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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
    ... 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 Ahead framework throughout Duke...

  • Page 3
    ... our investors expect. I encourage you to read on to learn more of what we accomplished and set in motion at Duke Energy in 2015 and early 2016. You will gain insights into the issues we're wrestling with, the way we think about the future and how we're generating what's next. 2015 ANNUAL REPORT...

  • Page 4
    ... 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 2013...

  • Page 5
    ...key part of the U.S. energy future as we retire more coal plants, move toward a low-carbon future and build clean generation capacity that can operate night and day. In October 2015, we announced our plan to purchase Piedmont Natural Gas for $4.9 billion in cash. Based here in Charlotte, Piedmont is...

  • Page 6
    ... power plant in Citrus County, Florida, scheduled for 2018. Like natural gas, renewable energy is critical for our future. We had strong solar growth in 2015. Duke Energy Renewables, our commercial business unit, built eight large solar projects in North Carolina. Additionally, our regulated utility...

  • 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...

  • Page 8
    ...." Dhiaa Jamil Executive Vice President and President - 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...

  • Page 9
    ... joint power generation in the Carolinas as a result of the July 2012 Duke Energy-Progress Energy merger. Seventy percent of the way through the first five years, we've already achieved 90 percent of the $687 million guaranteed savings. Customers expect safe, reliable, costeffective operations, and...

  • Page 10
    ... boundaries. Externally, we will work with diverse stakeholders to update the regulatory rules, as needed, "Technology is changing how we look at everything from power generation and delivery to the customer experience." A.R. Mullinax Executive Vice President - Strategic Services \ 8 \ DUKE ENERGY

  • Page 11
    ...21,000 hours of community service. We worked closely with many regional community groups and interested parties to secure the November 2015 federal approval of Duke Energy's license to manage the Catawba River for 40 more years. We operate 23 powerhouses and 11 reservoirs in the Carolinas along this...

  • Page 12
    ...the new transmission line, we paused, listened and took a closer look. After our engineers reconfigured the project, we gained widespread support. For the 10th consecutive year, Duke Energy was named to the Dow Jones Sustainability Index for North America, one of only four electric utilities in 2015...

  • Page 13
    ... are 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...

  • Page 14
    ... Capital Management, LLC Chair, Regulatory Policy and Operations Committee Member, Audit Committee, Finance and Risk Management Committee Director of Duke Energy since 2012 John H. Forsgren Retired Vice Chairman, Executive Vice President and Chief Financial Officer - Northeast Utilities Member...

  • 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
    ...Crystal River Unit 3 and other nuclear facilities could prove to be more extensive than amounts estimated and all costs may not be fully recoverable through the regulatory process; credit ratings of Duke Energy Corporation, Duke Energy Carolinas, LLC, Progress Energy, Inc., Duke Energy Progress, LLC...

  • Page 18
    ... Operations on a GAAP basis. This impact to state income taxes has been excluded from the Commercial Portfolio segment for adjusted diluted EPS purposes as management believes these impacts are incidental to the sale of the Disposal Group. Derivative contracts are used in Duke Energy's hedging...

  • Page 19
    ... EPS for 2011: Year Ended December 31, 2011 Regulated Utilities $ 1,316 - (135) - - - $ 1,181 International Energy $ 466 466 Commercial Portfolio $ 186 (291) - - (2) - $ (107) Total Reportable Segments $ 1,968 (291) (135) - (2) - $ 1,540 Eliminations/ Discontinued Duke Operations Energy $ - 283...

  • Page 20
    (This page intentionally left blank.)

  • Page 21
    ... PROGRESS, INC.) (a North Carolina limited liability company) 410 South Wilmington Street Raleigh, North Carolina 27601-1748 704-382-3853 56-0165465 DUKE ENERGY CORPORATION 20-2777218 Commission file number Commission file number Registrant, State of Incorporation or Organization, Address...

  • Page 22
    ... performance standards, as well as the ability to recover costs from customers in a timely manner or at all; • Changes in rules for regional transmission organizations, including changes in rate designs and new and evolving capacity markets, and risks related to obligations created by the default...

  • 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
    ...the United States Gas Settlement ...Settlement agreement in 2013 among Duke Energy Ohio, PUCO Staff and intervening parties GHG...Greenhouse Gas GPC...Georgia Power Company GWh ...Gigawatt-hours Harris ...Shearon Harris Nuclear Plant HB 998 ...North Carolina House Bill 998, or the North Carolina Tax...

  • Page 25
    ...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 PJM ...PJM Interconnection, LLC Plea Agreements ...Plea Agreements entered into by Duke...

  • Page 26
    ... corporation. Piedmont is an energy services company primarily engaged in the distribution of natural gas to residential, commercial, industrial and power generation customers in portions of North Carolina, South Carolina and Tennessee. Under terms of the Merger Agreement, Duke Energy will acquire...

  • Page 27
    ... service. 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...

  • Page 28
    ....1% 100.0% Nuclear(a) Natural gas and oil(a) All fuels (cost-based on weighted average)(a) Hydroelectric and solar(b) Total generation Purchased power and net interchange(c) Total sources of energy (a) (b) (c) (d) (e) Statistics related to all fuels reï¬,ect Regulated Utilities' ownership interest...

  • Page 29
    ... Purchases capacity under contract (in MW) (b) Natural Gas and Oil Natural gas and oil supply for Regulated Utilities' generation ï¬,eet is purchased under term and spot contracts from various suppliers. Duke Energy Carolinas, Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana use...

  • Page 30
    ... Progress and Duke Energy Florida will continue to safely manage their spent nuclear fuel. Under current regulatory guidelines, Harris Nuclear Plant has sufficient storage capacity in its spent fuel pools through the expiration of its renewed operating license. Crystal River Unit 3 was retired...

  • Page 31
    ... for fuel costs and recovery from customers can adversely impact the timing of cash ï¬,ows of Regulated Utilities. The following table summarizes base rate cases approved and effective in the past three years. Annual Increase (in millions) Duke Energy Carolinas 2013 North Carolina Rate Case(a) Duke...

  • Page 32
    ... credits (PTC) as power is generated by the project over 10 years. Renewable ITC are recognized over the useful life of the asset with the benefit of the tax basis adjustment due to the ITC recognized in income in the year of commercial availability. OTHER The remainder of Duke Energy's operations...

  • Page 33
    ... Utilities from December 2012 to August 2014, and prior to that, had served as Executive Vice President, Customer Operations since July 2012, upon the merger of Duke Energy and Progress Energy. Prior to the merger, Mr. Yates was President and Chief Executive Officer of Progress Energy Carolinas...

