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What changed in Duke Energy CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Duke Energy CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+531 added−540 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-23)

Top changes in Duke Energy CORP's 2024 10-K

531 paragraphs added · 540 removed · 399 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

106 edited+23 added−29 removed86 unchanged
Biggest changeRegulatory Body Annual Increase (Decrease) (in millions) Return on Equity Equity Component of Capital Structure Effective Date Approved Rate Cases: Duke Energy Carolinas 2023 North Carolina Rate Case (a) NCUC $ 768 10.1 % 53 % January 2024 Duke Energy Kentucky 2022 Kentucky Electric Rate Case (b) KPSC 48 9.75 % 52.145 % October 2023 Duke Energy Progress 2022 North Carolina Rate Case (c) NCUC 494 9.8 % 53 % October 2023 Duke Energy Progress 2022 South Carolina Rate Case PSCSC 52 9.6 % 52.43 % April 2023 Duke Energy Ohio 2021 Ohio Electric Rate Case PUCO 23 9.5 % 50.5 % January 2023 Duke Energy Progress 2019 North Carolina Rate Case NCUC 178 9.6 % 52 % June 2021 Duke Energy Carolinas 2019 North Carolina Rate Case NCUC 33 9.6 % 52 % June 2021 Pending Rate Cases: Duke Energy Carolinas 2024 South Carolina Rate Case PSCSC 239 10.5 % 53 % August 2024 (a) Of the total rate case increase, Year 1, 2 and 3 rates are approximately 57%, 22% and 21%, respectively.
Biggest changeRegulatory Body Revenue Increase (Decrease) (in millions) Return on Equity Equity Component of Capital Structure Effective Date Approved Rate Cases: Duke Energy Indiana 2024 Rate Case IURC $ 385 9.75 % 53 % March 2025 Duke Energy Florida 2024 Rate Case (a) FPSC 203 10.3 % 53 % January 2025 Duke Energy Carolinas 2024 South Carolina Rate Case PSCSC 150 9.94 % 51.21 % August 2024 Duke Energy Carolinas 2023 North Carolina Rate Case (b) NCUC 768 10.1 % 53 % January 2024 Duke Energy Kentucky 2022 Kentucky Electric Rate Case (c) KPSC 48 9.75 % 52.145 % October 2023 Duke Energy Progress 2022 North Carolina Rate Case (d) NCUC 494 9.8 % 53 % October 2023 Duke Energy Progress 2022 South Carolina Rate Case PSCSC 36 9.6 % 52.43 % April 2023 Duke Energy Ohio 2021 Ohio Electric Rate Case PUCO 23 9.5 % 50.5 % January 2023 Duke Energy Florida 2021 Settlement agreement (e) FPSC 195 9.85 % 53 % January 2022 Pending Rate Cases: Duke Energy Kentucky 2024 Kentucky Electric Rate Case KPSC 70 10.85 % 52.728 % July 2025 (a) In Year 2, rates will increase by $59 million.
The current average sulfur content of coal purchased by EU&I is between 0.5% and 3.5% for Duke Energy Carolinas and Duke Energy Progress, between 1% and 3.5% for Duke Energy Florida, and between 0.5% and 4.0% for Duke Energy Ohio and Duke Energy Indiana.
The current average sulfur content of coal purchased by EU&I is between 0.5% and 3.5% for Duke Energy Carolinas and Duke Energy Progress, between 1.0% and 3.5% for Duke Energy Florida, between 1.5% and 4.0% for Duke Energy Ohio and between 1.0% and 4.0% for Duke Energy Indiana.
Therefore, the license no longer authorizes operation of the reactor. For additional information on nuclear decommissioning activity, see Note 10 to the Consolidated Financial Statements, "Asset Retirement Obligations." Regulation State The state electric utility commissions approve rates for Duke Energy's retail electric service within their respective states.
Therefore, the license no longer authorizes operation of the reactor. For additional information on nuclear decommissioning activity, see Note 10 to the Consolidated Financial Statements, "Asset Retirement Obligations." Regulation State The state utility commissions approve rates for Duke Energy's retail electric service within their respective states.
The state electric utility commissions, to varying degrees, have authority over the construction and operation of EU&I’s generating facilities. CPCNs issued by the state electric utility commissions, as applicable, authorize EU&I to construct and operate its electric facilities and to sell electricity to retail and wholesale customers.
The state utility commissions, to varying degrees, have authority over the construction and operation of EU&I’s generating facilities. CPCNs issued by the state utility commissions, as applicable, authorize EU&I to construct and operate its electric facilities and to sell electricity to retail and wholesale customers.
The state gas utility commissions, to varying degrees, have authority over the construction and operation of GU&I’s natural gas distribution facilities. CPCNs issued by the state gas utility commissions or other government agencies, as applicable, authorize GU&I to construct and operate its natural gas distribution facilities and to sell natural gas to retail and wholesale customers.
The state utility commissions, to varying degrees, have authority over the construction and operation of GU&I’s natural gas distribution facilities. CPCNs issued by the state utility commissions or other government agencies, as applicable, authorize GU&I to construct and operate its natural gas distribution facilities and to sell natural gas to retail and wholesale customers.
In addition to amounts collected from customers through approved base rates, each of the state gas utility commissions allow recovery of certain costs through various cost recovery clauses to the extent the respective commission determines in periodic hearings that such costs, including any past over- or under-recovered costs, are prudent. Natural gas costs are eligible for recovery by GU&I.
In addition to amounts collected from customers through approved base rates, each of the state utility commissions allow recovery of certain costs through various cost recovery clauses to the extent the respective commission determines in periodic hearings that such costs, including any past over- or under-recovered costs, are prudent. Natural gas costs are eligible for recovery by GU&I.
Regulations of the FERC and the state gas utility commissions govern access to regulated natural gas and other data by nonregulated entities and services provided between regulated and nonregulated energy affiliates. These regulations affect the activities of nonregulated affiliates with GU&I. Environmental GU&I is subject to the jurisdiction of the EPA and state and local environmental agencies.
Regulations of the FERC and the state utility commissions govern access to regulated natural gas and other data by nonregulated entities and services provided between regulated and nonregulated energy affiliates. These regulations affect the activities of nonregulated affiliates with GU&I. Environmental GU&I is subject to the jurisdiction of the EPA and state and local environmental agencies.
Prior approval from the relevant state gas utility commission is required for GU&I to issue securities. The underlying concept of utility ratemaking is to set rates at a level that allows the utility to collect revenues equal to its cost of providing service plus a reasonable rate of return on its invested capital, including equity.
Prior approval from the relevant state utility commission is required for GU&I to issue securities. The underlying concept of utility ratemaking is to set rates at a level that allows the utility to collect revenues equal to its cost of providing service plus a reasonable rate of return on its invested capital, including equity.
In addition to competitive base pay, we provide eligible employees with compensation and benefits under a variety of plans and programs, including health care benefits, retirement savings, pension, health savings and flexible spending accounts, wellness, family leaves, employee assistance, as well as other benefits including a charitable matching program.
In addition to competitive base pay, we provide eligible employees with compensation and benefits under a variety of plans and programs, including health care benefits, retirement savings, pension, health savings and flexible spending accounts, wellness, family leaves, employee assistance, as well as other benefits including a charitable matching donation program.
Owners and/or operators of air emission sources are responsible for obtaining permits and for annual compliance and reporting. • The Clean Water Act, which requires permits for facilities that discharge wastewaters into navigable waters. • The Comprehensive Environmental Response, Compensation and Liability Act, which can require any individual or entity that currently owns or in the past owned or operated a disposal site, as well as transporters or generators of hazardous substances sent to a disposal site, to share in remediation costs. • The National Environmental Policy Act, which requires federal agencies to consider potential environmental impacts in their permitting and licensing decisions, including siting approvals. • The CCR Rule, a 2015 EPA rule establishing national regulations to provide a comprehensive set of requirements for the management and disposal of CCR from coal-fired power plants. • Coal Ash Act, as amended, which establishes requirements regarding the use and closure of existing ash basins, the disposal of ash at active coal plants and the handling of surface water and groundwater impacts from ash basins in North Carolina. • The Solid Waste Disposal Act, as amended by RCRA, which creates a framework for the proper management of hazardous and nonhazardous solid waste; classifies CCR as nonhazardous waste; and establishes standards for landfill and surface impoundment placement, design, operation and closure, groundwater monitoring, corrective action, and post-closure care. • The Toxic Substances Control Act, which gives EPA the authority to require reporting, recordkeeping and testing requirements, and to place restrictions relating to chemical substances and/or mixtures, including polychlorinated biphenyls.
Owners and/or operators of air emission sources are responsible for obtaining permits and for annual compliance and reporting. • The Clean Water Act, which requires permits for facilities that discharge wastewaters into navigable waters. • The Comprehensive Environmental Response, Compensation and Liability Act, which can require any individual or entity that currently owns or in the past owned or operated a disposal site, as well as transporters or generators of hazardous substances sent to a disposal site, to share in remediation costs. • The National Environmental Policy Act, which requires federal agencies to consider potential environmental impacts in their permitting and licensing decisions, including siting approvals. • The 2015 and 2024 CCR Rules, EP A rules establishing national regulations to provide a comprehensive set of requirements for the management and disposal of CCR from coal-fired power plants. • The Coal Ash Act, as amended, which establishes requirements regarding the use and closure of existing ash basins, the disposal of ash at active coal plants and the handling of surface water and groundwater impacts from ash basins in North Carolina. • The Solid Waste Disposal Act, as amended by RCRA, which creates a framework for the proper management of hazardous and nonhazardous solid waste; classifies CCR as nonhazardous waste; and establishes standards for landfill and surface impoundment placement, design, operation and closure, groundwater monitoring, corrective action and post-closure care. • The Toxic Substances Control Act, which gives EPA the authority to require reporting, recordkeeping and testing requirements, and to place restrictions relating to chemical substances and/or mixtures, including polychlorinated biphenyls.
Key areas of focus include fostering a high-performance and inclusive culture built on strong leadership and highly engaged and diverse employees, building a pipeline of skilled workers and ensuring knowledge transfer as employees retire.
Key areas of focus include fostering a high-performance and inclusive culture built on strong leadership and highly engaged employees, building a pipeline of skilled workers and ensuring knowledge transfer as employees retire.
Compensation The Company seeks to attract and retain an appropriately qualified workforce and leverages Duke Energy’s leadership imperatives to foster a culture focused on customers, innovation, and highly engaged employees.
The Company seeks to attract and retain an appropriately qualified workforce and leverages Duke Energy’s leadership imperatives to foster a culture focused on customers, innovation, and highly engaged employees.
Our Human Resources organization is responsible for our human capital management strategy, which includes recruiting and hiring, onboarding and training, diversity and inclusion, workforce planning, talent and succession planning, performance management and employee development.
Our Human Resources organization is responsible for our human capital management strategy, which includes recruiting and hiring, onboarding and training, inclusion, workforce planning, talent and succession planning, performance management and employee development.
See Notes 4, 13 and 18 to the Consolidated Financial Statements, "Regulatory Matters," "Investments in Unconsolidated Affiliates" and "Variable Interest Entities," respectively, for further information on Duke Energy's and GU&I's natural gas investments. 17 BUSINESS Inventory GU&I must maintain adequate natural gas inventory in order to provide reliable delivery to customers.
See Notes 4, 13 and 18 to the Consolidated Financial Statements, "Regulatory Matters," "Investments in Unconsolidated Affiliates" and "Variable Interest Entities," respectively, for further information on Duke Energy's and GU&I's natural gas investments. Inventory GU&I must maintain adequate natural gas inventory in order to provide reliable delivery to customers.
ELECTRIC UTILITIES AND INFRASTRUCTURE EU&I conducts operations primarily through the regulated public utilities of Duke Energy Carolinas, Duke Energy Progress, Duke Energy Florida, Duke Energy Indiana and Duke Energy Ohio. EU&I provides retail electric service through the generation, transmission, distribution and sale of electricity to approximately 8.4 million customers within the Southeast and Midwest regions of the U.S.
ELECTRIC UTILITIES AND INFRASTRUCTURE EU&I conducts operations primarily through the regulated public utilities of Duke Energy Carolinas, Duke Energy Progress, Duke Energy Florida, Duke Energy Indiana and Duke Energy Ohio. EU&I provides retail electric service through the generation, transmission, distribution and sale of electricity to approximately 8.6 million customers within the Southeast and Midwest regions of the U.S.
The NCUC and the PSCSC require Duke Energy Carolinas and Duke Energy Progress update cost estimates for decommissioning their nuclear plants every five years.
The NCUC and the PSCSC require Duke Energy Carolinas and Duke Energy Progress to update cost estimates for decommissioning their nuclear plants every five years.
Impact of Weather GU&I revenues are generally protected from the impact of weather fluctuations due to the regulatory mechanisms that are available in most service territories. In North Carolina, margin decoupling provides protection from both weather and other usage variations like conservation for residential and small and medium general service customers.
Impact of Weather GU&I revenues are generally protected from the impact of weather fluctuations due to the regulatory mechanisms that are available in most service territories. In North Carolina, margin decoupling provides protection from both weather and other usage variations like conservation for residential and small and medium commercial customers.
EU&I's environmental controls, in combination with the use of sulfur dioxide (SO 2 ) emission allowances, enable EU&I to satisfy current SO 2 emission limitations for its existing facilities. Purchased Power EU&I purchases a portion of its capacity and system requirements through purchase obligations, leases and purchase capacity contracts.
EU&I's environmental controls, in combination with the use of sulfur dioxide (SO 2 ) emission allowances, enable EU&I to satisfy current SO 2 emission limitations for its existing facilities. Purchased Power EU&I acquires a portion of its capacity and system requirements through purchase obligations, leases and purchase capacity contracts.
For additional information, see Note 10 to the Consolidated Financial Statements, “Asset Retirement Obligations.” The Nuclear Waste Policy Act of 1982 (as amended) provides the framework for development by the federal government of interim storage and permanent disposal facilities for high-level radioactive waste materials.
For additional information, see Note 10 to the Consolidated Financial Statements, “Asset Retirement Obligations.” 13 BUSINESS The Nuclear Waste Policy Act of 1982 (as amended) provides the framework for development by the federal government of interim storage and permanent disposal facilities for high-level radioactive waste materials.
However, delays between the expenditure for fuel costs and recovery from customers can adversely impact the timing of cash flows of EU&I. The table below reflects significant electric rate case applications approved and effective in the past three years and applications currently pending approval.
However, delays between the expenditure for fuel costs and recovery from customers can adversely impact the timing of cash flows of EU&I. 14 BUSINESS The table below reflects significant electric rate case applications approved and effective in the past three years and applications currently pending approval.
Duke Energy Ohio is subject to the regulatory provisions of the PUCO, KPSC, PHMSA and FERC. Duke Energy Ohio’s service area covers approximately 3,000 square miles and supplies electric service to approximately 910,000 residential, commercial and industrial customers and provides transmission and distribution services for natural gas to approximately 560,000 customers.
Duke Energy Ohio is subject to the regulatory provisions of the PUCO, KPSC, PHMSA and FERC. Duke Energy Ohio’s service area covers approximately 3,000 square miles and supplies electric service to approximately 920,000 residential, commercial and industrial customers and provides transmission and distribution services for natural gas to approximately 560,000 customers.
Duke Energy Indiana’s service area covers approximately 23,000 square miles and supplies electric service to approximately 900,000 residential, commercial and industrial customers. For information about Duke Energy Indiana's generating facilities, see Item 2, “Properties.” Duke Energy Indiana is subject to the regulatory provisions of the IURC and FERC.
Duke Energy Indiana’s service area covers approximately 23,000 square miles and supplies electric service to approximately 920,000 residential, commercial and industrial customers. For information about Duke Energy Indiana's generating facilities, see Item 2, “Properties.” Duke Energy Indiana is subject to the regulatory provisions of the IURC and FERC.
The following map shows the service territory for EU&I as of December 31, 2023. 9 BUSINESS The electric operations and investments in projects are subject to the rules and regulations of the FERC, the NRC, the NCUC, the PSCSC, the FPSC, the IURC, the PUCO and the KPSC.
