418). Original Indenture (Unsecured Debt Securities) between Duke Energy Ohio, Inc. (formerly The Cincinnati Gas & Electric Company) and The Bank of New...

  • Page 250
    ... Energy Progress Duke Energy Florida Duke Energy Ohio X Duke Energy Indiana Exhibit Number 4.11.1 First Supplemental Indenture, dated as of June 1, 1995, (incorporated by reference to Exhibit 4 B to Duke Energy Ohio, Inc.'s (formerly The Cincinnati Gas & Electric Company) Quarterly Report on Form...

  • Page 251
    ... Energy Ohio Duke Energy Indiana X X Exhibit Number 4.14.5 4.14.6 Thirtieth Supplemental Indenture, dated as of August 1, 1980, (filed as an exhibit in File No. 2-68562). Thirty-fifth Supplemental Indenture, dated as of March 30, 1984, (filed as an exhibit to registrant's Annual Report on Form...

  • Page 252
    ...reference to Exhibit 4.1 to registrant's Current Report on Form 8-K filed on December 1, 2000, File No. 1-3382). Forty-second Supplemental Indenture between Duke Energy Ohio, Inc. (formerly The Cincinnati Gas & Electric Company) and The Bank of New York Mellon Trust Company, N.A., as Trustee, dated...

  • Page 253
    PART IV Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 10.2** Directors' Charitable Giving Program (incorporated by reference to Exhibit 10-P to Duke Energy Carolinas, LLC's Annual Report on Form 10-K for the year ended December 31...

  • Page 254
    ... LLC and Duke Energy Ohio, Inc. (formerly The Cincinnati Gas & Electric Company), dated as of April 10, 2006, (incorporated by reference to Exhibit 10.1 to registrant's Current Report on Form 8-K filed on April 14, 2006, File No. 1-1232). Agreements between Piedmont Electric Membership Corporation...

  • Page 255
    ... Directors' Saving Plan, dated as of January 1, 2014, (incorporated by reference to Exhibit 10.32 to Duke Energy Corporation's Annual Report on Form 10-K for the year ended December 31, 2013, filed on February 28, 2014, File No. 1-32853). Engineering, Procurement and Construction Management...

  • Page 256
    ... Energy Indiana X Exhibit Number 10.28 $6,000,000,000 Five-Year Credit Agreement between Duke Energy Corporation, Duke Energy Carolinas, LLC, Duke Energy Ohio, Inc., Duke Energy Indiana, Inc., Duke Energy Kentucky, Inc., Carolina Power and Light Company d/b/a Duke Energy Progress, Inc. and Florida...

  • Page 257
    PART IV Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 10.35** Form of Performance Award Agreement of Duke Energy Corporation under the Duke Energy Corporation 2015 Long-Term Incentive Plan (incorporated by reference to Exhibit 10...

  • Page 258
    ... Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana Exhibit Number 10.47+ Form of Letter Agreement executed by certain officers of Progress Energy, Inc., waiving certain rights under Progress Energy, Inc.'s Management Change-inControl Plan and their employment...

  • Page 259
    ...Indiana Exhibit Number *10.55** Duke Energy Corporation 2016 Director Compensation Program Summary 10.56** Amended and Restated Duke Energy Corporation Executive Savings Plan, dated as of January 1, 2014, (incorporated by reference to Exhibit 10.82 to Duke Energy Corporation's Annual Report on Form...

  • Page 260
    ... of Independent Registered Public Accounting Firm. Power of attorney authorizing Lynn J. Good and others to sign the annual report on behalf of the registrant and certain of its directors and officers. Certified copy of resolution of the Board of Directors of the registrant authorizing power of...

  • Page 261
    PART IV Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X Duke Energy Indiana Exhibit Number *32.1.6 *32.1.7 *32.2.1 *32.2.2 *32.2.3 *32.2.4 *32.2.5 *32.2.6 *32.2.7 *...

  • Page 262

  • Page 263
    Investor Information Annual Meeting The 2016 Annual Meeting of Duke Energy Shareholders will be: Date: Thursday, May 5, 2016 Time: Place: 10 a.m. O.J. Miller Auditorium Energy Center 526 South Church Street Charlotte, NC 28202 Financial Publications Duke Energy's Annual Report and related ...

  • Page 264
    ON THE COVER: Thank you to all our customers, including Cary and her son Joel of Raleigh, North Carolina. WWW.DUKE-ENERGY.COM