  • Page 34
    ... Financial Statements, "Business Segments." DUKE ENERGY CAROLINAS Duke Energy Carolinas is a regulated public utility primarily engaged in the generation, transmission, distribution, and sale of electricity in portions of North Carolina and South Carolina. Duke Energy Carolinas' service area...

  • Page 35
    ... and related activities, which may limit their ability to recover costs. The Duke Energy Registrants' regulated utility businesses are regulated on a cost-of-service/rate-of-return basis subject to statutes and regulatory commission rules and procedures of North Carolina, South Carolina, Florida...

  • Page 36
    ... overall sales and lessen cash ï¬,ows, especially as industrial customers reduce production and, therefore, consumption of electricity. Although the Duke Energy Registrants' regulated electric business is subject to regulated allowable rates of return and recovery of certain costs, such as fuel...

  • Page 37
    ...locations for use as structural fill and to off-site or on-site lined landfills. At other sites, preliminary planning and closure methods have been studied and factored into the estimated retirement and management costs. Coal Ash Act requires CCR surface impoundments in North Carolina to be closed...

  • Page 38
    ... businesses. In particular, the Duke Energy Registrants may experience increased capital and operating costs to implement increased security for their information technology systems, transmission and distribution and generation facilities, including nuclear power plants under the NRC's design basis...

  • Page 39
    ... some cases, may expose Duke Energy to other risks that could negatively affect its cash ï¬,ows and results of operations. The costs of retiring Duke Energy Florida's Crystal River Unit 3 could prove to be more extensive than is currently identified. Costs to retire and decommission the plant could...

  • Page 40
    ... below projected rates of return. Although a number of factors impact funding requirements, a decline in the market value of the assets may increase the funding requirements of the obligations for decommissioning nuclear plants. If Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida...

  • 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
    .../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 Units...

  • Page 43
    ...,400 19,600 500 - - 300 7,200 5,800 Substantially all of Regulated Utilities' electric plant in service is mortgaged under indentures relating 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...

  • Page 44
    ... 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 Campbell Hill North Allegheny...

  • Page 45
    ... "Commitments and Contingencies," to the Consolidated Financial Statements. Brazilian electricity regulatory agency (ANEEL) (collectively, the Resolutions). The Resolutions purport to impose additional transmission fees on generation companies located in the State of Sao Paulo for utilization of the...

  • Page 46
    ... expects to continue its policy of paying regular cash dividends; however, there is no assurance as to the amount of future dividends as they depend on future earnings, capital requirements, and financial condition, and are subject to declaration by the Duke Energy Board of Directors. Securities...

  • Page 47
    ... 2011 2012 2013 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...

  • Page 48
    ... 31, 2015, 2014 and 2013. Executive Overview Acquisition of Piedmont Natural Gas On October 24, 2015, Duke Energy entered into an Agreement and Plan of Merger (Merger Agreement) with Piedmont Natural Gas Company, Inc., (Piedmont) a North Carolina corporation. Under the terms of the Merger Agreement...

  • Page 49
    ...Midwest generation business and Duke Energy Retail Sales LLC (collectively, the Disposal Group) to a subsidiary of Dynegy on April 2, 2015, for approximately $2.8 billion in cash. Refer to Note 2 to the Consolidated Financial Statements, "Acquisitions and Dispositions," for additional information on...

  • Page 50
    ... on customers, employees, operations and growth. Duke Energy announced the acquisition of Piedmont, completed the purchase of North Carolina Eastern Municipal Power Agency's (NCEMPA) generation assets, completed the sale of the nonregulated Midwest Generation business and executed on the coal ash...

  • Page 51
    ... 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 projects, a utility scale solar power plant and...

  • 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
    ... Income Taxes Income Tax Expense Segment Income Duke Energy Carolinas Gigawatt-Hours (GWh) sales Duke Energy Progress GWh sales Duke Energy Florida GWh sales Duke Energy Ohio GWh sales Duke Energy Indiana GWh sales Total Regulated Utilities GWh sales Net proportional MW capacity in operation 2015...

  • Page 55
    ... North Carolina gross receipts tax effective July 1, 2014. Operating Expenses. The variance was driven primarily by: • a $611 million increase in fuel expense (including purchased power and natural gas purchases for resale) primarily related to (i) higher volumes of coal, and oil used in electric...

  • Page 56
    ... 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 Regulated Utilities' future results of operations and ongoing cash ï¬,ows as it would no longer earn an equity return...

  • Page 57
    ... in 2014. Year Ended December 31, 2014 as Compared to 2013 International Energy's results were negatively impacted by higher tax expense resulting from the decision to repatriate historical undistributed foreign earnings, unfavorable hydrology and exchange rates in Brazil and an unplanned outage in...

  • Page 58
    .... The increase in the effective tax rate was also primarily due to the tax expense associated with the repatriation decision. Matters Impacting Future International Energy Results International Energy's operations include conventional hydroelectric power generation facilities located in Brazil...

  • Page 59
    ... changes to state apportionment factors on deferred taxes due to the Disposal Group sale. Year Ended December 31, 2014 as Compared to 2013 Commercial Portfolio's results were impacted by higher production tax credits generation, higher production and lower operating costs by the renewables business...

  • Page 60
    PART II Year Ended December 31, 2015 as Compared to 2014 Other's results were impacted by lower Progress Energy merger costs, an increase in income tax benefit, severance accruals, and higher North Carolina franchise taxes. The following is a detailed discussion of the variance drivers by line item...

  • Page 61
    ... year base rate step-up from the 2013 South Carolina rate case; • a $51 million increase from retail sales growth; and • a $40 million increase in wholesale power revenues, net of sharing, primarily due to additional volumes for customers served under longterm contracts. Operating Expenses...

  • Page 62
    ... Carolinas could incur increased fuel, purchased power, operation and maintenance, and 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...

  • Page 63
    ...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 Progress Energy's future results of operations and ongoing cash ï¬,ows as it would no longer earn an equity return...

  • Page 64
    ... 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-up from the 2013 North Carolina retail rate case; and • a $26 million increase in fuel revenues...

  • 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
    ... 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 results of operations and ongoing cash ï¬,ows as it would no longer earn an equity return...

  • Page 67
    ... and to public and private utilities and power marketers. Amounts are not weather normalized. (Decrease) increase over prior year Residential sales General service sales Industrial sales Wholesale power sales Total sales Average number of customers 2015 (2.2)% (0.1)% 0.4% 222.3% 2.8% 0.7% 2014...