The following map shows the service territory for EU&I as of December 31, 2024. 9 BUSINESS The electric operations and investments in projects are subject to the rules and regulations of the FERC, the NRC, the NCUC, the PSCSC, the FPSC, the IURC, the PUCO and the KPSC.
GU&I also has investments in various pipeline transmission projects, renewable natural gas projects and natural gas storage facilities. 16 BUSINESS Natural Gas for Retail Distribution GU&I is responsible for the distribution of natural gas to retail customers in its North Carolina, South Carolina, Tennessee, Ohio and Kentucky service territories.
GU&I also has investments in various pipeline transmission projects, renewable natural gas projects and natural gas storage facilities. Natural Gas for Retail Distribution GU&I is responsible for the distribution of natural gas to retail customers in its North Carolina, South Carolina, Tennessee, Ohio and Kentucky service territories.
(b) For 2023, 2022 and 2021, these agreements include approximately 412 MW of firm capacity under contract by Duke Energy Florida with QFs. 12 BUSINESS Inventory EU&I must maintain an adequate stock of fuel and materials and supplies in order to ensure continuous operation of generating facilities and reliable delivery to customers.
(b) These agreements include approximately 182 MW of firm capacity for 2024, and 412 MW of firm capacity for 2023 and 2022 under contract by Duke Energy Florida with QFs. 12 BUSINESS Inventory EU&I must maintain an adequate stock of fuel and materials and supplies in order to ensure continuous operation of generating facilities and reliable delivery to customers.
EU&I has entered into fuel contracts that cover 100% of its uranium concentrates through at least 2027, 100% of its conversion services through at least 2029, 100% of its enrichment services through at least 2027, and 100% of its fabrication services requirements for these plants through at least 2027.
EU&I has entered into fuel contracts that cover 100% of its uranium concentrates through at least 2029, 100% of its conversion services through at least 2034, 100% of its enrichment services through at least 2033, and 100% of its fabrication services requirements for these plants through at least 2027.
For additional information regarding this business segment, including financial information, see Note 3 to the Consolidated Financial Statements, “Business Segments.” 22 PART I 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.
For additional information regarding this business segment, including financial 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.
Decommissioning costs are stated in 2023 or 2019 dollars, depending on the year of the cost study, and include costs to decommission plant components not subject to radioactive contamination.
Decommissioning costs are stated in 2023 or 2024 dollars, depending on the year of the cost study, and include costs to decommission plant components not subject to radioactive contamination.
GU&I's primary product competition is with electricity for space heating, water heating and cooking. Increases in the price of natural gas or decreases in the price of other energy sources could negatively impact competitive position by decreasing the price benefits of natural gas to the consumer.
A significant competitive factor is price. GU&I's primary product competition is with electricity for space heating, water heating and cooking. Increases in the price of natural gas or decreases in the price of other energy sources could negatively impact competitive position by decreasing the price benefits of natural gas to the consumer.
This could result in slow or no customer growth and could cause customers to reduce or cease using our product, thereby reducing our ability to make capital expenditures and otherwise grow our business, adversely affecting our earnings. Natural Gas Investments Duke Energy, through its GU&I segment, has a 7.5% equity ownership interest in Sabal Trail.
This could result in slow or no customer growth for GU&I and could cause customers to reduce or cease using natural gas, thereby reducing GU&I's ability to make capital expenditures and otherwise grow its business, adversely affecting its earnings. Natural Gas Investments Duke Energy, through its GU&I segment, has a 7.5% equity ownership interest in Sabal Trail.
Competition between natural gas and other forms of energy is also based on efficiency, performance, reliability, safety and other non-price factors. Technological improvements in other energy sources and events that impair the public perception of the non-price attributes of natural gas could erode our competitive advantage.
Competition between natural gas and other forms of energy is also based on efficiency, performance, reliability, safety and other non-price factors. Technological improvements in other energy sources and events that impair the public perception of the non-price attributes of natural gas could erode GU&I's competitive advantage.
The EPA CCR rule and the Coal Ash Act leave the decision on cost recovery determinations related to closure of coal ash surface impoundments to the normal ratemaking processes before utility regulatory commissions. Duke Energy's electric utilities have included compliance costs associated with federal and state requirements in their respective rate proceedings.
The 2015 and 2024 EPA CCR Rules and the Coal Ash Act leave the decision on cost recovery determinations related to closure of coal ash surface impoundments to the normal ratemaking processes before utility regulatory commissions. Duke Energy's electric utilities have included compliance costs associated with federal and state requirements in their respective rate proceedings.
In 2023, firm supply purchase commitment agreements provided for approximately 96% of the natural gas supply for both Piedmont and Duke Energy Ohio during the winter months and 100% of forecasted demand was under contract prior to the winter heating season.
In 2024, firm supply purchase commitment agreements provided for approximately 100% of the natural gas supply for both Piedmont and Duke Energy Ohio during the winter months and 100% of forecasted demand was under contract prior to the winter heating season.
These factors in turn could decrease the demand for natural gas, impair our ability to attract new customers and cause existing customers to switch to other forms of energy or to bypass our systems in favor of alternative competitive sources.
These factors in turn could decrease the demand for natural gas, impair GU&I's ability to attract new customers and cause existing customers to switch to other forms of energy or to bypass GU&I's systems in favor of alternative competitive sources.
As of December 31, 2023, the inventory balance for GU&I was $129 million. For more information on inventory, see Note 1 to the Consolidated Financial Statements, "Summary of Significant Accounting Policies." Regulation State The state gas utility commissions approve rates for Duke Energy's retail natural gas service within their respective states.
As of December 31, 2024, the inventory balance for GU&I was $95 million. For more information on inventory, see Note 1 to the Consolidated Financial Statements, "Summary of Significant Accounting Policies." Regulation State The state utility commissions approve rates for Duke Energy's retail natural gas service within their respective states.
Duke Energy Progress’ service area covers approximately 28,000 square miles and supplies electric service to approximately 1.7 million residential, commercial and industrial customers. For information about Duke Energy Progress’ generating facilities, see Item 2, “Properties.” Duke Energy Progress is subject to the regulatory provisions of the NCUC, PSCSC, NRC and FERC.
Duke Energy Progress’ service area covers approximately 28,000 square miles and supplies electric service to approximately 1.8 million residential, commercial and industrial customers. 21 BUSINESS For information about Duke Energy Progress’ generating facilities, see Item 2, “Properties.” Duke Energy Progress is subject to the regulatory provisions of the NCUC, PSCSC, NRC and FERC.
The following table represents the distribution of GWh billed sales by customer class for the year ended December 31, 2023.
The following table represents the distribution of GWh billed sales by customer class for the year ended December 31, 2024.
Wholesale energy sales will be impacted by the extent to which additional generation is available to sell to the wholesale market and the ability of EU&I to attract new customers and to retain existing customers. Energy Capacity and Resources EU&I owns approximately 54,772 MW of generation capacity.
Wholesale energy sales will be impacted by the extent to which additional generation is available to sell to the wholesale market and the ability of EU&I to attract new customers and to retain existing customers. Energy Capacity and Resources EU&I owns approximately 55,139 MW of generation capacity.
The following table lists sources of electricity and fuel costs for the three years ended December 31, 2023.
The following table lists sources of electricity and fuel costs for the three years ended December 31, 2024.
The Company is committed to providing market competitive, fair, and equitable compensation and regularly conducts internal pay equity reviews, and benchmarking against peer companies to ensure our pay is competitive. 19 BUSINESS Diversity and Inclusion Duke Energy is committed to continuing to build a diverse workforce that reflects the communities we serve while strengthening a culture of inclusion where all employees and customers feel respected and valued.
The Company is committed to providing market competitive and fair compensation and regularly conducts internal pay reviews, and benchmarking against peer companies to ensure our pay is competitive. Duke Energy is committed to continuing to build a workforce that reflects the communities we serve while strengthening a culture of inclusion where all employees and customers feel respected and valued.
As of December 31, 2023, the inventory balance for EU&I was approximately $4.1 billion. For additional information on inventory, see Note 1 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies.” Ash Basin Management The EPA has issued regulations related to the management of CCR from power plants including the CCR Rule.
As of December 31, 2024, the inventory balance for EU&I was approximately $4.4 billion. For additional information on inventory, see Note 1 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies.” Ash Basin Management The EPA has issued regulations related to the management of CCR from power plants, including the 2015 and 2024 CCR Rules.
The following table includes the current year of expiration of nuclear operating licenses for nuclear stations in operation. In June 2021, Duke Energy Carolinas filed a subsequent license renewal application for Oconee with the U.S. Nuclear Regulatory Commission to renew Oconee's operating license for an additional 20 years.
The following table includes the current year of expiration of nuclear operating licenses for nuclear stations in operation. In June 2021, Duke Energy Carolinas filed a subsequent license renewal application for Oconee with the NRC to renew Oconee's operating license for an additional 20 years.
Prior to that, he served as Senior Vice President and Chief Distribution Officer from June 2018 to October 2019; State President, Florida from January 2017 to June 2018; Senior Vice President of Environmental Health and Safety from August 2014 to January 2017; and Vice President of Power Generations for the Company's Fossil/Hydro Operations in the western portions of North Carolina and South Carolina from July 2012 to August 2014.
Prior to that, he served as Executive Vice President, Customer Experience, Solutions and Services from October 2019 to April 2024; Senior Vice President and Chief Distribution Officer from June 2018 to October 2019; State President, Florida from January 2017 to June 2018; Senior Vice President of Environmental Health and Safety from August 2014 to January 2017; and Vice President of Power Generations for the Company's Fossil/Hydro Operations in the western portions of North Carolina and South Carolina from July 2012 to August 2014.
Expiration dates for its long-term contracts, which may have various price adjustment provisions and market reopeners, range from 2024 to 2027 for Duke Energy Carolinas, Duke Energy Progress and Duke Energy Indiana, 2024 to 2026 for Duke Energy Florida and 2024 to 2025 for Duke Energy Ohio.
Expiration dates for its long-term contracts, which may have various price adjustment provisions and market reopeners, range from 2025 to 2029 for Duke Energy Carolinas and Duke Energy Progress, 2025 to 2028 for Duke Energy Florida, 2025 to 2027 for Duke Energy Ohio and 2025 to 2030 for Duke Energy Indiana.
As such, the safety of our workforce remains our top priority. The Company closely monitors the total incident case rate (TICR), which is a metric based on strict OSHA definitions that measures the number of occupational injuries and illnesses per 100 employees. This objective emphasizes our focus on achieving an event-free and injury-free workplace.
The Company closely monitors the total incident case rate (TICR), which is a metric based on strict OSHA definitions that measures the number of occupational injuries and illnesses per 100 employees. This objective emphasizes our focus on achieving an event-free and injury-free workplace.
For additional information on these business segments, including financial information, see Note 3 to the Consolidated Financial Statements, “Business Segments.” DUKE ENERGY INDIANA Duke Energy Indiana is a regulated public utility primarily engaged in the generation, transmission, distribution and sale of electricity in portions of Indiana.
Duke Energy Ohio has two reportable segments, EU&I and GU&I. For additional information on these business segments, including financial information, see Note 3 to the Consolidated Financial Statements, “Business Segments.” DUKE ENERGY INDIANA Duke Energy Indiana is a regulated public utility primarily engaged in the generation, transmission, distribution and sale of electricity in portions of Indiana.
During 2017, Duke Energy Carolinas' and Duke Energy Progress’ wholesale contracts were amended to include the recovery of expenditures related to AROs for the closure of coal ash basins. The amended contracts have retail disallowance parity or provisions limiting challenges to CCR cost recovery actions at FERC. FERC approved the amended wholesale rate schedules in 2017.
Additionally, Duke Energy Carolinas' and Duke Energy Progress’ wholesale contracts were amended to include the recovery of expenditures related to AROs for the closure of coal ash basins. The amended contracts have retail disallowance parity or provisions limiting challenges to CCR cost recovery actions at FERC.
Prior to that, he served as Senior Vice President, External Affairs and Communications from May 2021 to March 2023; Senior Vice President of Federal Government and Corporate Affairs from 2019 to May 2021; and Vice President, Federal Government Affairs and Strategic Policy from March 2017 to 2019. Prior to joining Duke Energy, Mr.
Prior to that, he served as Senior Vice President, External Affairs and Communications from May 2021 to March 2023; Senior Vice President of Federal Government and Corporate Affairs from October 2019 to May 2021; and Vice President, Federal Government Affairs and Strategic Policy from March 2017 to October 2019 since joining the Company in 2017. Before joining Duke Energy, Mr.
Cost of Delivered Fuel per Net Generation by Source Kilowatt-hour Generated (Cents) 2023 2022 2021 2023 2022 2021 Natural gas and fuel oil (a) 33.3 % 34.2 % 31.8 % 3.81 6.35 3.89 Nuclear (a) 28.4 % 26.6 % 29.8 % 0.58 0.58 0.58 Coal (a) 12.8 % 13.5 % 18.2 % 4.07 3.43 2.84 All fuels (cost based on weighted average) (a) 74.5 % 74.3 % 79.8 % 2.63 3.75 2.42 Hydroelectric and solar (b) 1.8 % 1.5 % 1.5 % Total generation 76.3 % 75.8 % 81.3 % Purchased power and net interchange 23.7 % 24.2 % 18.7 % Total sources of energy 100.0 % 100.0 % 100.0 % (a) Statistics related to all fuels reflect EU&I's public utility ownership interest in jointly owned generation facilities.
Cost of Delivered Fuel per Net Generation by Source Kilowatt-hour Generated (Cents) 2024 2023 2022 2024 2023 2022 Natural gas and fuel oil (a) 34.7 % 33.3 % 34.2 % 3.39 3.81 6.35 Nuclear (a) 27.5 % 28.4 % 26.6 % 0.58 0.58 0.58 Coal (a) 14.1 % 12.8 % 13.5 % 4.09 4.07 3.43 All fuels (cost based on weighted average) (a) 76.3 % 74.5 % 74.3 % 2.51 2.63 3.75 Hydroelectric and solar (b) 1.9 % 1.8 % 1.5 % Total generation 78.2 % 76.3 % 75.8 % Purchased power and net interchange 21.8 % 23.7 % 24.2 % Total sources of energy 100.0 % 100.0 % 100.0 % (a) Statistics related to all fuels reflect EU&I's public utility ownership interest in jointly owned generation facilities.
Ghartey-Tagoe joined Duke Energy in 2002 and has held numerous leadership positions in Duke Energy’s Legal Department, including Duke Energy's Senior Vice President of State and Federal Regulatory Legal Support. T. Preston Gillespie 61 Executive Vice President, Chief Generation Officer and Enterprise Operational Excellence. Mr. Gillespie assumed his current position in January 2023.
Ghartey-Tagoe joined Duke Energy in 2002 and has held numerous leadership positions in Duke Energy’s Legal Department, including Duke Energy's Senior Vice President of State and Federal Regulatory Legal Support. T. Preston Gillespie 62 Executive Vice President, Chief Generation Officer and Enterprise Operational Excellence. Mr.
The following table summarizes purchased power for the previous three years: 2023 2022 2021 Purchase obligations and leases (in millions of MWh) (a) 37.6 41.2 36.0 Purchase capacity under contract (in MW) (b) 3,997 4,028 4,259 (a) Represents approximately 15% of total system requirements for 2023, 16% for 2022 and 14% for 2021.
The following table summarizes purchased power for the previous three years: 2024 2023 2022 Purchase obligations and leases (in millions of MWh) (a) 32.1 37.6 41.2 Purchase capacity under contract (in MW) (b) 3,202 3,997 4,028 (a) Represents approximately 12% of total system requirements for 2024, 15% for 2023 and 16% for 2022.
The main feedstocks to produce these products are natural gas and butane. Duke Energy records the investment activity of NMC using the equity method of accounting and retains 25% of NMC's board of directors' representation and voting rights. Human Capital Management Governance Our employees are critical to the success of our company.