  • Page 68
    ... and to public and private utilities and power marketers. Amounts are not weather normalized. (Decrease) increase over prior year Residential sales General service sales Industrial sales Wholesale power sales Total sales Average number of customers 2015 (4.1)% (0.5)% (1.4)% 9.4% 0.3% 0.8% 2014...

  • Page 69
    ... 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 Indiana continues to evaluate the need to retire generating facilities and plans to seek...

  • Page 70
    ... IGCC Plant and the retired Crystal River Unit 3 Nuclear Plant. When it becomes probable that regulated generation, transmission or distribution assets will be abandoned, the cost of the asset is removed from plant in service. The value that may be retained as a regulatory asset on the balance sheet...

  • Page 71
    ... service requirements at retirement, as defined in the plans. As of December 31, 2015, Duke Energy assumes pension and other postretirement plan assets will generate a long-term rate of return of 6.50 percent. The expected long-term rate of return was developed using a weighted average calculation...

  • Page 72
    ... the security of plan benefits for participants. VEBA I is passively managed. Duke Energy discounted its future U.S. pension and other post-retirement obligations using a rate of 4.4 percent as of December 31, 2015. Discount rates used to measure benefit plan obligations for financial reporting...

  • Page 73
    ... Balance Sheets. (c) On May 14, 2015, the United States District Court for the Eastern District of North Carolina approved the separate Plea Agreements entered into by Duke Energy Carolinas, Duke Energy Progress and Duke Energy Business Services, LLC (DEBS), a wholly owned subsidiary of Duke Energy...

  • Page 74
    ... owned public utility operating companies have restrictions on the amount of funds that can be transferred to Duke Energy through dividends, advances or loans as a result of conditions imposed by various regulators in conjunction with merger transactions. Duke Energy Progress and Duke Energy Florida...

  • Page 75
    ... and natural gas and costs of operations. Weather conditions, working capital and commodity 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...

  • Page 76
    ...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 variance was driven primarily by: • a $2,789 million increase in proceeds mainly due to sale of the nonregulated Midwest generation business to...

  • Page 77
    ... 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 (123...

  • Page 78
    ... $ 2,922 Duke Energy Florida - - - - 225 - - - - - 225 $ $ (a) Proceeds were used to redeem $402 million of tax-exempt bonds at Duke Energy Ohio, the repayment of outstanding commercial paper and for general corporate purposes. See Note 13 to the Consolidated Financial Statements, "Related Party...

  • 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
    ... Financial Statements is required until settlement of the contract as long as the transaction remains probable of occurring. Generation Portfolio Risks Duke Energy is primarily exposed to market price ï¬,uctuations of wholesale power, natural gas, and coal prices in the Regulated Utilities...

  • Page 81
    ... 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 Energy...

  • Page 82
    ... and state utility commissions and via wholesale contracts, which permit recovery of necessary and prudently incurred costs associated with Duke Energy's regulated operations. For more information, see Note 9 to the Consolidated Financial Statements, "Asset Retirement Obligations." Duke Energy Ohio...

  • Page 83
    ...the Duke Energy Registrants. 63 The Duke Energy Registrants also expect to incur increased fuel, purchased power, operation and maintenance and other expenses, in addition to costs for replacement generation for potential coal-fired power plant retirements, as a result of these regulations. Actual...

  • Page 84
    ... CPP rule and are working with states to identify the best approach for developing state plans that will establish the regulatory requirements applicable to the Duke Energy Registrants. The Duke Energy Registrants could incur increased fuel, purchased power, operation and maintenance and other costs...

  • Page 85
    ...(Duke Energy Progress) 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...Duke Energy Florida, LLC (formerly...

  • Page 86
    ...REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders of 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...

  • Page 87
    ... in electric generation and purchased power - 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...

  • Page 88
    ...-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 million tax expense in 2013. See...

  • Page 89
    ... in equity method unconsolidated affiliates Nuclear decommissioning trust funds Goodwill Assets held for sale Other Total investments and other assets Property, Plant and Equipment Cost Accumulated depreciation and amortization Generation facilities to be retired, net Net property, plant and...

  • Page 90
    ...for sale Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Common stock, $0.001 par value, 2 billion shares authorized; 688 million and 707 million shares outstanding at December 31, 2015 and 2014, respectively...

  • Page 91
    ... Acquisitions, net of cash acquired Purchases of available-for-sale securities Proceeds from sales 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...

  • Page 92
    PART II DUKE ENERGY CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS - (Continued) Years Ended December 31, (in millions) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the: Issuance of long-term debt Issuance of common stock related to employee benefit plans Payments for the: Redemption of ...

  • Page 93
    ...to noncontrolling interests. (b) The $25 million change in Noncontrolling Interests is primarily related to the acquisitions of a majority interest in a provider of energy management systems and services for commercial customers and a solar company. See Notes to Consolidated Financial Statements 73

  • Page 94
    ... REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors of Duke Energy 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...

  • Page 95
    PART 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...

  • Page 96
    ... costs Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Member's Equity Accumulated other comprehensive loss Total equity Total Liabilities and Equity See Notes to Consolidated Financial Statements 2015 2014...

  • Page 97
    ...nuclear fuel) Equity component of AFUDC FERC mitigation costs Losses 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...

  • 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
    ... ACCOUNTING FIRM To the Board of Directors of Progress 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...

  • Page 100
    ...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 other taxes Impairment charges Total operating expenses Gains on Sales of...

  • 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
    ... and other post-retirement benefit costs Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Common stock, $0.01 par value, 100 shares authorized and outstanding at December 31, 2015 and 2014 Additional paid-in...

  • Page 103
    ... Asset acquisition Purchases of available-for-sale securities Proceeds from sales and maturities of available-for-sale securities Proceeds from the sale of nuclear fuel Notes receivable from affiliated companies Other Net cash used in investing activities See Notes to Consolidated Financial...

  • Page 104
    ... (received from) paid for income taxes Significant non-cash transactions: Accrued capital expenditures See Notes to Consolidated Financial Statements 2015 1,186 (1,553) - 623 (4) 625 (2) 875 2 42 $ 44 $ 2014 1,572 (931) - (378) (37) - (42) 184 (16) 58 42 $ 2013 845 (1,196) (96) 758 (3) - (6) 302...

  • 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 $ 10,185 675...

  • Page 106
    ... 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 of operations and comprehensive income, changes in equity, and cash ï¬,ows for each of the three years in...

  • 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
    ...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, no par; 200 million shares authorized; 160 million shares outstanding at December 31, 2014 Retained...

  • Page 109
    ... cash provided by operating activities: Depreciation, amortization and accretion (including amortization of nuclear fuel) Equity component of AFUDC FERC mitigation costs Community support and charitable contributions expense Gains on sales of other assets and other, net Impairment charges Deferred...

  • Page 110
    ...II DUKE ENERGY PROGRESS, 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...

  • Page 111
    ... of Duke Energy Florida, LLC and subsidiaries (the "Company") (formerly Duke Energy Florida, Inc. and subsidiaries) as of December 31, 2015 and 2014, and the related consolidated statements of operations and comprehensive income, changes in equity, and cash ï¬,ows for each of the three years in...

  • 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
    ...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, no par; 60 million shares authorized; 100 shares outstanding at December 31, 2014...

  • Page 114
    ... by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures Purchases of available-for-sale securities Proceeds from sales and maturities of available-for-sale securities Proceeds from the sale of nuclear fuel Notes receivable from affiliated companies Other Net cash used in...

  • Page 115
    ... ENERGY 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...

  • Page 116
    ... REGISTERED 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...

  • Page 117
    ... Fuel used in electric generation and purchased power - 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 on Sales...

  • Page 118
    ... assets held for sale Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Common stock, $8.50 par value, 120,000,000 shares authorized; 89,663,086 shares outstanding at December 31, 2015 and 2014 Additional paid...

  • Page 119
    ... and 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...

  • Page 120
    ... income Balance at December 31, 2013 Net loss Dividends to parent Balance at December 31, 2014 Net income Dividends to parent Distribution of membership interest of Duke Energy SAM, LLC to parent Balance at December 31, 2015 Pension and OPEB Related Adjustments $ (1) - 1 Total Equity $ 5,166...

  • Page 121
    ... subsidiary (the "Company") (subsequently Duke Energy Indiana, LLC and subsidiary effective as of January 1, 2016) as of December 31, 2015 and 2014, and the related consolidated statements of operations and comprehensive income, changes in equity, and cash ï¬,ows for each of the three years in the...

  • Page 122
    ...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 other taxes Impairment charges Total operating expenses Gains on Sales of...

  • Page 123
    ... benefit costs Asset retirement obligations Regulatory liabilities Other Total deferred credits and other liabilities Commitments and Contingencies Equity Common Stock, no par; $0.01 stated value, 60,000,000 shares authorized; 53,913,701 shares outstanding at December 31, 2015 and December 31, 2014...

  • Page 124
    ... and amortization 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...

  • Page 125
    PART II DUKE ENERGY INDIANA, INC. (subsequently 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 ...

  • Page 126
    ... for regulatory accounting. On August 1, 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...

  • Page 127
    ... related to the operations of the Disposal Group. See Note 2 for additional information. For the years ended December 31, 2015, 2014 and 2013, Progress Energy's (Loss) Income From Discontinued Operations, net of tax was primarily due to tax impacts related to prior sales of diversified businesses...

  • Page 128
    ... those estimates. Regulatory Accounting The majority of the Duke Energy Registrants' operations are subject to price regulation for the sale of electricity and gas by state utility commissions or FERC. When prices are set on the basis of specific costs of the regulated operations and an effective...

  • Page 129
    ... allowances are based on the cost to acquire the allowances or, in the case of a business combination, on the fair value assigned in the allocation of the purchase price of the acquired business. Emission allowances are expensed to Fuel used in electric generation and purchased power - regulated on...

  • Page 130
    ... asset or liability. Obligations for nuclear decommissioning are based on-site-specific cost studies. Duke Energy Carolinas and Duke Energy Progress assume prompt dismantlement of the nuclear facilities after operations are ceased. Duke Energy Florida assumes Crystal River Unit 3 will be placed...

  • Page 131
    ... $ 2015 2014 $ 79 71 97 112 Allowance for Doubtful Accounts Allowances for doubtful accounts are presented in the following table. December 31, (in millions) Allowance for Doubtful Accounts Duke Energy Duke Energy Carolinas Progress Energy Duke Energy Progress Duke Energy Florida Duke Energy Ohio...

  • Page 132
    ... is accounted for and recognized at the time a loss is probable and can be reasonably estimated. See Note 7 for further information. Stock-Based Compensation Stock-based compensation represents costs related to stock-based awards granted to employees and Duke Energy Board of Directors (Board of...

  • Page 133
    ...million for Duke Energy Progress. HB 998 also increases sales tax on electricity from 3 percent to 7 percent effective July 1, 2014. HB 998 requires the NCUC to adjust retail electric rates for the elimination of the utility franchise tax, changes due to the increase in sales tax on electricity, and...

  • Page 134
    ... the purchase date. Acquisition of Piedmont Natural Gas On October 24, 2015, Duke Energy entered into an Agreement and Plan of Merger (Merger Agreement) with Piedmont Natural Gas Company, Inc. (Piedmont), a North Carolina corporation. Under the terms of the Merger Agreement, Duke Energy will acquire...

  • Page 135
    ... Portfolio (formerly Commercial Power) segment and classified as held for sale in 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...

  • Page 136
    ... and are subject to the rules and regulations of the FERC, NRC, NCUC, PSCSC, FPSC, PUCO, IURC and KPSC. International Energy principally operates and manages power generation facilities and engages in sales and marketing of electric power, natural gas and natural gas liquids outside the U.S. Its...

  • Page 137
    ...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 Regulated Utilities...

  • Page 138
    ... 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 Utilities recorded an impairment charge related to the letter Duke Energy Progress filed...

  • Page 139
    ... 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 Utilities $ 1,872...

  • Page 140
    ...DUKE ENERGY CAROLINAS, PROGRESS ENERGY, DUKE ENERGY PROGRESS, DUKE ENERGY FLORIDA AND DUKE ENERGY INDIANA The remaining Subsidiary Registrants each have one reportable operating segment, Regulated Utilities, which generates, transmits, distributes and sells electricity. The remainder of each company...

  • Page 141
    ... side management (DSM)/Energy efficiency (EE) Grid Modernization Vacation accrual Deferred fuel and purchased power Nuclear deferral Post-in-service carrying costs and deferred operating expenses Gasification services agreement buyout Transmission expansion obligation Manufactured gas plant (MGP...

  • Page 142
    ...fuel and purchased power Nuclear deferral Post-in-service carrying costs and deferred operating expenses Gasification services agreement buyout Transmission expansion obligation MGP Other Total regulatory assets Less: current portion Total noncurrent regulatory assets December 31, 2014 Duke Energy...

  • Page 143
    ...and Duke Energy Florida are required to pay interest on the outstanding liability balance. Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida collect a return on DSM/EE investments. Grid Modernization. Represents deferred depreciation and operating expenses as well as carrying costs...