Duke Energy records the investment activity of NMC using the equity method of accounting and retains 25% of NMC's board of directors' representation and voting rights. Human Capital Management Governance Our employees are critical to the success of our company.
RTOs PJM and MISO are the ISOs and FERC-approved RTOs for the regions in which Duke Energy Ohio and Duke Energy Indiana operate. PJM and MISO operate energy, capacity and other markets, and control the day-to-day operations of bulk power systems through central dispatch.
These regulations affect the activities of nonregulated affiliates with EU&I. RTOs PJM and MISO are the ISOs and FERC-approved RTOs for the regions in which Duke Energy Ohio and Duke Energy Indiana operate. PJM and MISO operate energy, capacity and other markets, and control the day-to-day operations of bulk power systems through central dispatch.
Kodwo Ghartey-Tagoe 60 Executive Vice President, Chief Legal Officer and Corporate Secretary. Mr. Ghartey-Tagoe assumed his current position in May 2020. He was appointed Executive Vice President and Chief Legal Officer in October 2019 after serving as President, South Carolina since 2017. Mr.
Kodwo Ghartey-Tagoe 61 Executive Vice President, Chief Legal Officer and Corporate Secretary. Mr. Ghartey-Tagoe has served as Executive Vice President, Chief Legal Officer and Corporate Secretary since May 2020. He was appointed Executive Vice President and Chief Legal Officer in October 2019 after serving as President, South Carolina since 2017. Mr.
The following map shows the service territory and investments in operating pipelines for GU&I as of December 31, 2023. The number of residential, commercial and industrial customers within the GU&I service territory is expected to increase over time.
The following map shows the service territory for GU&I as of December 31, 2024. 15 BUSINESS The number of residential, commercial and industrial customers within the GU&I service territory is expected to increase over time.
For more information on rate matters and other regulatory proceedings, see Note 4 to the Consolidated Financial Statements, “Regulatory Matters.” 18 BUSINESS Federal GU&I is subject to various federal regulations, including regulations that are particular to the natural gas industry.
(b) An ROE of 9.3% for natural gas riders was approved. For more information on rate matters and other regulatory proceedings, see Note 4 to the Consolidated Financial Statements, “Regulatory Matters.” Federal GU&I is subject to various federal regulations, including regulations that are particular to the natural gas industry.
EU&I owns and operates facilities necessary to generate, transmit, distribute and sell electricity. Services are priced by state commission-approved rates designed to include the costs of providing these services and a reasonable return on invested capital. This regulatory policy is intended to provide safe and reliable electricity at fair prices. In Ohio, EU&I conducts competitive auctions for electricity supply.
Services are priced by state commission-approved rates designed to include the costs of providing these services and a reasonable return on invested capital. This regulatory policy is intended to provide safe and reliable electricity at fair prices. In Ohio, EU&I conducts competitive auctions for electricity supply. The cost of energy purchased through these auctions is recovered from retail customers.
She originally assumed the position of Executive Vice President, Chief Legal Officer and Corporate Secretary in December 2012 and then assumed the responsibilities for External Affairs in February 2016. Cynthia S. Lee 57 Vice President, Chief Accounting Officer and Controller. Ms. Lee assumed her current position in May 2021.
She originally assumed the position of Executive Vice President, Chief Legal Officer and Corporate Secretary in December 2012 and then assumed the responsibilities for External Affairs in February 2016. Cynthia S. Lee 58 Senior Vice President, Chief Accounting Officer and Controller. Ms. Lee has served as Senior Vice President, Chief Accounting Officer and Controller since November 2024.
Good 64 Chair, President and Chief Executive Officer. Ms. Good has served as Chair, President and Chief Executive Officer of Duke Energy since January 1, 2016, and was Vice Chairman, President and Chief Executive Officer of Duke Energy from July 2013 through December 2015. Prior to that, she served as Executive Vice President and Chief Financial Officer since 2009.
Good has served as Chair and Chief Executive Officer of Duke Energy since April 2024; Chair, President and Chief Executive Officer of Duke Energy from January 2016 to April 2024; and Vice Chairman, President and Chief Executive Officer of Duke Energy from July 2013 through December 2015.
Janson 59 Executive Vice President and Chief Executive Officer, Duke Energy Carolinas. Ms. Janson assumed her current position in May 2021. Prior to that, she served as Executive Vice President, External Affairs and President, Carolinas Region since October 2019 and the position of Executive Vice President, External Affairs and Chief Legal Officer since November 2018.
Prior to that, she served as Executive Vice President, External Affairs and President, Carolinas Region since October 2019 and the position of Executive Vice President, External Affairs and Chief Legal Officer since November 2018.
Duke Energy owns a 17.5% equity interest in NMC. The joint venture company has production facilities in Jubail, Saudi Arabia, where it manufactures certain petrochemicals and plastics. NMC annually produces approximately 1 million metric tons each of MTBE and methanol and has the capacity to produce 50,000 metric tons of polyacetal.
The joint venture company has production facilities in Jubail, Saudi Arabia, where it manufactures certain petrochemicals and plastics. NMC annually produces approximately 1 million metric tons each of MTBE and methanol and has the capacity to produce 50,000 metric tons of polyacetal. The main feedstocks to produce these products are natural gas and butane.
Competition in the regulated electric distribution business is primarily from the development and deployment of alternative energy sources including on-site generation from industrial customers and distributed generation, such as private solar, at residential, general service and/or industrial customer sites.
EU&I earns retail margin in Ohio on the transmission and distribution of electricity, but not on the cost of the underlying energy. Competition in the regulated electric distribution business is primarily from the development and deployment of alternative energy sources including on-site generation from industrial customers and distributed generation, such as private solar, at residential, commercial and/or industrial customer sites.
In residential, commercial and industrial customer markets, natural gas distribution operations compete with other companies that supply energy, primarily electric companies, propane and fuel oil dealers, renewable energy providers and coal companies in relation to sources of energy for electric power plants, as well as nuclear energy. A significant competitive factor is price.
This regulatory policy is intended to provide safe and reliable natural gas service at fair prices. 16 BUSINESS In residential, commercial and industrial customer markets, natural gas distribution operations compete with other companies that supply energy, primarily electric companies, propane and fuel oil dealers, renewable energy providers and coal companies in relation to sources of energy for electric power plants, as well as nuclear energy.
(b) Decommissioning cost for Duke Energy Carolinas reflects its ownership interest in jointly owned reactors. Other joint owners are responsible for decommissioning costs related to their interest in the reactors. (c) Duke Energy Carolinas' site-specific nuclear decommissioning cost study completed in 2023 was filed with the NCUC and PSCSC in 2024.
Other joint owners are responsible for decommissioning costs related to their interest in the reactors. Duke Energy Carolinas' site-specific nuclear decommissioning cost study and a funding study were filed with the NCUC and PSCSC in 2024. (b) Duke Energy Progress' site-specific nuclear decommissioning cost study was filed with the NCUC and PSCSC in February 2025.
See the “Other Matters” section of Item 7 Management's Discussion and Analysis for a discussion about potential Global Climate Change legislation and other EPA regulations under development and the potential impacts such legislation and regulation could have on Duke Energy’s operations. 15 BUSINESS GAS UTILITIES AND INFRASTRUCTURE GU&I conducts natural gas operations primarily through the regulated public utilities of Piedmont, Duke Energy Ohio and Duke Energy Kentucky.
See the “Other Matters” section of Item 7 Management's Discussion and Analysis for a discussion about potential Global Climate Change legislation and other EPA regulations under development and the potential impacts such legislation and regulation could have on Duke Energy’s operations.
Duke Energy entered into purchase and sale agreements with affiliates of Brookfield for the sale of the utility-scale solar and wind group in June 2023 and with affiliates of ArcLight for the distributed generation group in July 2023. Both transactions closed in October 2023. See Note 2 to the Consolidated Financial Statements, “Dispositions," for additional information.
Duke Energy entered into purchase and sale agreements with affiliates of Brookfield for the sale of the utility-scale solar and wind group in June 2023 and with affiliates of ArcLight for the distributed generation group in July 2023. Both transactions closed in October 2023 and the sale of the remaining assets was concluded in January 2025 .
The FERC accepted the filing, as filed on December 9, 2021. (e) During 2019, Duke Energy Florida reached an agreement to transfer decommissioning work for Crystal River Unit 3 to a third party and decommissioning costs are based on the agreement with this third party rather than a cost study.
An updated funding study will be completed and filed with the NCUC and PSCSC in 2025. (c) During 2019, Duke Energy Florida reached an agreement to transfer decommissioning work for Crystal River Unit 3 to a third party and decommissioning costs are based on the agreement with this third party rather than a cost study.
Duke Duke Duke Duke Duke Energy Energy Energy Energy Energy Carolinas Progress Florida Ohio Indiana Residential 32 % 26 % 50 % 37 % 28 % General service 34 % 22 % 36 % 38 % 26 % Industrial 23 % 15 % 8 % 23 % 31 % Total retail sales 89 % 63 % 94 % 98 % 85 % Wholesale and other sales 11 % 37 % 6 % 2 % 15 % Total sales 100 % 100 % 100 % 100 % 100 % The number of residential and general service customers within the EU&I service territory is expected to increase over time.
Duke Duke Duke Duke Duke Energy Energy Energy Energy Energy Carolinas Progress Florida Ohio Indiana Residential 33 % 27 % 50 % 37 % 29 % Commercial 33 % 22 % 36 % 39 % 26 % Industrial 22 % 14 % 7 % 22 % 30 % Total retail sales 88 % 63 % 93 % 98 % 85 % Wholesale and other sales 12 % 37 % 7 % 2 % 15 % Total sales 100 % 100 % 100 % 100 % 100 % The number of retail customers within the EU&I service territory is expected to increase over time.
EU&I has interconnections and arrangements with its neighboring utilities to facilitate planning, emergency assistance, sale and purchase of capacity and energy and reliability of power supply. EU&I’s generation portfolio is a balanced mix of energy resources having different operating characteristics and fuel sources designed to provide energy at the lowest possible cost to meet its obligation to serve retail customers.
EU&I’s generation portfolio is a balanced mix of energy resources having different operating characteristics and fuel sources designed to provide energy at the lowest cost to meet its obligation to serve retail customers.
Services are priced by state commission-approved rates designed to include the costs of providing these services and a reasonable return on invested capital. This regulatory policy is intended to provide safe and reliable natural gas service at fair prices.
Services are priced by state commission-approved rates designed to include the costs of providing these services and a reasonable return on invested capital.
The underlying concept of utility ratemaking is to set rates at a level that allows the utility to collect revenues equal to its cost of providing service plus earn a reasonable rate of return on its invested capital, including equity. 14 BUSINESS In addition to rates approved in base rate cases, each of the state electric utility commissions allow recovery of certain costs through various cost recovery clauses to the extent the respective commission determines in periodic hearings that such costs, including any past over or under-recovered costs, are prudent.
In addition to rates approved in base rate cases, each of the state utility commissions allow recovery of certain costs through various cost recovery clauses to the extent the respective commission determines in periodic hearings that such costs, including any past over or under-recovered costs, are prudent.
The Duke Energy Foundation is a nonprofit organization funded by Duke Energy shareholders that makes charitable contributions to selected nonprofits and government subdivisions. Bison, a wholly owned subsidiary of Duke Energy, is a captive insurance company with the principal activity of providing Duke Energy subsidiaries with indemnification for financial losses primarily related to property, workers’ compensation and general liability.
Bison, a wholly owned subsidiary of Duke Energy, is a captive insurance company with the principal activity of providing Duke Energy subsidiaries with indemnification for financial losses primarily related to property, workers’ compensation and general liability. Duke Energy owns a 17.5% equity interest in NMC.
KO Transmission sold all of its pipeline facilities and related real property to Columbia Gas Transmission, LLC on February 1, 2023, for approximately book value. Substantially all of Duke Energy Ohio's operations are regulated and qualify for regulatory accounting. Duke Energy Ohio has two reportable segments, EU&I and GU&I.
For information about Duke Energy Ohio's generating facilities and natural gas distribution facilities, see Item 2, “Properties.” Duke Energy Ohio sold all of KO Transmission's pipeline facilities and related real property to Columbia Gas Transmission, LLC in February 2023 for approximately book value. Substantially all of Duke Energy Ohio's operations are regulated and qualify for regulatory accounting.
Regulatory Body Annual Increase (Decrease) (in millions) Return on Equity Equity Component of Capital Structure Effective Date Approved Rate Cases: Duke Energy Ohio 2022 Natural Gas Base Rate Case PUCO $ 32 9.6 % 52.32 % November 2023 Piedmont 2023 Tennessee Annual Review Mechanism TPUC 40 9.8 % 48.67 % October 2023 Duke Energy Kentucky 2021 Natural Gas Base Rate Case (a) KPSC 9 9.375 % 51.344 % January 2022 Piedmont 2021 North Carolina Natural Gas Base Rate Case NCUC 67 9.6 % 51.60 % November 2021 Piedmont 2020 Tennessee Natural Gas Base Rate Case TPUC 16 9.8 % 50.50 % January 2021 (a) An ROE of 9.3% for natural gas riders was approved.
Regulatory Body Revenue Increase (Decrease) (in millions) Return on Equity Equity Component of Capital Structure Effective Date Approved Rate Cases: Piedmont 2024 North Carolina Rate Case (a) NCUC $ 88 9.8 % 52.30 % November 2024 Duke Energy Ohio 2022 Natural Gas Base Rate Case PUCO 32 9.6 % 52.32 % November 2023 Duke Energy Kentucky 2021 Natural Gas Base Rate Case (b) KPSC 9 9.375 % 51.344 % January 2022 (a) Year 2 and thereafter will include an additional $10 million in revenues.
KO Transmission sold all of its pipeline facilities and related real property to Columbia Gas Transmission, LLC on February 1, 2023, for approximately book value.
Pine Needle and Hardy Storage are regulated by FERC. GU&I sold all of KO Transmission's pipeline facilities and related real property to Columbia Gas Transmission, LLC in February 2023 for approximately book value.
These regulations classify CCR as nonhazardous waste under the Resource Conservation and Recovery Act (RCRA) and apply to electric generating sites with new and existing landfills and new and existing surface impoundments and establish requirements regarding landfill design, structural integrity design and assessment criteria for surface impoundments, groundwater monitoring, protection and remedial procedures and other operational and reporting procedures for the disposal and management of CCR.
These regulations classify CCR as nonhazardous waste under RCRA and apply to electric generating sites with new and existing landfills and new and existing surface impoundments and establish requirements regarding design and operating criteria, groundwater monitoring and corrective action, closure requirements and post-closure care, and recordkeeping, notifications, and internet posting requirements for the disposal and management of CCR.
Although decoupling mechanisms may mitigate some weather impacts, residential and general service customers are typically more impacted by weather than industrial customers. Estimated weather impacts are based on actual current period weather compared to normal weather conditions.
By contrast, lower sales of electricity occur during the spring and fall, allowing for scheduled plant maintenance. Residential and commercial customers are typically more impacted by weather than industrial customers, although decoupling mechanisms in certain jurisdictions may mitigate some of the weather impacts. Estimated weather impacts are based on actual current period weather compared to normal weather conditions.
Each degree of temperature below the base temperature counts as one heating degree day and each degree of temperature above the base temperature counts as one cooling degree day. Competition Retail EU&I’s businesses operate as the sole supplier of electricity within their service territories, with the exception of Ohio, which has a competitive electricity supply market for generation service.
Competition Retail EU&I’s businesses operate as the sole supplier of electricity within their service territories, with the exception of Ohio, which has a competitive electricity supply market for generation service. EU&I owns and operates facilities necessary to generate, transmit, distribute and sell electricity.
Our Board of Directors provides oversight on certain human capital management matters, primarily through the Compensation and People Development Committee, which is responsible for reviewing strategies and policies related to human capital management, including with respect to matters such as diversity and inclusion, employee engagement and talent development.
Our Board of Directors provides oversight on certain human capital management matters, primarily through the Compensation and People Development Committee, which is responsible for reviewing strategies and policies related to human capital management, including employee engagement and talent development. 18 BUSINESS Employees On December 31, 2024, Duke Energy had a total of 26,413 full-time, part-time and temporary employees, the majority of which were full-time employees.