  • Page 144
    ... rates for electric sales to wholesale customers served under cost-based rates (excluding Ohio and Indiana), as well as sales of transmission service. 124 On January 7, 2016, a customer group filed a complaint with the FERC that the rate of return on equity of 10.8 percent in Duke Energy Progress...

  • Page 145
    ... power services for the Brunswick Nuclear Plant. In June 2015, the Public Staff of the NCUC recommended the NCUC approve Duke Energy Progress' application. On August 3, 2015, the NCUC issued an order granting the application and requiring annual construction and cost progress reports. The new units...

  • Page 146
    ..., 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 billion Crystal River Unit...

  • Page 147
    ... work related to natural gas service lines that are customer-owned and for which it does not have valid records and, further, to relocate interior natural gas meters to suitable exterior locations where such relocation can be accomplished. Duke Energy Ohio projects total capital and operations...

  • Page 148
    ... with the DP&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...

  • Page 149
    ...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 and MTEP Cost...

  • Page 150
    ... meet rapidly growing demand for natural gas in those states. The primary customers of the Sabal Trail pipeline, Duke Energy Florida and Florida Power & Light Company, have each contracted 130 to buy pipeline capacity for 25-year initial terms. On February 3, 2016, the FERC issued an order granting...

  • Page 151
    ... agreements. Duke Energy Progress owns and operates the Robinson Nuclear Plant (Robinson), Brunswick and Harris. Robinson and Harris each have one reactor. Brunswick has two reactors. Duke Energy Florida manages and has a partial ownership interest in Crystal River Unit 3, which has been retired...

  • Page 152
    ... at a rate not to exceed $19 million per year per licensed reactor for each incident. The assessment may be subject to state premium taxes. Nuclear Property and Accidental Outage Coverage Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida are members of Nuclear Electric Insurance...

  • 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
    ...making relating to the leadership changes following the close of the Progress Energy merger in July 2012. By letter dated September 4, 2015, attorneys for the shareholders were informed that, on the recommendation of the Demand Review Committee formed to consider such matters, the Board of Directors...

  • Page 155
    ... 2011, the State of São Paulo sued Duke Energy International Geracao Paranapenema S.A. (DEIGP) in Brazilian state court. The lawsuit claims DEIGP is under a continuing obligation to expand installed generation capacity in the State of São Paulo by 15 percent pursuant to a stock purchase agreement...

  • Page 156
    ... 14, 2015, the United States District Court for the Eastern District of North Carolina approved the Plea Agreements. Under the Plea Agreements, DEBS and Duke Energy Progress pleaded guilty to four misdemeanor CWA violations related to violations at Duke Energy Progress' H.F. Lee Steam Electric Plant...

  • Page 157
    ... restitution, community service, mitigation and the funding of, and obligations under, the environmental compliance plans. As a result of the Plea Agreements, Duke Energy Carolinas and Duke Energy Progress recognized charges of $72 million and $30 million, respectively, in Operation, maintenance and...

  • Page 158
    ..., 2014, Duke Energy Progress and Duke Energy Florida filed a new action for costs incurred from 2011 through 2013 of $48 million and $25 million, respectively. Duke Energy Florida Class Action Lawsuit On February 22, 2016, Newton, et al v. Duke Energy Florida, LLC and Florida Power & Light Company...

  • Page 159
    ... utilities, wholesale marketers, co-generators, and qualified facilities. These purchased power contracts generally provide for capacity and energy payments. In addition, Duke Energy Progress and Duke Energy Florida have various contracts to secure transmission rights. The following table presents...

  • Page 160
    ... all electric utility property is mortgaged under mortgage bond indentures. (b) Duke Energy includes $114 million and $731 million of capital lease purchase accounting adjustments related to Duke Energy Progress and Duke Energy Florida, respectively, related to power purchase agreements that...

  • Page 161
    ...finance these balances on a long-term basis. The weighted average days to maturity for commercial paper was 27 days. (e) Duke Energy includes $1,975 million in purchase accounting adjustments related to the merger with Progress Energy. (f) Refer to Note 17 for additional information on amounts from...

  • Page 162
    ...paper(a) Total (in millions) Tax-exempt bonds Commercial paper Secured debt(b) Total $ (a) Progress Energy amounts are equal to Duke Energy Progress amounts. (b) In December 2015, Duke Energy used cash held by the lender to repay debt. Instrument had a term of less than one year with the right to...

  • Page 163
    ... outstanding 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...

  • Page 164
    ... with the investigation initiated by the USDOJ. Duke Energy Carolinas and Duke Energy Progress are required to each maintain $250 million of available capacity under the Master Credit Facility as security to meet their obligations under the Plea Agreements, in addition to certain other conditions...

  • Page 165
    ...or credit agreements contain material adverse change clauses. Other Loans As of December 31, 2015 and 2014, Duke Energy had loans outstanding of $629 million, including $41 million at Duke Energy Progress and $603 million, including $44 million at Duke Energy Progress, respectively, against the cash...

  • Page 166
    ... segment. On July 31, 2015, Duke Energy Progress completed the purchase of NCEMPA's ownership interests in jointly owned facilities. See Note 2 for additional information. Duke Energy Florida owns 98.3 percent interest in the retired Crystal River Unit 3 nuclear plant and is in the process...

  • Page 167
    ... Station. Coal-fired generation at W.S. Lee ceased in 2014 and unit 3 was converted to natural gas in March 2015. In July 2015, Duke Energy Progress executed a consent agreement with the SCDHEC requiring the excavation of an inactive ash fill area at the Robinson Plant within eight years. Coal ash...

  • Page 168
    ... with Duke Energy's regulated operations. Nuclear Decommissioning Liability Asset retirement obligations related to nuclear decommissioning are based on site-specific cost studies. The NCUC, PSCSC, and FPSC require updated cost estimates for decommissioning nuclear plants every five years. The...

  • Page 169
    ... for the years ended December 31, 2015 and 2014 relates to Duke Energy's regulated electric operations and has been deferred in accordance with regulatory accounting treatment. (b) For 2014, amounts relate to nuclear decommissioning of Crystal River Unit 3. For 2015, amounts primarily relate to ash...

  • 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
    ... generated by the renewable energy projects. Contingent lease payments were $172 million, $164 million and $154 million for the years ended December 31, 2015, 2014 and 2013. As of December 31, 2015, renewable energy projects owned by Duke Energy and accounted for as operating leases had a cost basis...

  • Page 172
    ...Consolidated Balance Sheets at December 31, 2015 and 2014. Progress Energy Progress Energy's Goodwill is included in the Regulated Utilities operating segment and there are no accumulated impairment charges. Impairment Testing Duke Energy, Duke Energy Ohio and Progress Energy perform annual goodwill...

  • Page 173
    ... following table presents amortization expense for gas, coal and power contracts, wind development rights and other intangible assets. December 31, (in millions) Duke Energy Duke Energy Ohio Duke Energy Indiana 2015 $ 4 - 1 2014 $ 6 2 1 2013 $ 13 8 1 The table below shows the expected amortization...

  • Page 174
    .... All of these entities own wind power projects in the United States. Duke Energy also owns a 50 percent interest in Duke American Transmission Co., LLC, which builds, owns and operates electric transmission facilities in North America. Duke Energy also owns a 40 percent and 7.5 percent interest in...

  • Page 175
    ... in Fuel used in electric generation and purchased power on the Consolidated Statements of Operations and Comprehensive Income. (d) In 2013, Progress Energy Service Company (PESC), a consolidated subsidiary of Progress Energy, charged a proportionate share of corporate governance and other costs to...

  • Page 176
    ... Duke Energy Registrants use commodity and interest rate contracts to manage commodity price risk and interest rate risk. The primary use of commodity derivatives is to hedge the generation portfolio against changes in the prices of electricity and natural gas. Interest rate swaps are used to manage...

  • Page 177
    ... to the impact of changes in the prices of electricity, coal and natural gas. Exposure to commodity price risk is inï¬,uenced by a number of factors including the term of contracts, the liquidity of markets and delivery locations. Regulated public utilities may have cost-based rate regulations and...

  • 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
    ... Total Derivative Assets - Interest Rate Contracts Total Derivative Assets $ 18 15 3 15 1 174 2 111 1 28 - 26 - 175 - 111 $ 14 14 Duke Energy Duke Energy Carolinas Progress Energy December 31, 2014 Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana $ 339 $ 341 $ 10...

  • Page 180
    ... 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 LIABILITIES The following tables present the line...

  • Page 181
    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) Derivative Assets (in ...

  • Page 182
    ... cash collateral or letters of credit in the event credit-risk-related contingent features were triggered Duke Energy $ 334 30 304 Duke Energy Carolinas $ 45 - 45 Progress Energy $ 290 30 260 Duke Energy Progress $ 93 - 93 Duke Energy Florida $ 194 30 164 Duke Energy Ohio $ - - - December 31, 2014...

  • Page 183
    ... generating assets and the NDTF assets acquired in a settlement with FMJO. This is partially offset due to reimbursements from the NDTF for Duke Energy Florida's costs related to ongoing decommissioning activity of the Crystal River Unit 3 Nuclear Plant. Refer to Note 2 for further information...

  • Page 184
    ... specific identification basis, from sales of available-for-sale securities were as follows. Years Ended December 31, (in millions) Realized gains Realized losses 2015 $193 98 2014 $271 105 2013 $ 209 65 DUKE ENERGY CAROLINAS The following table presents the estimated fair value of investments in...

  • Page 185
    ... generating assets and the NDTF assets acquired in a settlement with FMJO. This is partially offset due to reimbursements from the NDTF for Duke Energy Florida's costs related to ongoing decommissioning activity of the Crystal River Unit 3 Nuclear Plant. Refer to Note 2 for further information...

  • 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 FLORIDA, 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...

  • Page 188
    ..., 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. December 31, 2015...

  • Page 189
    ... for gas purchase contracts; and increases (decreases) in electricity forward prices result in unfavorable (favorable) fair value adjustments for electricity sales contracts. Duke Energy regularly evaluates and validates pricing inputs used to estimate the fair value of gas commodity contracts by...

  • Page 190
    ... basis on the Consolidated Balance Sheets. Derivative amounts in the table below exclude cash collateral which is disclosed in Note 14. See Note 15 for additional information related to investments by major security type. December 31, 2015 (in millions) Nuclear decommissioning trust fund equity...

  • Page 191
    ... ENERGY FLORIDA, LLC. • DUKE ENERGY OHIO, INC. • DUKE ENERGY INDIANA, INC. Combined Notes to Consolidated Financial Statements - (Continued) December 31, 2014 (in millions) Balance at beginning of period Total pretax realized or unrealized gains (losses) included in earnings Purchases, sales...

  • Page 192
    ... basis on the Consolidated Balance Sheets. Derivative amounts in the table below exclude cash collateral, which is disclosed in Note 14. See Note 15 for additional information related to investments by major security type. December 31, 2015 (in millions) Nuclear decommissioning trust fund equity...

  • Page 193
    ... basis on the Consolidated Balance Sheets. Derivative amounts in the table below exclude cash collateral which is disclosed in Note 14. See Note 15 for additional information related to investments by major security type. December 31, 2015 (in millions) Nuclear decommissioning trust fund equity...

  • Page 194
    ... basis on the Consolidated Balance Sheets. Derivative amounts in the table below exclude cash collateral, which is disclosed in Note 14. See Note 15 for additional information related to investments by major security type. December 31, 2015 (in millions) Other available-for-sale equity securities...

  • Page 195
    ...7.29 Fair Value (in millions) $ 10 Valuation Technique RTO auction pricing Unobservable Input FTR price - per megawatt-hour (MWh) Range $ (0.74) - $ 7.29 December 31, 2014 Investment Type Duke Energy Natural gas contracts FTRs Electricity contracts Commodity capacity option contracts Reserves Total...

  • Page 196
    ... 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) OTHER FAIR VALUE DISCLOSURES...

  • Page 197
    ... Accounts payable Taxes accrued Current maturities of long-term debt Other Long-Term Debt(b) Deferred Credits and Other Liabilities Deferred income taxes Asset retirement obligations Other Total liabilities Net assets of consolidated variable interest entities DERF Duke Energy Progress DEPR(c) Duke...

  • Page 198
    ...Florida Receivables, LLC (DEFR) are bankruptcy remote, special purpose subsidiaries of Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida, respectively. On a daily basis, DERF, DEPR and DEFR buy certain accounts receivable arising from the sale of electricity and/or related services...

  • Page 199
    ... March 2017 CRC On a revolving basis, Duke Energy Ohio and Duke Energy Indiana sell to CRC certain accounts receivable arising from the sale of electricity and related services. The receivables sold are securitized by CRC through a $325 million credit facility managed by two unrelated third parties...

  • Page 200
    ... a return on equity. Accordingly, the value of this contract is subject to variability due to ï¬,uctuations in power prices and changes in OVEC's costs of business, including costs associated with its 2,256 MW of coal-fired generation capacity. Proposed environmental rulemaking could increase the...