For more information on rate matters and other regulatory proceedings, see Note 4 to the Consolidated Financial Statements, “Regulatory Matters.” Federal The FERC approves EU&I’s cost-based rates for electric sales to certain power and transmission wholesale customers.
For more details, see Note 4 to the Consolidated Financial Statements, “Regulatory Matters.” Federal The FERC approves EU&I’s cost-based rates for electric sales to certain power and transmission wholesale customers. Regulations of FERC and the state utility commissions govern access to regulated electric and other data by nonregulated entities and services provided between regulated and nonregulated energy affiliates.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition to the federal regulations, CCR landfills and surface impoundments will continue to be regulated by existing state laws, regulations and permits, as well as additional legal requirements that may be imposed in the future, such as the settlement reached with the NCDEQ to excavate seven of the nine remaining coal ash basins in North Carolina, and partially excavate the remaining two, and the EPA's January 11, 2022, issuance of a letter interpreting the CCR Rule, including its applicability and closure provisions.
Biggest changeIn addition to the federal regulations, CCR landfills and surface impoundments will continue to be regulated by existing state laws, regulations and permits, as well as additional legal requirements, including judicial orders.
Because Duke Energy is a holding company with no operations or cash flows of its own, its ability to meet its financial obligations, including making interest and principal payments on outstanding indebtedness and to pay dividends on its common stock, is primarily dependent on the net income and cash flows of its subsidiaries and the ability of those subsidiaries to pay upstream dividends or to repay borrowed funds.
Because Duke Energy is a holding company with no operations or cash flows of its own, its ability to meet its financial obligations, including making interest and principal payments on outstanding indebtedness and to pay dividends on its common and preferred stock, is primarily dependent on the net income and cash flows of its subsidiaries and the ability of those subsidiaries to pay upstream dividends or to repay borrowed funds.
Rapidly rising prices as a result of inflation or other factors may impact the ability of the Company to recover costs timely or execute on its business strategy including the achievement of growth objectives. The Duke Energy Registrants sell electricity into the spot market or other competitive power markets on a contractual basis.
Rapidly rising prices as a result of inflation, tariffs, or other factors may impact the ability of the Company to recover costs timely or execute on its business strategy including the achievement of growth objectives. The Duke Energy Registrants sell electricity into the spot market or other competitive power markets on a contractual basis.
In addition, Duke Energy may provide capital contributions or debt financing to its subsidiaries under certain circumstances, which would reduce the funds available to meet its financial obligations, including making interest and principal payments on outstanding indebtedness and to pay dividends on Duke Energy’s common stock.
In addition, Duke Energy may provide capital contributions or debt financing to its subsidiaries under certain circumstances, which would reduce the funds available to meet its financial obligations, including making interest and principal payments on outstanding indebtedness and to pay dividends on Duke Energy’s common and preferred stock.
The Duke Energy Registrants' operations, capital expenditures and financial results may be affected by regulatory changes related to the impacts of global climate change. There is continued concern, and increasing activism, both nationally and internationally, about climate change.
The Duke Energy Registrants' operations, capital expenditures and financial results may be affected by regulatory changes related to the impacts of global climate change. There is continued concern, and increasing and conflicting activism, both nationally and internationally, about climate change.
The COVID-19 pandemic and efforts to respond to it have resulted in widespread adverse consequences on the global economy and on the Duke Energy Registrants’ customers, third-party vendors, and other parties with whom we do business.
The COVID-19 pandemic and efforts to respond to it resulted in widespread adverse consequences on the global economy and on the Duke Energy Registrants’ customers, third-party vendors, and other parties with whom we do business.
Additionally, rapidly rising interest rates could impact the ability to affordably finance the capital plan or increase rates to customers and could have an impact on our ability to execute on our clean energy transition.
Additionally, rapidly rising interest rates could impact the ability to affordably finance the capital plan or increase rates to customers and could have an impact on our ability to execute on our energy transition.
The Duke Energy Registrants will continue to seek full cost recovery for expenditures through the normal ratemaking process with state and federal utility commissions, who permit recovery in rates of necessary and prudently incurred costs associated with the Duke Energy Registrants’ regulated operations, and through other wholesale contracts with terms that contemplate recovery of such costs, although there is no guarantee of full cost recovery.
The Duke Energy Registrants will continue to seek full cost recovery for expenditures through the normal ratemaking process with state and federal utility commissions, who permit recovery in rates of reasonable and prudently incurred costs associated with the Duke Energy Registrants’ regulated operations, and through other wholesale contracts with terms that contemplate recovery of such costs, although there is no guarantee of full cost recovery.
Cybersecurity risks have increased in recent years as a result of the proliferation of new technologies and the increased sophistication, magnitude and frequency of cyberattacks and data security breaches. Duke Energy relies on the continued operation of sophisticated digital information technology systems and network infrastructure, which are part of an interconnected regional grid.
Cybersecurity risks have increased in recent years as a result of the proliferation of new technologies and the increased sophistication, magnitude and frequency of cyberattacks and data security breaches. Duke Energy relies on the continued operation of advanced digital information technology systems and network infrastructure, which are part of an interconnected regional grid.
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 and distribution services; make acquisitions; issue equity or debt securities; engage in transactions with other subsidiaries and affiliates; and pay dividends upstream to the Duke Energy Registrants.
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 for services; make acquisitions; issue equity or debt securities; engage in transactions with other subsidiaries and affiliates; and pay dividends upstream to the Duke Energy Registrants.
Over time, customer adoption of these technologies could result in Duke Energy not being able to fully recover the costs and investment in generation. State regulators have approved various mechanisms to stabilize natural gas utility margins, including margin decoupling in North Carolina and rate stabilization in South Carolina.
Over time, customer adoption of these technologies could result in Duke Energy not being able to fully recover the costs and investment in generation. 23 RISK FACTORS State regulators have approved various mechanisms to stabilize natural gas utility margins, including margin decoupling in North Carolina and rate stabilization in South Carolina.
Failure to maintain these covenants at a particular entity could preclude Duke Energy from issuing commercial paper or the Duke Energy Registrants from issuing letters of credit or borrowing under the Master Credit Facility. 30 RISK FACTORS The Duke Energy Registrants must meet credit quality standards and there is no assurance they will maintain investment grade credit ratings.
Failure to maintain these covenants at a particular entity could preclude Duke Energy from issuing commercial paper or the Duke Energy Registrants from issuing letters of credit or borrowing under the Master Credit Facility. The Duke Energy Registrants must meet credit quality standards and there is no assurance they will maintain investment grade credit ratings.
Disruption in the delivery of fuel, including disruptions as a result of, among other things, bankruptcies, transportation delays, weather, labor relations, force majeure events or environmental regulations affecting any of these fuel suppliers, could limit the Duke Energy Registrants' ability to operate their facilities.
Disruption in the delivery of fuel, including disruptions as a result of, among other things, changing economic conditions, bankruptcies, transportation delays, weather, labor relations, force majeure events or environmental regulations affecting any of these fuel suppliers, could limit the Duke Energy Registrants' ability to operate their facilities.
In addition, if any construction work or investments have been recorded as an asset, an impairment may need to be recorded in the event the project is canceled. 29 RISK FACTORS The Duke Energy Registrants are subject to risks associated with their ability to obtain adequate insurance at acceptable costs.
In addition, if any construction work or investments have been recorded as an asset, an impairment may need to be recorded in the event the project is canceled. The Duke Energy Registrants are subject to risks associated with their ability to obtain adequate insurance at acceptable costs.
Additionally, the risks of global climate change continues to shape our customers’ sustainability goals and energy needs as well as the investment and financing criteria of investors.
Additionally, the risks of global climate change continue to shape our customers’ sustainability goals and energy needs as well as the investment and financing criteria of investors.
Downgrades in the Duke Energy Registrants’ credit ratings could lead to additional collateral posting requirements. The Duke Energy Registrants continually monitor derivative positions in relation to market price activity. 28 RISK FACTORS Cyberattacks and data security breaches could adversely affect the Duke Energy Registrants' businesses.
Downgrades in the Duke Energy Registrants’ credit ratings could lead to additional collateral posting requirements. The Duke Energy Registrants continually monitor derivative positions in relation to market price activity. Cyberattacks and data security breaches could adversely affect the Duke Energy Registrants' businesses.
The Duke Energy Registrants are also subject to regulations set by the Nuclear Regulatory Commission regarding the protection of digital computer and communication systems and networks required for the operation of nuclear power plants.
The Duke Energy Registrants are also subject to regulations set by the NRC regarding the protection of digital computer and communication systems and networks required for the operation of nuclear power plants.
The Duke Energy Registrants’ operations have been and may be affected by pandemic health events, including COVID-19, in ways listed below and in ways the Duke Energy Registrants cannot predict at this time.
The Duke Energy Registrants’ operations have been and may be affected by pandemic health events in ways listed below and in ways the Duke Energy Registrants cannot predict at this time.
Delays in obtaining any required environmental regulatory approvals, failure to obtain and comply with them or changes in environmental laws or regulations to more stringent compliance levels could result in additional costs of operation for existing facilities or development of new facilities being prevented, delayed or subject to additional costs.
Delays in obtaining any required environmental regulatory approvals, failure to obtain and comply with them or changes in 24 RISK FACTORS environmental laws or regulations to more stringent compliance levels could, and are likely to, result in additional costs of operation for existing facilities or development of new facilities being prevented, delayed or subject to additional costs.
Stranded costs primarily include the generation assets of the Duke Energy Registrants whose value in a competitive marketplace may be less than their current book value, as well as above-market purchased power commitments from QFs from whom the Duke Energy Registrants are legally obligated to purchase energy at an avoided cost rate under PURPA.
Stranded costs primarily include the generation assets of the Duke Energy Registrants whose value in a competitive marketplace may be less than their current book value, as well as above-market purchased power commitments from QFs from whom the Duke Energy Registrants are legally obligated to purchase energy at an avoided cost rate under the Public Utility Regulatory Policies Act of 1978.
In addition, new technologies that are not yet commercially available or are unproven at utility scale will likely be needed including new resources capable of following electric load over long durations such as advanced nuclear, hydrogen and long-duration storage.
In addition, new technologies that are not yet commercially available or are unproven at utility scale will likely be needed, including carbon capture and sequestration and supporting infrastructure as well as new resources capable of following electric load over long durations such as advanced nuclear, hydrogen and long-duration storage.
Federal or state policies could be enacted that restrict the availability of fuels or generation technologies, such as natural gas or nuclear power, that enable Duke Energy to reduce its carbon emissions.
Federal or state policies could be enacted that restrict the availability of, and increase the costs associated with the use of, fuels or generation technologies, such as natural gas or nuclear power, that enable Duke Energy to reduce its carbon emissions.
Additionally, if regulatory or legislative bodies do not allow recovery of costs incurred in providing service, or do not do so on a timely basis, the Duke Energy Registrants’ earnings could be negatively impacted.
Additionally, if regulatory or legislative bodies do not allow recovery of costs incurred in providing service, or do not do so on a timely basis, the Duke Energy Registrants’ results of operations, financial position or cash flows could be negatively impacted.
Customer growth and customer usage are affected by several factors outside the control of the Duke Energy Registrants, such as mandated EE measures, demand-side management goals, distributed generation resources and economic and demographic conditions, such as inflation and interest rate volatility, population changes, job and income growth, housing starts, new business formation and the overall level of economic activity.
Customer growth and customer usage are affected by several factors outside the control of the Duke Energy Registrants, such as mandated EE measures, demand-side management goals, advancements in technology that may impact the energy usage by large commercial customers, such as data centers, distributed generation resources and economic and demographic conditions, such as inflation, tariffs, and interest rate volatility, population changes, job and income growth, housing starts, new business formation and the overall level of economic activity.
Natural disasters or operational accidents may adversely affect the Duke Energy Registrants’ operating results. Natural disasters or operational accidents within the Company or industry (such as forest fires, earthquakes, hurricanes or natural gas transmission pipeline explosions) could have direct or indirect impacts to the Duke Energy Registrants or to key contractors and suppliers.
Natural disasters or operational accidents within the Company or industry (such as wild fires, earthquakes, hurricanes or natural gas transmission pipeline explosions) could have direct or indirect impacts to the Duke Energy Registrants or to key contractors and suppliers.
Factors that could impact sales volumes, generation of electricity and market prices at which the Duke Energy Registrants are able to sell electricity and natural gas are as follows: • weather conditions, including abnormally mild winter or summer weather that cause lower energy or natural gas usage for heating or cooling purposes, as applicable, and periods of low rainfall that decrease the ability to operate facilities in an economical manner; • supply of and demand for energy commodities; • transmission or transportation constraints or inefficiencies; • availability of purchased power; • availability of competitively priced alternative energy sources, which are preferred by some customers over electricity produced from coal, nuclear or natural gas plants, and customer usage of energy-efficient equipment that reduces energy demand; • natural gas, crude oil and refined products production levels and prices; • ability to procure satisfactory levels of inventory, including materials, supplies, and fuel such as coal, natural gas and uranium; and • capacity and transmission service into, or out of, the Duke Energy Registrants’ markets.
Factors that could impact sales volumes, generation of electricity and market prices at which the Duke Energy Registrants are able to sell electricity and natural gas are as follows: • weather conditions, including extreme winter or summer weather that could cause significantly lower or higher demand for energy or natural gas usage for heating or cooling purposes, as applicable, storm-related customer outages resulting in lower usage, or periods of low rainfall that decrease the ability to operate facilities in an economical manner; • supply of and demand for energy commodities, including potential usage of electricity by data centers; • transmission or transportation constraints or inefficiencies; • availability of purchased power; • availability of competitively priced alternative energy sources, which are preferred by some customers over electricity produced from coal, nuclear or natural gas plants, and customer usage of energy-efficient equipment that reduces energy demand; • natural gas, crude oil and refined products production levels and prices; • ability to procure satisfactory levels of inventory, including materials, supplies, and fuel such as coal, natural gas and uranium; and • capacity and transmission service into, or out of, the Duke Energy Registrants’ markets. 25 RISK FACTORS Natural disasters or operational accidents may adversely affect the Duke Energy Registrants’ operating results, financial position or cash flows.
Electric power generation and natural gas distribution are generally seasonal businesses. In most parts of the U.S., the demand for power peaks during the warmer summer months, with market prices also typically peaking at that time. In other areas, demand for power peaks during the winter. Demand for natural gas peaks during the winter months.
In most parts of the U.S., the demand for power peaks during the warmer summer months, with market prices also typically peaking at that time. In other areas, demand for power peaks during the winter. Demand for natural gas peaks during the winter months.
The Duke Energy Registrants future results of operations may be impacted by changing expectations and demands including heightened emphasis on environmental, social and governance concerns. Duke Energy’s ability to execute its strategy and achieve anticipated financial outcomes are influenced by the expectations of our customers, regulators, investors, and stakeholders.
The Duke Energy Registrants' future results of operations may be impacted by changing or conflicting expectations and demands, particularly regarding environmental, social and governance concerns. Duke Energy’s ability to execute its strategy and achieve anticipated financial outcomes are influenced by the expectations of our customers, regulators, investors and stakeholders.
The Duke Energy Registrants are subject to numerous environmental laws and regulations affecting many aspects of their present and future operations, including CCRs, air emissions, water quality, wastewater discharges, solid waste and hazardous waste. These laws and regulations can result in increased capital, operating and other costs.
The Duke Energy Registrants are subject to numerous environmental laws and regulations affecting many aspects of their present and future operations, including CCRs, air emissions, water quality, wastewater discharges, solid waste and hazardous waste.
Furthermore, destruction caused by severe weather events, such as hurricanes, flooding, tornadoes, severe thunderstorms, snow and ice storms, including from climate change, can result in lost operating revenues due to outages, property damage, including downed transmission and distribution lines, reputational harm, and additional and unexpected expenses to mitigate storm damage.