  • Page 201
    ...ows related to receivables sold. Duke Energy Ohio Years Ended December 31, (in millions) Sales Receivables sold Loss recognized on sale Cash Flows Cash proceeds from receivables sold Collection fees received Return received on retained interests 2015 $1,963 9 1,995 1 3 2014 $2,246 11 2,261 1 4 2013...

  • Page 202
    ...with the retirement of Crystal River Unit 3, severance benefits were made available to certain impacted unionized and nonunionized employees, to the extent that those employees did not find job opportunities at other locations. For the year ended December 31, 2013, Duke Energy Florida deferred $26...

  • Page 203
    ... 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 9 5 5 3 2013 $ 52 13 23 14 9 4 4 Weighted Average...

  • Page 204
    ....6 percent based on Duke Energy's historical volatility over three years using daily stock prices. The following table includes information related to stock-based performance awards. Years Ended December 31, 2015 Shares awarded (in thousands) Fair value (in millions) 642 $ 26 2014 542 $ 19 2013 633...

  • Page 205
    ...42 Duke Energy Progress $ 23 48 (79) 33 (2) 1 $ 24 Duke Energy Florida $ 20 54 (87) 31 (1) 1 $ 18 Duke Energy Ohio $ 4 18 (26) 7 - - $ 3 Duke Energy Indiana $ 10 27 (42) 13 1 1 $ 10 (in millions) Service cost Interest cost on projected benefit obligation Expected return on plan assets Amortization...

  • Page 206
    ... projected benefit obligation Expected return on plan assets Amortization of actuarial loss Amortization of prior service (credit) cost Other Net periodic pension costs(a)(b) (a) Duke Energy amounts exclude $9 million, $10 million, and $12 million for the years ended December 2015, 2014, and 2013...

  • Page 207
    ...456 $ (13) Duke Energy Indiana $ 632 9 29 41 - - (38) $ 673 $ 645 $ 654 65 (38) - $ 681 $ 8 (in millions) Change in Projected Benefit Obligation Obligation at prior measurement date Service cost Interest cost Actuarial loss(a) Transfers Plan amendments Benefits paid Obligation at measurement date...

  • Page 208
    ...31, 2015 and 2014, respectively, net of tax, associated with a Brazilian retirement plan. Information for Plans with Accumulated Benefit Obligation in Excess of Plan Assets December 31, 2015 Duke Energy $ 1,216 1,158 1,151 Progress Energy $ 611 575 574 Duke Energy Florida $ 611 575 574 Duke Energy...

  • Page 209
    ...Duke Energy Carolinas, Progress Energy, 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...

  • Page 210
    ... 31, 2014 Duke Energy $ 3 14 3 (1) $ 19 Duke Energy Carolinas $- 1 - - $ 1 Progress Energy $ 1 5 2 (1) $ 7 Duke Energy Progress $ 1 1 - - $ 2 Duke Energy Florida $- 2 - - $ 2 Duke Energy Ohio Duke Energy Indiana $- - - - $- (in millions) Service cost Interest cost on projected benefit obligation...

  • Page 211
    ... Energy Progress $ 35 - 1 - - (3) $ 33 $ 33 - (3) 3 $- Duke Energy Florida $ 61 - 2 (14) - (3) $ 46 $ 46 - (3) 3 $ - Duke Energy Ohio $ 4 4 $ 4 - - - $- Duke Energy Indiana $ 5 5 $ 5 - - - $- (in millions) Change in Projected Benefit Obligation Obligation at prior measurement date Service cost...

  • Page 212
    ...benefit costs on the Consolidated Balance Sheets. Information for Plans with Accumulated Benefit Obligation in Excess of Plan Assets December 31, 2015 Duke Energy $ 341 336 Duke Energy Carolinas $ 16 16 Progress Energy $ 112 112 Duke Energy Progress $ 33 33 Duke Energy Florida $ 46 46 Duke Energy...

  • Page 213
    ... years for Duke Energy Carolinas, Duke 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...

  • Page 214
    ...-retirement benefit obligation Expected return on plan assets Amortization of actuarial loss (gain) Amortization of prior service credit Net periodic post-retirement benefit costs(a)(b) (a) Duke Energy amounts exclude $10 million, $9 million, and $8 million for the years ended December 2015, 2014...

  • Page 215
    .... • 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 to Accrued Other Post-Retirement Benefit Costs Year Ended December 31, 2015 Duke...

  • Page 216
    ... 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 4.40% 4.10% 6.50% 35% 2014 4.10% 4.70% 6.75% 35% 2013...

  • Page 217
    ...75% 2023 2014 6.75% 4.75% 2023 Sensitivity to Changes in Assumed Health Care Cost Trend Rates Year Ended December 31, 2015 Duke Energy $ 2 29 (1) (26) Duke Energy Carolinas $- 7 - (6) Progress Energy $ 1 12 (1) (11) Duke Energy Progress $ 1 6 (1) (6) Duke Energy Florida $ - 6 - (5) Duke Energy Ohio...

  • Page 218
    ... enhancing the security of benefits for plan participants. As of December 31, 2015, Duke Energy assumes pension and other post-retirement plan assets will generate a long-term rate of return of 6.50 percent. The expected long-term rate of return was developed using a weighted average calculation of...

  • Page 219
    ... unpublished prices are valued as Level 2. Duke Energy Master Retirement Trust The following tables provide the 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...

  • Page 220
    ... 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) Equity securities Corporate...

  • Page 221
    ... Progress $34 30 25 Duke Energy Florida $13 14 14 Duke Energy Ohio $3 3 3 Duke Energy Indiana $7 7 7 (in millions) Years ended December 31, 2015(a) 2014(a) 2013 (a) For 2014 and 2015, amounts include the additional employer contribution of 4 percent of eligible pay per pay period for employees...

  • 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
    ... operations Effective tax rate Year Ended December 31, 2014 Duke Energy $ 1,447 59 (110) (47) (67) 373 14 $ 1,669 40.4% Duke Energy Carolinas $ 581 17 - (32) - - 22 $ 588 35.4% Progress Energy $ 497 49 - (9) - - 3 $ 540 38.0% Duke Energy Progress $ 263 25 - (9) - - 6 $ 285 37.9% Duke Energy Florida...

  • Page 224
    ...407) Duke Energy Indiana $ 5 2 40 - 215 - 20 - 282 (7) (1,797) (135) (1,939) $(1,657) (in millions) Deferred credits and other liabilities Capital lease obligations Pension, post-retirement and other employee benefits Progress Energy merger purchase accounting adjustments(a) Tax credits and NOL...

  • Page 225
    ... lease 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...