Furthermore, destruction caused by severe weather events, such as hurricanes, flooding, tornadoes, severe thunderstorms, snow and ice storms, droughts, extreme temperatures, and wild fires, including from climate change, can result in lost operating revenues due to outages, property damage or total loss, including downed transmission and distribution lines, personal injury, reputational harm, and additional and unexpected expenses to mitigate storm damage, including incremental financing costs.
Some or all of these factors could result in a lack of growth or decline in customer demand for electricity or number of customers and may cause the failure of the Duke Energy Registrants to fully realize anticipated benefits from significant capital investments and expenditures, which could have a material adverse effect on their results of operations, financial position and cash flows.
Some or all of these factors could result in a lack of growth or decline in customer demand for electricity or number of customers and may cause the failure of the Duke Energy Registrants to fully realize anticipated benefits from significant capital investments and expenditures, which could have a material adverse effect on their results of operations, financial position and cash flows. 26 RISK FACTORS Furthermore, the Duke Energy Registrants currently have EE riders in place to recover the cost of EE programs in North Carolina, South Carolina, Florida, Indiana, and Kentucky.
If Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida are unable to successfully manage their NDTF assets or if the cost of decommissioning nuclear generation facilities exceeds the amount available in decommissioning funds and such costs cannot be recovered through insurance or regulatory mechanisms, their results of operations, financial position and cash flows could be negatively affected.
If Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida are unable to successfully manage their NDTF assets or if the cost of decommissioning nuclear generation facilities exceeds the amount available in decommissioning funds and such costs cannot be recovered through insurance or regulatory mechanisms, their results of operations, financial position and cash flows could be negatively affected. 30 RISK FACTORS Poor investment performance of the Duke Energy pension plan holdings and other factors impacting pension plan costs could unfavorably impact the Duke Energy Registrants’ liquidity and results of operations.
Achieving our carbon reduction goals will require continued operation of our existing carbon-free technologies including nuclear and renewables. The rapid transition to and expansion of certain low-carbon resources, such as renewables without cost-effective storage, may challenge our ability to meet customer expectations of reliability in a carbon constrained environment.
Meeting the evolving and growing energy needs of our customers will require continued operation of our existing carbon-free technologies including nuclear and renewables. The rapid transition to and expansion of certain low-carbon resources, such as renewables without cost-effective storage, may challenge our ability to meet customer expectations of reliability and affordability in a carbon constrained environment, particularly as demand increases.
Negative decisions made by these regulators, or by any court on appeal of a rate case proceeding, have, and in the future could have, a material adverse effect on the Duke Energy Registrants’ results of operations, financial position or cash flows and affect the ability of the Duke Energy Registrants to adequately recover costs on a timely basis, including an appropriate return on the significant infrastructure investments being made. 24 RISK FACTORS Deregulation or restructuring in the electric industry may result in increased competition and unrecovered costs that could adversely affect the Duke Energy Registrants’ results of operations, financial position or cash flows and their utility businesses.
Negative decisions made by these regulators, or by any court on appeal of a rate case proceeding, have, and in the future could have, a material adverse effect on the Duke Energy Registrants’ results of operations, financial position or cash flows and affect the ability of the Duke Energy Registrants to adequately recover costs on a timely basis, including an appropriate return on the significant infrastructure investments being made.
If the COVID-19 pandemic or other health epidemics and outbreaks that may occur are significantly prolonged, it could impact the Duke Energy Registrants' business strategy, results of operations, financial position and cash flows in the future as a result of delays in rate cases or other legal proceedings, an inability to obtain labor or equipment necessary for the construction of large capital projects, an inability to procure satisfactory levels of fuels or other necessary equipment for the continued production of electricity and delivery of natural gas, volatility in global equity securities markets, and the health and availability of our critical personnel and their ability to perform business functions.
If another pandemic or health epidemic or outbreak occurs and is significantly prolonged, it could impact the Duke Energy Registrants' business strategy, results of operations, financial position and cash flows in the future as a result of delays in rate cases or other legal proceedings, an inability to obtain labor or equipment necessary for the construction of large capital projects, an inability to procure satisfactory levels of fuels or other necessary equipment for the continued production of electricity and delivery of natural gas, volatility in global equity securities markets, and the health and availability of our critical personnel and their ability to perform business functions. 28 RISK FACTORS Duke Energy Ohio’s and Duke Energy Indiana’s membership in an RTO presents risks that could have a material adverse effect on their results of operations, financial position and cash flows.
As a result, the Duke Energy Registrants may be required to shut down or alter the operation of their facilities, which may cause the Duke Energy Registrants to incur losses.
The steps the Duke Energy Registrants could be required to take to ensure their facilities are in compliance could be prohibitively expensive. As a result, the Duke Energy Registrants may be required to shut down or alter the operation of their facilities, which may cause the Duke Energy Registrants to incur losses.
Regulatory changes could also result in generation facilities to be retired earlier than planned to meet our net-zero 2050 goal.
Regulatory changes and/or uncertainty of applicability of such legislative and regulatory initiatives could also result in generation facilities to be retired earlier than planned to meet our net-zero 2050 goal.
The cost of storm restoration efforts may not be fully recoverable through the regulatory process. The Duke Energy Registrants’ sales may decrease if they are unable to gain adequate, reliable and affordable access to transmission assets.
The cost of storm restoration efforts may not be fully recoverable or recoverable on a timely basis through the regulatory process and may impact the results of operations, financial position or cash flows of the Duke Energy Registrants. The Duke Energy Registrants’ sales may decrease if they are unable to gain adequate, reliable and affordable access to transmission assets.
Duke Energy’s information technology systems are critical to cost-effective, reliable daily operations and our ability to effectively serve our customers. We expect our customers to continue to demand more sophisticated technology-driven solutions and we must enhance or replace our information technology systems in response. This involves significant development and implementation costs to keep pace with changing technologies and customer demand.
We expect our customers to continue to demand more sophisticated technology-driven solutions and we must enhance or replace our information technology systems in response. This involves significant development and implementation costs to keep pace with changing technologies, including artificial intelligence, and customer demand.
Risks identified at the Subsidiary Registrant level are generally applicable to Duke Energy. 23 RISK FACTORS BUSINESS STRATEGY RISKS Duke Energy’s future results could be adversely affected if it is unable to implement its business strategy including achieving its carbon emissions reduction goals.
Risks identified at the Subsidiary Registrant level are generally applicable to Duke Energy. 22 RISK FACTORS BUSINESS STRATEGY RISKS Duke Energy’s future results could be adversely affected if it is unable to implement its business strategy to reliably and affordably serve its customers while also balancing its grid and fleet modernization objectives and carbon emissions reduction goals.
The Duke Energy Registrants’ businesses are significantly financed through issuances of debt and equity. The maturity and repayment profile of debt used to finance investments often does not correlate to cash flows from their assets.
Access to those markets can be adversely affected by a number of conditions, many of which are beyond the Duke Energy Registrants’ control. The Duke Energy Registrants’ businesses are significantly financed through issuances of debt and equity. The maturity and repayment profile of debt used to finance investments often does not correlate to cash flows from their assets.
In addition, the timing for and amount of recovery of such costs could have a material adverse impact on Duke Energy's cash flows. The Duke Energy Registrants have recognized significant AROs related to these CCR-related requirements. Closure activities began in 2015 at the four sites specified as high priority by the Coal Ash Act and at the W.S.
In addition, the timing for and amount of recovery of such costs could have a material adverse impact on Duke Energy's cash flows. The Duke Energy Registrants have recognized significant AROs related to these CCR-related requirements.
Furthermore, with this heightened emphasis on environmental, social, and governance concerns, and climate change in particular, there is an increased risk of litigation, activism, and legislation from groups both in support of and opposed to various environmental, social and governance initiatives, which could cause delays and increase the costs of our clean energy transition. 27 RISK FACTORS The Duke Energy Registrants’ operating results may fluctuate on a seasonal and quarterly basis and can be negatively affected by changes in weather conditions and severe weather, including extreme weather conditions and changes in weather patterns from climate change.
Furthermore, with this heightened emphasis on environmental, social, and governance concerns, and climate change in particular, there is an increased risk of litigation, activism, and legislation from groups both in support of and opposed to various environmental, social and governance initiatives, which could cause delays and increase the costs of our energy transition.
Changes to federal regulations are continuous and ongoing. There can be no assurance that laws, regulations and policies will not be changed in ways that result in material modifications of business models and objectives or affect returns on investment by restricting activities and products, subjecting them to escalating costs, causing delays, or prohibiting them outright.
There can be no assurance that laws, regulations and policies, including tax incentives and credits, will not be changed in ways that result in material modifications of business models and objectives or affect returns on investment by restricting activities and products, subjecting them to escalating costs, causing delays, or prohibiting them outright, which could have a material effect on the Duke Energy Registrants' results of operations, financial position and cash flows.
These laws and regulations generally require the Duke Energy Registrants to obtain and comply with a wide variety of environmental licenses, permits, inspections and other approvals. Compliance with environmental laws and regulations can require significant expenditures, including expenditures for cleanup costs and damages arising from contaminated properties.
These and other environmental laws and regulations can result in increased capital, operating and other costs. These laws and regulations generally require the Duke Energy Registrants to obtain and comply with a wide variety of environmental licenses, permits, inspections and other approvals.
Conversely, jurisdictions utilizing more carbon-intensive generation such as coal may experience difficulty attracting certain investors and obtaining the most economical financing terms available.
As it relates to electric generation, a diversified fleet with increasingly clean generation resources may facilitate more efficient financing and lower costs. Conversely, jurisdictions utilizing more carbon-intensive generation such as coal may experience difficulty attracting certain investors and obtaining the most economical financing terms available.
The EPA has issued or proposed federal regulations governing the management of cooling water intake structures, wastewater, CCR management units, and CO 2 emissions. New state legislation could impose carbon reduction goals that are more aggressive than the Company's plans. These regulations may require the Duke Energy Registrants to make additional capital expenditures and increase operating and maintenance costs.
New state legislation in response to such regulations could impose carbon reduction goals that are more aggressive than the Company's plans. These regulations may require the Duke Energy Registrants to make additional capital expenditures and increase operating and maintenance costs.
In addition, if a serious nuclear incident were to occur, it could have a material adverse effect on the results of operations, financial position, cash flows and reputation of the Duke Energy Registrants.
In addition, if a serious nuclear incident were to occur, it could have a material adverse effect on the results of operations, financial position, cash flows and reputation of the Duke Energy Registrants. 29 RISK FACTORS LIQUIDITY, CAPITAL REQUIREMENTS AND COMMON STOCK RISKS The Duke Energy Registrants rely on access to short-term borrowings and longer-term debt and equity markets to finance their capital requirements and support their liquidity needs.
Though we would plan to seek cost recovery for investments related to GHG emissions reductions through regulatory rate structures, changes in the regulatory climate could result in the delay in or failure to fully recover such costs and investment in generation. 25 RISK FACTORS OPERATIONAL RISKS The Duke Energy Registrants’ results of operations may be negatively affected by overall market, economic and other conditions that are beyond their control.
Though we would plan to seek cost recovery for investments related to GHG emissions reductions through regulatory rate structures, changes in the regulatory climate could result in the delay in or failure to fully recover such costs and investment in generation.
Moreover, if additional natural gas infrastructure, including, but not limited to, exploration and drilling rigs and platforms, processing and gathering systems, offshore pipelines, interstate pipelines and storage, cannot be built at a pace that meets demand, then growth opportunities could be limited.
Moreover, if additional natural gas infrastructure, including, but not limited to, exploration and drilling rigs and platforms, processing and gathering systems, offshore pipelines, interstate pipelines and storage, cannot be built at a pace that meets demand, then growth opportunities could be limited. 27 RISK FACTORS Fluctuations in commodity prices or availability may adversely affect various aspects of the Duke Energy Registrants’ operations as well as their results of operations, financial position and cash flows.
Duke Energy's clean energy transition, which includes achieving net-zero carbon emissions from electricity generation by 2050, modernizing the regulatory construct, transforming the customer experience, and digital transformation, is subject to business, policy, regulatory, technology, economic and competitive uncertainties and contingencies, many of which are beyond its control and may make those goals difficult to achieve.
Duke Energy is subject to business, policy, regulatory, technology, economic and competitive uncertainties and contingencies, many of which are beyond its control and may make those goals difficult to achieve.
These providers’ systems are susceptible to cybersecurity and data breaches, outages from fire, floods, power loss, telecommunications failures, break-ins and similar events.
These providers’ systems are susceptible to cybersecurity and data breaches, outages from fire, floods, power loss, telecommunications failures, break-ins and similar events. Failure to prevent or mitigate data loss from system failures or outages could materially affect the results of operations, financial position and cash flows of the Duke Energy Registrants.
Furthermore, the increasing use of social media may accelerate and increase the potential scope of negative publicity we might receive and could increase the negative impact on our reputation, business, results of operations, and financial condition. As it relates to electric generation, a diversified fleet with increasingly clean generation resources may facilitate more efficient financing and lower costs.
Furthermore, the increasing use of social media and conflicting expectations and demands regarding environmental, social, and governance concerns, may accelerate and increase the potential scope of negative publicity we might receive and could increase the negative impact on our reputation, business, results of operations and financial condition.
Sustained downturns or sluggishness in the economy generally affect the markets in which the Duke Energy Registrants operate and negatively influence operations.
OPERATIONAL RISKS The Duke Energy Registrants’ results of operations may be negatively affected by overall market, economic and other conditions that are beyond their control. Sustained downturns or sluggishness in the economy generally affect the markets in which the Duke Energy Registrants operate and negatively influence operations.
A CCR-related operational incident could have a material adverse impact on the reputation and results of operations, financial position and cash flows of the Duke Energy Registrants. 26 RISK FACTORS During 2015, EPA regulations were enacted related to the management of CCR from power plants.
A CCR-related operational incident could have a material adverse impact on the reputation and results of operations, financial position and cash flows of the Duke Energy Registrants. The 2015 CCR Rule classifies CCR as nonhazardous waste and allows for beneficial use of CCR with some restrictions.
Failure to prevent or mitigate data loss from system failures or outages could materially affect the results of operations, financial position and cash flows of the Duke Energy Registrants. 31 RISK FACTORS In addition to maintaining our current information technology systems, Duke Energy believes the digital transformation of its business is key to driving internal efficiencies as well as providing additional capabilities to customers.
In addition to maintaining our current information technology systems, Duke Energy believes the digital transformation of its business is key to driving internal efficiencies as well as providing additional capabilities to customers. Duke Energy’s information technology systems are critical to cost-effective, reliable daily operations and our ability to effectively serve our customers.
Duke Energy’s results of operations depend, in significant part, on the extent to which it can implement its business strategy successfully.
Duke Energy’s results of operations depend, in significant part, on the extent to which it can implement its business strategy and goals successfully. Duke Energy is working to meet growing and evolving customer energy needs while balancing customer reliability and affordability, and other priorities including the need to modernize its fleet and the regulatory construct.
Duke Energy Ohio’s and Duke Energy Indiana’s membership in an RTO presents risks that could have a material adverse effect on their results of operations, financial position and cash flows. The rules governing the various regional power markets may change, which could affect Duke Energy Ohio’s and Duke Energy Indiana’s costs and/or revenues.
The rules governing the various regional power markets may change, which could affect Duke Energy Ohio’s and Duke Energy Indiana’s costs and/or revenues.
Failure to comply with environmental regulations may result in the imposition of fines, penalties and injunctive measures affecting operating assets, as well as reputational damage. The steps the Duke Energy Registrants could be required to take to ensure their facilities are in compliance could be prohibitively expensive.
Compliance with environmental laws and regulations can require significant expenditures, including expenditures for cleanup costs and damages arising from contaminated properties. Failure to comply with environmental regulations may result in the imposition of fines, penalties and injunctive measures affecting operating assets, as well as reputational damage.
Fluctuations in commodity prices or availability may adversely affect various aspects of the Duke Energy Registrants’ operations as well as their results of operations, financial position and cash flows.
Deregulation or restructuring in the electric industry may result in increased competition and unrecovered costs that could adversely affect the Duke Energy Registrants’ results of operations, financial position or cash flows and their utility businesses.
Duke Energy has completed excavation of coal ash at the four high-priority North Carolina sites. At other sites, planning and closure methods have been studied and factored into the estimated retirement and management costs, and closure activities have commenced.
At all sites requiring CCR closure and groundwater remediation, closure methods and groundwater corrective action remedies have been studied and factored into the estimated retirement and management costs.
Although it is not expected that the costs to comply with current environmental regulations will have a material adverse effect on the Duke Energy Registrants’ results of operations, financial position and cash flows due to regulatory cost recovery, the Duke Energy Registrants are at risk that the costs of complying with environmental regulations in the future will have such an effect.
The costs to comply with environmental laws and regulations could have a material effect on the Duke Energy Registrants’ results of operations, financial position and cash flows. The EPA has issued or proposed federal regulations, including the new rules issued in April 2024, governing the management of wastewater, CCR management units and CO 2 emissions.
Removed
These regulations classify CCR as nonhazardous waste under the RCRA and apply to electric generating sites with new and existing landfills and, new and existing surface impoundments, and establish requirements regarding landfill design, structural integrity design and assessment criteria for surface impoundments, groundwater monitoring, protection and remedial procedures and other operational and reporting procedures for the disposal and management of CCR.
Added
For example, Duke Energy anticipates that its nuclear stations in North Carolina and South Carolina will continue to qualify for significant tax incentives in the form of nuclear production tax credits under the IRA.
Removed
Lee Steam Station site in South Carolina in connection with other legal requirements. Excavation at these sites involves movement of CCR materials to off-site locations for use as structural fill, to appropriately engineered off-site or on-site lined landfills or conversion of the ash for beneficial use.
Added
Nuclear energy is a reliable and clean energy source and nuclear tax incentives allowed under the IRA, including nuclear production tax credits, are expected to reduce the cost of the energy transition for our customers. If such nuclear production tax credits were eliminated or reduced, it could negatively impact our ability to return the anticipated cost benefits to customers.
Removed
Furthermore, the Duke Energy Registrants currently have EE riders in place to recover the cost of EE programs in North Carolina, South Carolina, Florida, Indiana, Ohio and Kentucky.
Added
Additionally, new EPA rules issued in April 2024 impose stringent GHG emission reduction standards, revised air toxic limits, and wastewater discharge limitations that may impact our carbon-reduction targets, and operational timeline and costs associated with certain new and existing generation.
Removed
LIQUIDITY, CAPITAL REQUIREMENTS AND COMMON STOCK RISKS The Duke Energy Registrants rely on access to short-term borrowings and longer-term debt and equity markets to finance their capital requirements and support their liquidity needs. Access to those markets can be adversely affected by a number of conditions, many of which are beyond the Duke Energy Registrants’ control.
Added
Changes to federal regulations are continuous and ongoing.
Removed
Poor investment performance of the Duke Energy pension plan holdings and other factors impacting pension plan costs could unfavorably impact the Duke Energy Registrants’ liquidity and results of operations.
Added
Such potential changes that may have adverse consequences could include no longer allowing tax incentives and credits currently provided for under the IRA, including the ability to record or sell related tax credits to third parties.
Added
For example, new EPA rules issued in April 2024, among other things, impose stringent GHG emissions limitations on existing coal plants and new natural gas plants and more stringent air toxic limits on existing coal plants, increase limitations on wastewater discharge, and impose groundwater monitoring and corrective action requirements on previously unregulated coal ash sources at regulated facilities (CCR Management Units) and inactive surface impoundments at retired generating facilities (Legacy CCR Surface Impoundments).
Added
Potential legal challenges to such rules may not be successful, and adherence to these rules may increase the cost of compliance, impact generation resource mix and carbon-reduction targets, and negatively impact customer reliability and affordability due to such rules' imposition of stringent GHG emissions limitations and reliance on carbon capture technologies that are not yet adequately demonstrated at utility scale.
Added
Such events can and in the past, have, negatively impacted sales volume such as in the case of storm-related customer outages resulting in lower usage, and costs to restore service and rebuild assets after such events may be, and in the case of hurricanes Helene and Milton experienced in 2024, have been, material and did impact the results of operations, financial position or cash flows of the Duke Energy Registrants, and such events may do so in the future, until complete and timely cost recovery is approved and occurs under existing relevant regulatory mechanisms across our jurisdictions.
Added
The regulation applies to all new and existing landfills, new and existing surface impoundments receiving CCR and existing surface impoundments located at stations generating electricity (regardless of fuel source), which were no longer receiving CCR but contained liquids as of the effective date of the rule.
Added
The rule establishes requirements regarding design and operating criteria, groundwater monitoring and corrective action, closure requirements and post-closure care, and recordkeeping, notifications, and internet posting requirements to ensure the safe disposal and management of CCR.
Added
The 2024 CCR Rule significantly expands the scope of the 2015 CCR Rule to apply to legacy CCR surface impoundments (inactive impoundments at retired facilities) and CCR management units (previously unregulated coal ash sources at regulated facilities).
Added
The Duke Energy Registrants’ operating results may fluctuate on a seasonal and quarterly basis and can be negatively affected by changes in weather conditions and severe weather, including extreme weather conditions and changes in weather patterns from climate change. Electric power generation and natural gas distribution are generally seasonal businesses.
Added
Access to capital markets may also be critical to finance unexpected material expenditures such as unusually volatile commodity costs or significant storm restoration activities for severe weather events.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAnother key component of Duke Energy’s first line of defense against cybersecurity threats is its Third-Party Risk Management (TPRM) process, whereby third parties providing services that meet certain criteria such as storing or transmitting Duke Energy data, hosting an application, or connecting to the Duke Energy network are required to undergo a cybersecurity assessment primarily to ascertain the risk of a third party’s proposed services to Duke Energy. 32 CYBERSECURITY Duke Energy’s second line of defense against cybersecurity threats is the EST, which is led by the CSISO, and actively evaluates, anticipates and tests Duke Energy’s cybersecurity risk level and preventive and risk mitigation controls relative to the enterprisewide risk level and controls.
Biggest changeAnother key component of Duke Energy’s first line of defense against cybersecurity threats is its Third-Party Risk Management (TPRM) process, whereby third parties providing services that meet certain criteria such as storing or transmitting Duke Energy data, hosting an application, or connecting to the Duke Energy network are required to undergo a cybersecurity assessment primarily to ascertain the risk of a third-party’s proposed services to Duke Energy.
Duke Energy manages cybersecurity threats through its 24/7 Duke Energy Cybersecurity Operations Center (CSOC), which serves as the Company’s central command center for monitoring and coordinating responses to cyberthreats. The CSOC engages in daily information sharing within the utilities industry and with government partners and monitors incoming intelligence and cyber incident impacts.
Duke Energy manages cybersecurity threats through its 24/7 Duke Energy Cybersecurity Operations Center (CSOC), which serves as the Company’s central command center for monitoring and coordinating responses to cyber-threats. The CSOC engages in daily information sharing within the utilities industry and with government partners and monitors incoming intelligence and cyber incident impacts.
The CSISO holds a Secret Security clearance and is committed to strengthening U.S. critical infrastructure through active collaboration with federal partners at the Federal Bureau of Investigation, Department of Energy, Department of Homeland Security, and state partners including the national guard, law enforcement and universities. • The CIO of Duke Energy has over 25 years of experience in delivering secure information technology solutions across multiple industries, leading technology delivery for all core business functions.
The CSISO holds a Secret Security clearance and is committed to strengthening U.S. critical infrastructure through active collaboration with federal partners at the Federal Bureau of Investigation, Department of Energy, Department of Homeland Security, and state partners including the national guard, law enforcement and universities. • The CAO of Duke Energy has over 25 years of experience in delivering secure information technology solutions across multiple industries, leading technology delivery for all core business functions.
The EST monitors cyber activity and also reports on the status of the Company’s cybersecurity performance and any ongoing remediation efforts to the Company’s Chief Information Officer (CIO) and CSISO.
The EST monitors cyber activity and also reports on the status of the Company’s cybersecurity performance and any ongoing remediation efforts to the Company’s CAO, Chief Information Officer (CIO) and CSISO.
The Audit Committee receives updates throughout the year from the CIO and CSISO on cybersecurity and grid security issues, including compliance with regulations, employee training, and drills, at every regularly scheduled Audit Committee meeting, and engages in discussions throughout the year with management on the effectiveness of Duke Energy’s overall cybersecurity program and progress for addressing any identified risks.
The Audit Committee receives updates throughout the year from the CAO and CSISO on cybersecurity and grid security issues, including compliance with regulations, employee training and drills, at every regularly scheduled Audit Committee meeting, and engages in discussions throughout the year with management on the effectiveness of Duke Energy’s overall cybersecurity program and progress for addressing any identified risks.
The CIO and CSISO report these cybersecurity metrics, which use a vulnerability management scoring system and closely align with the National Institute of Standards and Technology Cybersecurity Framework, to the Audit Committee at each regularly scheduled Audit Committee meeting.
The CAO and CSISO report these cybersecurity metrics, which use a vulnerability management scoring system and closely align with the National Institute of Standards and Technology Cybersecurity Framework, to the Audit Committee at each regularly scheduled Audit Committee meeting.
In light of the ever-evolving threat landscape and increasing sophistication of threat actor tactics, techniques and procedures, steadfast and sophisticated cybersecurity and security operations are integral parts of Duke Energy’s enterprise risk management framework.
In light of the ever-evolving threat landscape and increasing sophistication of threat actor tactics, techniques and procedures, steadfast and advanced cybersecurity and security operations are integral parts of Duke Energy’s enterprise risk management framework.
In this role, the CFO gained an in-depth understanding of the Company's cybersecurity procedures and key threats, and was responsible for the enterprise business services and technology team, including the information and technology organization. • The EVP, Chief Generation Officer and Enterprise Operational Excellence of Duke Energy has gained cybersecurity experience through being responsible for the safe, efficient and reliable operation of Duke Energy's fleet of nuclear, natural gas, hydro, solar and coal units. 33 CYBERSECURITY • The EVP, Customer Experience, Solutions and Services of Duke Energy has gained cybersecurity experience through focusing on transmission and the development of long-term grid strategies and solutions and through a prior role as Chief Distribution Officer, overseeing the safe, reliable, and efficient operation of Duke Energy’s electric distribution systems, and through serving on the board of the Association of Edison Illuminating Companies. • The EVP and Chief Commercial Officer of Duke Energy has cybersecurity experience gained through responsibility for enterprise technology and security, among other areas. • The CSISO of Duke Energy has over 25 years of experience building and leading security teams within multiple industries.
In this role, the CFO gained an in-depth understanding of the Company's cybersecurity procedures and key threats, and was responsible for the enterprise business services and technology team, including the information and technology organization. • The EVP, Chief Generation Officer and Enterprise Operational Excellence of Duke Energy has gained cybersecurity experience through being responsible for the safe, efficient and reliable operation of Duke Energy's fleet of nuclear, natural gas, hydro, solar and coal units. • The President of Duke Energy has gained cybersecurity experience through focusing on transmission and the development of long-term grid strategies and solutions and through a prior role as Chief Distribution Officer, overseeing the safe, reliable, and efficient operation of Duke Energy’s electric distribution systems, and through serving on the board of the Association of Edison Illuminating Companies. • The CSISO of Duke Energy has over 25 years of experience building and leading security teams within multiple industries.
In addition, the Company’s Executive Cybersecurity Oversight Governance Committee (ECOG), comprised of the Company's Chair, President, and Chief Executive Officer (CEO), Executive Vice President (EVP) and Chief Financial Officer, EVP and Chief Commercial Officer, EVP Customer Experience, Solutions and Services, and EVP, Chief Generation Officer and Enterprise Operational Excellence, receives monthly updates from the CIO and CSISO and provides senior management throughout the Company informational technology and operational technology perspectives, oversight and governance on investments and priorities for the broader cybersecurity organization, in addition to providing final decision oversight on recommendations and response to the ever challenging cybersecurity threat landscape.
The Company’s Executive Cybersecurity Oversight Governance Committee (ECOG), comprised of the Company's Chair and Chief Executive Officer (CEO), President, Executive Vice President (EVP) and Chief Financial Officer, and EVP, Chief Generation Officer and Enterprise Operational Excellence, receives monthly updates from the CAO and CSISO and provides senior management throughout the Company informational technology and operational technology perspectives, oversight and governance on investments and priorities for the broader cybersecurity organization, in addition to providing final decision oversight on recommendations and response to the ever-challenging cybersecurity threat landscape.
The CIO holds a Secret Security clearance and has active interactions and partnership with the Federal Bureau of Investigation, Edison Electric Institute and State Fusion Centers in the jurisdictions that Duke Energy serves. 34 PROPERTIES
The CAO holds a Secret Security clearance and has active interactions and partnership with the Federal Bureau of Investigation, Edison Electric Institute and State Fusion Centers in the jurisdictions that Duke Energy serves. 33 PROPERTIES
Duke Energy’s first line of defense is the CIRT under the Office of the Chief Information Officer.
Duke Energy’s first line of defense is the CIRT under the Office of the Chief Administrative Officer (CAO).
Duke Energy is not currently aware of any potential cybersecurity threats, including as a result of any previous cybersecurity incidents that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition, however, Duke Energy cannot provide assurance that it will not be materially affected in the future by cybersecurity risks or any future material incidents.
Duke Energy is not currently aware of any potential cybersecurity threats, including as a result of any previous cybersecurity incidents, that have materially affected or are reasonably likely to materially affect the Company, including its business strategy, results of operations or financial condition, however, Duke Energy cannot provide assurance that it will not be materially affected in the future by cybersecurity risks or any future material incidents. 32 CYBERSECURITY Governance The Audit Committee has primary oversight of management’s efforts to mitigate cybersecurity and technology risk and respond to cyber incidents.
In 2023, the Audit Committee received four updates on cybersecurity. The Audit Committee also receives periodic updates on Duke Energy’s digital transformation and the operation of, and enhancements to, the Company’s financial systems and business and operational technical systems.
In 2024, the Audit Committee received three updates and the full Board of Directors received one update on cybersecurity. The Audit Committee also receives periodic updates on Duke Energy’s digital transformation and the operation of, and enhancements to, the Company’s financial systems and business and operational technical systems.
The ECOG also is leveraged to supply information and bring transparency to senior management throughout the company on the increasing threat landscape and the actions, response and road map to combat the threats.
The ECOG also is leveraged to supply information and bring transparency to senior management throughout the Company on the increasing threat landscape and the actions, response and road map to combat the threats. Internal and external cybersecurity audits provide a third line of defense and independently provide assurance on how effectively the Company, as a whole, manages cybersecurity risk.
Removed
Internal and external cybersecurity audits provide a third line of defense and independently provide assurance on how effectively the Company, as a whole, manages cybersecurity risk.
Added
Duke Energy’s second line of defense against cybersecurity threats is the EST, which is led by the CSISO, and actively evaluates, anticipates and tests Duke Energy’s cybersecurity risk level and preventive and risk mitigation controls relative to the enterprisewide risk level and controls.