  • Page 226
    ... following tables present changes to unrecognized tax benefits. Year Ended December 31, 2015 Duke Energy $ 213 - (48) (45) (32) (125) $ 88 $ Duke Energy Carolinas $ 160 - (45) (43) - (88) 72 $ Progress Energy $ 32 1 - - (32) (31) 1 Duke Energy Progress $ 23 1 - - (21) (20) $ 3 Duke Energy Florida...

  • Page 227
    ... tax rate versus the regulatory liability. OTHER TAX MATTERS The following tables include interest recognized in the Consolidated Statements of Operations and the Consolidated Balance Sheets. Year Ended December 31, 2015 Duke Energy $ 12 - 3 - Duke Energy Carolinas $ - 1 - 14 Progress Energy...

  • Page 228
    ... in-service equity returns Nonoperating income (expense), other Other income and expense, net Year Ended December 31, 2014 Duke Energy $ 57 3 135 89 67 $ 351 Duke Energy Carolinas $ 4 - 91 71 6 $ 172 $ Progress Energy $ 3 - 26 17 31 77 $ Duke Energy Progress $ - - 25 17 9 51 $ Duke Energy Florida...

  • Page 229
    ...Basin Settlement and Penalties (see Note 5) State Tax Adjustment related to Midwest Generation Sale Cost Savings Initiatives (see Note 19) Total 2014 Costs to Achieve, Mergers Midwest Generation Impairment Coal Ash Plea Agreements Reserve (see Note 5) International Tax Adjustment (see Note 22) Asset...

  • Page 230
    ...) Total 2014 Costs to Achieve, Mergers Coal Ash Plea Agreements Reserve (see Note 5) Total First Second Third Quarter Quarter Quarter $ (8) $ (8 8) (6) - $ (14) $ (21) - $ (21) Fourth Quarter Total DUKE ENERGY FLORIDA (in millions) 2015 Operating revenues Operating income Net income 2014 Operating...

  • Page 231
    ... 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 Operating...

  • Page 232
    ... 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 Officer, as appropriate, to...

  • Page 233
    ... tables present the Deloitte fees for services rendered to the Duke Energy Registrants during 2015 and 2014. Year Ended December 31, 2015 Duke Energy $ 12.5 2.7 0.2 $ 15.4 Duke Energy Carolinas $4.6 - 0.1 $4.7 Progress Energy $5.1 - - $5.1 Duke Energy Progress $2.9 - - $2.9 Duke Energy Florida...

  • Page 234
    ...because the required information is included in the Consolidated Financial Statements or Notes. Duke Energy Carolinas, LLC Consolidated Financial Statements Consolidated Statements of Operations and Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013 Consolidated Balance Sheets...

  • Page 235
    ... Duke Energy Indiana, LLC) Consolidated Financial Statements Consolidated Statements of Operations and Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013 Consolidated Balance Sheets as of December 31, 2015 and 2014 Consolidated Statements of Cash Flows for the Years...

  • Page 236
    ... duly authorized. Date: February 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...

  • Page 237
    ..., thereunto duly authorized. Date: 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...

  • Page 238
    ... undersigned, thereunto duly authorized. 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...

  • Page 239
    ..., thereunto duly authorized. 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...

  • Page 240
    ..., thereunto duly authorized. 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...

  • Page 241
    ...undersigned, thereunto duly authorized. 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...

  • Page 242
    ..., thereunto duly authorized. 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...

  • Page 243
    ... is required to be filed as an exhibit to this report pursuant to 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...

  • Page 244
    ...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 & Electric Company...

  • 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.)) Current Report on Form 8-K filed on November 20, 2012, File No. 1-3274). Indenture (for Debt Securities) between Duke Energy Florida, Inc. (formerly Florida Power Corporation (d/b/a Progress Energy Florida, Inc.)) and The Bank of New...

  • Page 250
    ... Duke Energy Carolinas Duke 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...

  • Page 251
    PART IV Duke Energy Carolinas Duke Energy Progress Duke Energy Florida Duke Energy Ohio Duke Energy Indiana X X Exhibit Number 4.14.5 4.14.6 ...of July 15, 1991, (filed as an exhibit to registrant's Annual Report on Form 10-K for the year ended December 31, 1991, File No. 1-3543). Forty-eighth ...

  • Page 252
    ...led on July 11, 2013, File No. 1-3543). Repayment Agreement between Duke Energy Ohio, Inc. (formerly The Cincinnati Gas & Electric Company) and The Dayton Power and Light Company, dated as of December 23, 1992, (filed with registrant's Annual Report on Form 10-K for the year ended December 31, 1992...

  • Page 253
    ...to Exhibit 10.15 to Duke Energy Corporation's Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, filed on August 9, 2006, File No. 1-32853). Asset Purchase Agreement between Saluda River Electric Cooperative, Inc., as Seller, and Duke Energy Carolinas, LLC, as Purchaser, dated as of...

  • Page 254
    ...3543). Asset Purchase Agreement between Duke Energy Indiana, Inc. (formerly PSI Energy, Inc.) and Duke Energy Ohio, Inc. (formerly The Cincinnati Gas & Electric Company) and Allegheny Energy Supply Company, LLC, Allegheny Energy Supply Wheatland Generating Facility, LLC and Lake Acquisition Company...

  • Page 255
    ... to Rule 24b-2 under the Securities Exchange Act of 1934, as amended). Agreement and Plan of Merger between DEGS Wind I, LLC, DEGS Wind Vermont, Inc., Catamount Energy Corporation, dated as of June 25, 2008, (incorporated by reference to Exhibit 10.2 to Duke Energy Corporation's Quarterly Report on...

  • Page 256
    ...Duke Energy Progress Duke Energy Florida Duke Energy Ohio X Duke 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...

  • Page 257
    ...). Operating and Fuel Agreement, dated as of July 30, 1981, between Duke Energy Progress, Inc. (formerly Carolina Power & Light Company) and North Carolina Municipal Power Agency Number 3 and Exhibits, together with resolution, dated as of December 16, 1981, changing name to North Carolina Eastern...

  • Page 258
    ...), effective September 15, 2011. Precedent and Related Agreements between Duke Energy Florida, Inc. (formerly Florida Power Corporation d/b/a Progress Energy Florida, Inc. ("PEF")), Southern Natural Gas Company, Florida Gas Transmission Company ("FGT"), and BG LNG Services, LLC ("BG"), including...

  • Page 259
    ...by reference to Exhibit 10.61 to Duke Energy Corporation's Annual Report on Form 10-K for the year ended December 31, 2014, filed on March 2, 2015, File No. 1-32853). Asset Purchase Agreement between Duke Energy Progress, Inc. and North Carolina Eastern Municipal Power Agency, dated as of September...

  • Page 260
    .... Consent 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...

  • 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