Removed
Governance The Audit Committee has primary oversight of management’s efforts to mitigate cybersecurity and technology risk and respond to cyber incidents.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeSutton CT Fossil Gas/Oil NC 97 Blewett CT Fossil Oil NC 68 Walters Hydro Water NC 112 Other small facilities (3 plants) Hydro Water NC 116 Distributed generation Renewable Solar NC 141 Asheville – Rock Hill Battery Renewable Storage NC 9 Hot Springs Microgrid Renewable Storage NC 6 Total Duke Energy Progress 13,770 Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Florida Hines CC Fossil Gas/Oil FL 2,149 Citrus County CC Fossil Gas FL 1,854 Crystal River Fossil Coal FL 1,442 Bartow CC Fossil Gas/Oil FL 1,259 Intercession City CT Fossil Gas/Oil FL 1,146 Anclote Fossil Gas FL 1,035 DeBary CT Fossil Gas/Oil FL 661 Osprey CC Fossil Gas/Oil FL 611 Tiger Bay CC Fossil Gas/Oil FL 230 Bayboro CT Fossil Oil FL 226 Bartow CT Fossil Gas/Oil FL 212 Suwannee River CT Fossil Gas FL 194 University of Florida CoGen CT Fossil Gas FL 50 Lake Placid Battery (microgrid) Renewable Storage FL 17 Trenton Battery Renewable Storage FL 11 Micanopy Battery Renewable Storage FL 8 Jennings Battery Renewable Storage FL 6 Cape San Blas Battery Renewable Storage FL 6 Distributed generation Renewable Solar FL 1,186 Total Duke Energy Florida 12,303 Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Ohio East Bend Fossil Coal KY 600 Woodsdale CT Fossil Gas/Propane OH 564 Distributed generation Renewable Solar KY 9 Total Duke Energy Ohio 1,173 36 PROPERTIES Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Indiana Gibson (c) Fossil Coal IN 2,845 Cayuga (d) Fossil Coal/Oil IN 1,015 Madison CT Fossil Gas OH 704 Edwardsport Fossil Coal/Gas IN 578 Wheatland CT Fossil Gas IN 508 Vermillion CT (e) Fossil Gas IN 477 Noblesville CC Fossil Gas/Oil IN 310 Henry County CT (f) Fossil Gas/Oil IN 134 Cayuga CT Fossil Gas/Oil IN 105 Purdue CHP Fossil Gas IN 16 Markland Hydro Water IN 54 Distributed generation Renewable Solar IN 29 Camp Atterbury Battery Renewable Storage IN 5 Nabb Battery Renewable Storage IN 5 Crane Battery Renewable Storage IN 5 Total Duke Energy Indiana 6,790 Owned MW Totals by Type Capacity Total Electric Utilities 54,772 Totals by Plant Type Nuclear 9,322 Fossil 40,107 Hydro 3,722 Renewable 1,621 Total Electric Utilities 54,772 (a) Jointly owned with North Carolina Municipal Power Agency Number 1, NCEMC and PMPA.
Biggest changeSutton CT Fossil Gas/Oil NC 97 Blewett CT Fossil Oil NC 68 Walters Hydro Water NC 112 Other small facilities (three plants) Hydro Water NC 116 Distributed generation Renewable Solar NC 146 Battery Storage Renewable Storage NC 45 Total Duke Energy Progress 13,845 34 PROPERTIES Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Florida Hines CC Fossil Gas/Oil FL 2,149 Citrus County CC Fossil Gas FL 1,854 Crystal River Fossil Coal FL 1,442 Bartow CC Fossil Gas/Oil FL 1,259 Intercession City CT Fossil Gas/Oil FL 1,146 Anclote Fossil Gas FL 1,025 DeBary CT Fossil Gas/Oil FL 661 Osprey CC Fossil Gas/Oil FL 611 Tiger Bay CC Fossil Gas/Oil FL 230 Bayboro CT Fossil Oil FL 193 Bartow CT Fossil Gas/Oil FL 212 Suwannee River CT Fossil Gas FL 194 University of Florida CoGen CT Fossil Gas FL 50 Distributed generation (19 sites) Renewable Solar FL 1,468 Battery Storage Renewable Storage FL 48 Total Duke Energy Florida 12,542 Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Ohio East Bend Fossil Coal KY 600 Woodsdale CT Fossil Gas/Propane OH 564 Distributed generation Renewable Solar KY 9 Total Duke Energy Ohio 1,173 Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Indiana Gibson (c) Fossil Coal IN 2,845 Cayuga (d) Fossil Coal/Oil IN 1,015 Madison CT Fossil Gas OH 704 Edwardsport Fossil Coal/Gas IN 578 Wheatland CT Fossil Gas IN 520 Vermillion CT (e) Fossil Gas IN 477 Noblesville CC Fossil Gas/Oil IN 310 Henry County CT (f) Fossil Gas/Oil IN 141 Cayuga CT Fossil Gas/Oil IN 110 Purdue CHP Fossil Gas IN 16 Markland Hydro Water IN 54 Distributed generation Renewable Solar IN 21 Battery Storage Renewable Storage IN 15 Total Duke Energy Indiana 6,806 35 PROPERTIES Owned MW Totals by Type Capacity Totals by Plant Type Nuclear 9,322 Fossil 40,104 Hydro 3,762 Renewable 1,951 Total Electric Utilities 55,139 (a) Jointly owned with North Carolina Municipal Power Agency Number 1, NCEMC and PMPA.
ITEM 2. PROPERTIES ELECTRIC UTILITIES AND INFRASTRUCTURE The following table provides information related to the EU&I's generation stations as of December 31, 2023. The MW displayed in the table below are based on winter capacity for Fossil, Nuclear and Hydro generation stations, and nameplate capacity for Renewable generation stations. Ownership interest in all facilities is 100% unless otherwise indicated.
ITEM 2. PROPERTIES ELECTRIC UTILITIES AND INFRASTRUCTURE The following table provides information related to the EU&I's generation stations as of December 31, 2024. The MW displayed in the table below are based on winter capacity for Fossil, Nuclear and Hydro generation stations, and nameplate capacity for Renewable generation stations. Ownership interest in all facilities is 100% unless otherwise indicated.
Lee CC Fossil Gas/Oil NC 1,054 Wayne County CT Fossil Gas/Oil NC 975 Smith CT Fossil Gas/Oil NC 960 L.V. Sutton CC Fossil Gas/Oil NC 719 Mayo Fossil Coal NC 713 Asheville CC Fossil Gas/Oil NC 560 Asheville CT Fossil Gas/Oil NC 370 Darlington CT Fossil Gas/Oil SC 264 Weatherspoon CT Fossil Gas/Oil NC 164 L.V.
Lee CC Fossil Gas/Oil NC 1,054 Smith CT Fossil Gas/Oil NC 1,000 Wayne County CT Fossil Gas/Oil NC 975 L.V. Sutton CC Fossil Gas/Oil NC 719 Mayo Fossil Coal NC 713 Asheville CC Fossil Gas/Oil NC 560 Asheville CT Fossil Gas/Oil NC 370 Darlington CT Fossil Gas/Oil SC 264 Weatherspoon CT Fossil Gas/Oil NC 164 L.V.
(d) Includes Cayuga Internal Combustion. (e) Jointly owned with WVPA. Duke Energy Indiana's ownership is 62.5% of the facility. (f) Includes 50 MW, which are contracted to WVPA. The following table provides information related to EU&I's electric transmission and distribution properties as of December 31, 2023.
(d) Includes Cayuga Internal Combustion. (e) Jointly owned with WVPA. Duke Energy Indiana's ownership is 62.5% of the facility. (f) Includes 50 MW contracted to WVPA. The following table provides information related to EU&I's electric transmission and distribution properties as of December 31, 2024.
Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Carolinas Oconee Nuclear Uranium SC 2,618 McGuire Nuclear Uranium NC 2,386 Catawba (a) Nuclear Uranium SC 588 Belews Creek Fossil Coal/Gas NC 2,220 Marshall Fossil Coal/Gas NC 2,078 Lincoln Combustion Turbine (CT) Fossil Gas/Oil NC 1,507 J.E.
Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Carolinas Oconee Nuclear Uranium SC 2,618 McGuire Nuclear Uranium NC 2,386 Catawba (a) Nuclear Uranium SC 588 Belews Creek Fossil Coal/Gas NC 2,220 Marshall Fossil Coal/Gas NC 2,078 Lincoln CT Fossil Gas/Oil NC 1,909 J.E.
The following table provides information related to GU&I's natural gas distribution as of December 31, 2023.
The following table provides information related to GU&I's natural gas distribution as of December 31, 2024.
Rogers Fossil Coal/Gas NC 1,395 Rockingham CT Fossil Gas/Oil NC 895 Mill Creek CT Fossil Gas/Oil SC 751 Buck CC Fossil Gas NC 718 Dan River CC Fossil Gas NC 718 W.S. Lee Combined Cycle (CC) (b) Fossil Gas SC 706 Allen Fossil Coal NC 426 W.S.
Rogers Fossil Coal/Gas NC 1,395 Rockingham CT Fossil Gas/Oil NC 895 Mill Creek CT Fossil Gas/Oil SC 751 Buck CC Fossil Gas NC 718 Dan River CC Fossil Gas NC 718 W.S. Lee CC (b) Fossil Gas SC 706 W.S.
Lee CT Fossil Gas/Oil SC 96 Clemson CHP Fossil Gas SC 16 Bad Creek Hydro Water SC 1,600 Jocassee Hydro Water SC 780 Cowans Ford Hydro Water NC 324 Keowee Hydro Water SC 152 Other small facilities (18 plants) Hydro Water NC/SC 584 Distributed generation Renewable Solar NC 178 Total Duke Energy Carolinas 20,736 35 PROPERTIES Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Progress Brunswick Nuclear Uranium NC 1,928 Harris Nuclear Uranium NC 1,009 Robinson Nuclear Uranium SC 793 Roxboro Fossil Coal NC 2,462 Smith CC Fossil Gas/Oil NC 1,250 H.F.
Lee CT Fossil Gas/Oil SC 96 Clemson CHP Fossil Gas SC 16 Bad Creek Hydro Water SC 1,640 Jocassee Hydro Water SC 780 Cowans Ford Hydro Water NC 324 Keowee Hydro Water SC 152 Other small facilities (18 plants) Hydro Water NC/SC 584 Distributed generation Renewable Solar NC 174 Battery Storage Renewable Storage NC 25 Total Duke Energy Carolinas 20,773 Owned MW Facility Plant Type Primary Fuel Location Capacity Duke Energy Progress Brunswick Nuclear Uranium NC 1,928 Harris Nuclear Uranium NC 1,009 Robinson Nuclear Uranium SC 793 Roxboro Fossil Coal NC 2,462 Smith CC Fossil Gas/Oil NC 1,250 H.F.
Duke Duke Energy Energy Ohio Piedmont Miles of natural gas distribution and transmission pipelines 35,700 7,700 28,000 Miles of natural gas service lines 28,800 6,700 22,100 OTHER Duke Energy owns approximately 7.1 million square feet and leases approximately 2.5 million square feet of corporate, regional and district office space spread throughout its service territories.
Duke Duke Energy Energy Ohio Piedmont Miles of natural gas distribution and transmission pipelines 36,300 7,600 28,700 Miles of natural gas service lines 29,700 6,800 22,900 OTHER Duke Energy owns approximately 7.2 million square feet and leases approximately 2 million square feet of corporate, regional and district office space spread throughout its service territories.
See Note 11, "Property, Plant and Equipment," for further information.
See Note 11, "Property, Plant and Equipment," for further information. 36 LEGAL PROCEEDINGS AND MINE SAFETY DISCLOSURES
Duke Duke Duke Duke Duke Duke Energy Energy Energy Energy Energy Energy Carolinas Progress Florida Ohio Indiana Electric Transmission Lines Miles of 500 to 525 kilovolt (kV) 1,100 600 300 200 — — Miles of 345 kV 1,100 — — — 400 700 Miles of 230 kV 8,500 2,700 3,400 1,700 — 700 Miles of 100 to 161 kV 12,600 6,900 2,600 1,000 700 1,400 Miles of 13 to 69 kV 8,100 2,800 — 2,200 600 2,500 Total conductor miles of electric transmission lines 31,400 13,000 6,300 5,100 1,700 5,300 Electric Distribution Lines Miles of overhead lines 171,100 66,600 44,300 25,000 13,300 21,900 Miles of underground line 111,800 43,600 28,900 22,900 6,500 9,900 Total conductor miles of electric distribution lines 282,900 110,200 73,200 47,900 19,800 31,800 Number of electric transmission and distribution substations 3,000 1,200 500 500 300 500 Substantially all of EU&I's 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. 37 PROPERTIES GAS UTILITIES AND INFRASTRUCTURE GU&I owns transmission pipelines and distribution mains that are generally underground, located near public streets and highways, or on property owned by others for which Duke Energy Ohio and Piedmont have obtained the necessary legal rights to place and operate facilities on such property located within the GU&I service territories.
Duke Duke Duke Duke Duke Duke Energy Energy Energy Energy Energy Energy Carolinas Progress Florida Ohio Indiana Electric Transmission Lines Miles of 500 to 525 kilovolt (kV) 1,100 600 300 200 — — Miles of 345 kV 1,100 — — — 400 700 Miles of 230 kV 8,600 2,700 3,400 1,800 — 700 Miles of 100 to 161 kV 12,700 6,900 2,600 1,100 700 1,400 Miles of 13 to 69 kV 8,200 2,800 — 2,300 600 2,500 Total conductor miles of electric transmission lines 31,700 13,000 6,300 5,400 1,700 5,300 Electric Distribution Lines Miles of overhead lines 171,700 66,700 44,500 25,100 13,300 22,100 Miles of underground line 114,900 44,500 30,100 23,600 6,600 10,100 Total conductor miles of electric distribution lines 286,600 111,200 74,600 48,700 19,900 32,200 Number of electric transmission and distribution substations 3,000 1,200 500 500 300 500 Substantially all of EU&I's 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.
Removed
Prior to December 31, 2023, summer capacity was displayed for all EU&I generation stations in the table below.
Added
GAS UTILITIES AND INFRASTRUCTURE GU&I owns transmission pipelines and distribution mains that are generally underground, located near public streets and highways, or on property owned by others for which Duke Energy Ohio and Piedmont have obtained the necessary legal rights to place and operate facilities on such property located within the GU&I service territories.
Removed
Certain registrants' IRPs, including those filed in North Carolina and South Carolina in 2023, currently use winter capacity for Fossil, Nuclear and Hydro stations as winter capacity is generally a more accurate representation of that stations' ability to support peak capacity requirements due to a higher risk of reliability challenges during the winter months in those jurisdictions.
Removed
Additionally, analysis of resource adequacy across all jurisdictions demonstrates that as solar adoption increases, there is a higher risk of reliability challenges in the winter. As such, most of Duke Energy's IRPs are expected to shift toward winter planning. See Item 7, "Other Matters" for additional information on IRPs.
Removed
Nameplate capacity is generally viewed as a transparent representation of the Renewable stations since their output varies by day, month, and real-time weather conditions, particularly with solar facilities, which may or may not be paired with battery storage depending on the location.
Removed
The Owned MW Capacity based on summer capacity as of December 31, 2023, is 50,302 MW for all of EU&I.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeDuke Energy cannot predict the outcome of this matter. In addition, the Duke Energy Registrants are, from time to time, parties to various lawsuits and regulatory proceedings in the ordinary course of their business. For information regarding legal proceedings, including regulatory and environmental matters, see Note 4, “Regulatory Matters,” and Note 5, “Commitments and Contingencies,” to the Consolidated Financial Statements.
Biggest changeSee Note 4, “Regulatory Matters,” and Note 5, “Commitments and Contingencies,” to the Consolidated Financial Statements, which information is incorporated herein by reference, for discussion of certain legal, environmental and other regulatory proceedings to which the Duke Energy Registrants are a party.
ITEM 3. LEGAL PROCEEDINGS MTBE Litigation On December 15, 2017, the state of Maryland filed suit in Baltimore City Circuit Court against Duke Energy Merchants and other defendants alleging contamination of state waters by MTBE leaking from gasoline storage tanks and is seeking an unspecified amount of monetary damages.
ITEM 3. LEGAL PROCEEDINGS MTBE Litigation In December 2017, the state of Maryland filed suit in Baltimore City Circuit Court against Duke Energy Merchants and other defendants alleging contamination of state waters by MTBE leaking from gasoline storage tanks and is seeking an unspecified amount of monetary damages.
MTBE is a gasoline additive intended to increase the oxygen levels in gasoline and make it burn cleaner. The case was removed from Baltimore City Circuit Court to federal District Court. Initial motions to dismiss filed by the defendants were denied by the court on September 4, 2019, and the matter is now in discovery.
MTBE is a gasoline additive intended to increase the oxygen levels in gasoline and make it burn cleaner. The case was removed from Baltimore City Circuit Court to federal District Court. Initial motions to dismiss filed by the defendants were denied by the court in September 2019, and the matter is now in discovery.
On December 18, 2020, the plaintiff and defendants selected 50 focus sites, none of which have any ties to Duke Energy Merchants. Discovery will be specific to those sites. At this time, Duke Energy Merchants has not engaged in settlement negotiations with the plaintiff and the plaintiff has not reached a settlement agreement with any defendant.
In December 2020, the plaintiff and defendants selected 50 focus sites, none of which have any ties to Duke Energy Merchants. Discovery will be specific to those sites. At this time, Duke Energy Merchants has not engaged in settlement negotiations with the plaintiff and the plaintiff has not reached a settlement agreement with any defendant.
Added
Duke Energy cannot predict the outcome of this matter.
Added
The Town of Carrboro Litigation On December 4, 2024, the town of Carrboro, North Carolina, filed a lawsuit against Duke Energy in the North Carolina Superior Court, Orange County, alleging that Duke Energy and its predecessor companies knew since the late 1960s that fossil-fuel emissions could cause global climate changes and engaged in a campaign to conceal the dangers of fossil fuel emissions from the public, regulators, legislators, and others, resulting in a delayed transition away from fossil fuel emissions and worsening climate change.
Added
The lawsuit also alleges that Duke Energy misled the public regarding Duke Energy’s support for, and actions toward, transitioning its fossil fuel portfolio to renewable energy. The damages alleged range from road and stormwater-system impacts to increased electricity costs and recurring invasions and interferences from extreme weather events.
Added
The lawsuit asserts state-law claims for public nuisance, private nuisance, trespass, negligence, and gross negligence, and is seeking an unspecified amount of monetary damages. The case has been transferred to the North Carolina Business Court. Duke Energy cannot predict the outcome of this matter.
Added
In addition, from time to time, the Duke Energy Registrants are parties to various legal, environmental or other regulatory proceedings, including in the ordinary course of business.
Added
SEC regulations require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and such proceedings involve potential monetary sanctions that the Duke Energy Registrants reasonably believe will exceed a specified threshold. Pursuant to the SEC regulations, the Duke Energy Registrants use a threshold of $1 million for such proceedings.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities for Fourth Quarter 2023 T here were no repurchases of e quity securities during the fourth quarter of 2023. Unregistered Sales of Equity Securities and Use of Proceeds None.
Biggest changeIssuer Purchases of Equity Securities for Fourth Quarter 2024 T here were no repurchases of e quity securities during the fourth quarter of 2024. Unregistered Sales of Equity Securities and Use of Proceeds None.
The graph assumes an initial investment of $100 on December 31, 2018, in Duke Energy common stock, in the S&P 500 and in the Philadelphia Utility Index and that all dividends were reinvested. The stockholder return shown below for the five-year historical period may not be indicative of future performance.
The graph assumes an initial investment of $100 on December 31, 2019, in Duke Energy common stock, in the S&P 500 and in the Philadelphia Utility Index and that all dividends were reinvested. The stockholder return shown below for the five-year historical period may not be indicative of future performance.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES The common stock of Duke Energy is listed and traded on the NYSE (ticker symbol DUK). As of January 31, 2024, there w ere 121,476 Duke Energy common stockholders of record.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES The common stock of Duke Energy is listed and traded on the NYSE (ticker symbol DUK). As of January 31, 2025, there w ere 114,684 Duke Energy common stockholders of record.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe variance was driven primarily by: • a $363 million increase in storm revenues at Duke Energy Florida due to hurricanes Ian and Nicole collections; • a $254 million increase in fuel cost recovery from retail customers at Duke Energy Florida, partially offset by a decrease at Duke Energy Progress driven by lower JDA sales volumes at lower prices in the current year, partially offset by higher fuel cost recovery; • a $144 million increase due to higher pricing from the North Carolina and the South Carolina rate cases at Duke Energy Progress, and retail pricing due to base rate adjustments related to annual increases from the 2021 Settlement Agreement at Duke Energy Florida; • a $66 million increase in rider revenues at Duke Energy Florida primarily due to increased Storm Protection Plan rider and a decrease in the return of EDIT to customers compared to the prior year at Duke Energy Progress; and • a $23 million increase in franchise tax revenue primarily due to increased revenues over prior year at Duke Energy Florida. 51 MD&A PROGRESS ENERGY Partially offset by: • a $274 million decrease in wholesale revenues net of fuel due to decreased demand at Duke Energy Florida, partially offset by higher capacity rates net of lower volumes at Duke Energy Progress; • a $99 million decrease in weather-normal retail sales volumes at Duke Energy Progress and Duke Energy Florida; and • a $74 million decrease in retail sales due to unfavorable weather compared to prior year at Duke Energy Progress, partially offset by favorable weather in the current year at Duke Energy Florida.
Biggest changeThe variance was driven primarily by: • a $198 million increase due to higher pricing from the North Carolina and South Carolina rate cases at Duke Energy Progress and the 2021 Settlement at Duke Energy Florida; • a $111 million increase in weather-normal retail sales volumes at Duke Energy Progress; • a $95 million increase in retail sales due to improved weather compared to prior year, including the impacts of decoupling, at D uke Energy Progress and Duke Energy Florida; • a $92 million increase in higher transmission revenues, higher Clean Energy Connection subscription revenues and higher residential fixed bill program revenues at Duke Energy Florida; and • a $56 million increase in rider revenues primarily due to higher rates for the SPP, Energy Conservation Cost Recovery and Environmental Cost Recovery at Duke Energy Florida.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
The below percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
Duke Energy plans to adjust to and incorporate evolving and innovative technologies in a way that balances the reliability and affordability of energy while meeting regulatory requirements and customer demands. Under any future scenario involving mandatory CO 2 limitations, the Duke Energy Registrants would plan to seek recovery of their compliance costs through appropriate regulatory mechanisms.
Duke Energy plans to adjust to and incorporate these evolving and innovative technologies in a way that balances the reliability and affordability of energy while meeting regulatory requirements and customer demands. Under any future scenario involving mandatory CO 2 limitations, the Duke Energy Registrants would plan to seek recovery of their compliance costs through appropriate regulatory mechanisms.
For more information on storm securitization and storm cost recovery, see Note 4 to the Consolidated Financial Statements, "Regulatory Matters." The Duke Energy Registrants routinely take steps to reduce the potential impact of severe weather events on their electric transmission and distribution systems and natural gas facilities.
For more information on storm securitization and storm cost recovery, see Note 4 to the Consolidated Financial Statements, "Regulatory Matters." The Duke Energy Registrants routinely take steps to assess and reduce the potential impact of severe weather events on their electric transmission and distribution systems and natural gas facilities.
Moody's S&P Duke Energy Corporation Stable Stable Issuer Credit Rating Baa2 BBB+ Senior Unsecured Debt Baa2 BBB Junior Subordinated Debt/Preferred Stock Baa3 BBB- Commercial Paper P-2 A-2 Duke Energy Carolinas Stable Stable Senior Secured Debt Aa3 A Senior Unsecured Debt A2 BBB+ Progress Energy Stable Stable Senior Unsecured Debt Baa1 BBB Duke Energy Progress Stable Stable Senior Secured Debt Aa3 A Duke Energy Florida Stable Stable Senior Secured Debt A1 A Senior Unsecured Debt A3 BBB+ Duke Energy Ohio Stable Stable Senior Secured Debt A2 A Senior Unsecured Debt Baa1 BBB+ Duke Energy Indiana Stable Stable Senior Secured Debt Aa3 A Senior Unsecured Debt A2 BBB+ Duke Energy Kentucky Negative Stable Senior Unsecured Debt Baa1 BBB+ Piedmont Natural Gas Stable Stable Senior Unsecured A3 BBB+ Credit ratings are intended to provide credit lenders a framework for comparing the credit quality of securities and are not a recommendation to buy, sell or hold.
Moody's S&P Duke Energy Corporation Stable Stable Issuer Credit Rating Baa2 BBB+ Senior Unsecured Debt Baa2 BBB Junior Subordinated Debt/Preferred Stock Baa3/Ba1 BBB- Commercial Paper P-2 A-2 Duke Energy Carolinas Stable Stable Senior Secured Debt Aa3 A Senior Unsecured Debt A2 BBB+ Progress Energy Stable Stable Senior Unsecured Debt Baa1 BBB Duke Energy Progress Stable Stable Senior Secured Debt Aa3 A Duke Energy Florida Stable Stable Senior Secured Debt A1 A Senior Unsecured Debt A3 BBB+ Duke Energy Ohio Stable Stable Senior Secured Debt A2 A Senior Unsecured Debt Baa1 BBB+ Duke Energy Indiana Stable Stable Senior Secured Debt Aa3 A Senior Unsecured Debt A2 BBB+ Duke Energy Kentucky Stable Stable Senior Unsecured Debt Baa1 BBB+ Piedmont Natural Gas Stable Stable Senior Unsecured A3 BBB+ Credit ratings are intended to provide credit lenders a framework for comparing the credit quality of securities and are not a recommendation to buy, sell or hold.
For contracts qualifying for the NPNS exception, no recognition of the contract’s fair value in the Consolidated Financial Statements is required until settlement of the contract as long as the transaction remains probable of occurring. 65 MD&A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Risk Duke Energy is exposed to risk resulting from changes in interest rates as a result of its issuance or anticipated issuance of variable and fixed-rate debt and commercial paper.
For contracts qualifying for the NPNS exception, no recognition of the contract’s fair value in the Consolidated Financial Statements is required until settlement of the contract as long as the transaction remains probable of occurring. 64 MD&A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Interest Rate Risk Duke Energy is exposed to risk resulting from changes in interest rates as a result of its issuance or anticipated issuance of variable and fixed-rate debt and commercial paper.
In certain in stances, Duke Energy may utilize instruments other than senior notes, including equity-content securities such as subordinated debt or preferred stock. Proceeds will primarily be for the purpose of funding capital expenditures and debt maturities. See to Note 7 to the Consolidated Financial Statements, "Debt and Credit Facilities," for further information regarding significant debt issuances.
In certain instances, Duke Energy may utilize instruments other than senior notes, including equity-content securities such as subordinated debt or preferred stock. Proceeds will primarily be for the purpose of funding capital expenditures and debt maturities. See Note 7 to the Consolidated Financial Statements, "Debt and Credit Facilities," for further information regarding significant debt issuances.
Cost recovery for future expenditures will be pursued through the normal ratemaking process with federal 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 Notes 4 and 10 to the Consolidated Financial Statements, "Regulatory Matters" and "Asset Retirement Obligations," respectively.
Cost recovery for future expenditures will be pursued through the normal ratemaking process with federal and state utility commissions and via wholesale contracts, which permit recovery of reasonable and prudently incurred costs associated with Duke Energy’s regulated operations. For more information, see Notes 4 and 10 to the Consolidated Financial Statements, "Regulatory Matters" and "Asset Retirement Obligations," respectively.
In 2021, the state of North Carolina passed HB 951, which among other things, directed the NCUC to develop and approve a carbon reduction plan by the end of 2022 that would target a 70% reduction in CO 2 emissions from Duke Energy Progress' and Duke Energy Carolinas' electric generation in the state by 2030 and carbon neutrality by 2050, considering all resource options and the latest technology.
In 2021, the state of North Carolina passed HB 951, which among other things, directed the NCUC to develop and approve a carbon reduction plan that would target a 70% reduction in CO 2 emissions from Duke Energy Progress' and Duke Energy Carolinas' electric generation in the state by 2030 and carbon neutrality by 2050, considering all resource options and the latest technology.
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 2023 impairment tests, Duke Energy considered implied WACCs for certain peer companies in determining the appropriate WACC rates to use in its analysis.
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 2024 impairment tests, Duke Energy considered implied WACCs for certain peer companies in determining the appropriate WACC rates to use in its analysis.
However, none of the registrants make any representation as to information related solely to Duke Energy or the subsidiary registrants of Duke Energy other than itself. Management’s Discussion and Analysis should be read in conjunction with the Consolidated Financial Statements and Notes for the years ended December 31, 2023, 2022 and 2021. See "Item 7.
However, none of the registrants make any representation as to information related solely to Duke Energy or the subsidiary registrants of Duke Energy other than itself. Management’s Discussion and Analysis should be read in conjunction with the Consolidated Financial Statements and Notes for the years ended December 31, 2024, 2023 and 2022. See "Item 7.
For further information, see Note 4 to the Consolidated Financial Statements, "Regulatory Matters." Goodwill Impairment Assessments Duke Energy performed its annual goodwill impairment tests for all reporting units as of August 31, 2023. Additionally, Duke Energy monitors all relevant events and circumstances during the year to determine if an interim impairment test is required.
For further information, see Note 4 to the Consolidated Financial Statements, "Regulatory Matters." Goodwill Impairment Assessments Duke Energy performed its annual goodwill impairment tests for all reporting units as of August 31, 2024. Additionally, Duke Energy monitors all relevant events and circumstances during the year to determine if an interim impairment test is required.
On December 31, 2019, Duke Energy Carolinas and Duke Energy Progress entered into a settlement agreement with NCDEQ and certain community groups under which Duke Energy Carolinas and Duke Energy Progress agreed to excavate six of the nine remaining coal ash basins at these sites with ash moved to on-site lined landfills, including two at Allen, one at Mayo, one at Roxboro, and two at Rogers.
On December 31, 2019, Duke Energy Carolinas and Duke Energy Progress entered into a settlement agreement with NCDEQ and certain community groups under which Duke Energy Carolinas and Duke Energy Progress agreed to excavate six of the nine remaining coal ash basins with ash moved to on-site lined landfills, including two at Allen, one at Mayo, one at Roxboro, and two at Rogers.
See Note 7 to the Consolidated Financial Statements, “Debt and Credit Facilities,” for information regarding the Duke Energy Registrants' long-term debt at December 31, 2023, the weighted average interest rate applicable to each long-term debt category and a schedule of long-term debt maturities over the next five years.
See Note 7 to the Consolidated Financial Statements, “Debt and Credit Facilities,” for information regarding the Duke Energy Registrants' long-term debt at December 31, 2024, the weighted average interest rate applicable to each long-term debt category and a schedule of long-term debt maturities over the next five years.
The Duke Energy Registrants were in compliance with all other covenants related to their debt agreements as of December 31, 2023. I n addition, some credit agreements may allow for acceleration of payments or termination of the agreements due to nonpayment, or acceleration of other significant indebtedness of the borrower or some of its subsidiaries.
The Duke Energy Registrants were in compliance with all other covenants related to their debt agreements as of December 31, 2024. I n addition, some credit agreements may allow for acceleration of payments or termination of the agreements due to nonpayment, or acceleration of other significant indebtedness of the borrower or some of its subsidiaries.
Nuclear Decommissioning Trust Funds As required by the NRC, NCUC, PSCSC and FPSC, subsidiaries of Duke Energy maintain trust funds to fund the costs of nuclear decommissioning. As of December 31, 2023, these funds were invested primarily in domestic and international equity securities, debt securities, cash and cash equivalents and short-term investments.
Nuclear Decommissioning Trust Funds As required by the NRC, NCUC, PSCSC and FPSC, subsidiaries of Duke Energy maintain trust funds to fund the costs of nuclear decommissioning. As of December 31, 2024, these funds were invested primarily in domestic and international equity securities, debt securities, cash and cash equivalents and short-term investments.
Such events and circumstances include an adverse regulatory outcome, declining financial performance and deterioration of industry or market conditions. As of August 31, 2023, all of the reporting units' estimated fair value of equity exceeded the carrying value of equity.
Such events and circumstances include an adverse regulatory outcome, declining financial performance and deterioration of industry or market conditions. As of August 31, 2024, all of the reporting units' estimated fair value of equity exceeded the carrying value of equity.
In November 2023, Duke Energy Carolinas and Duke Energy Progress provided notice to the NCUC and PSCSC of a substantially increased load forecast resulting from increased economic development in the Carolinas occurring since the system-wide Plan was prepared.
In November 2023, Duke Energy Carolinas and Duke Energy Progress provided notice to the NCUC and PSCSC of a substantially increased load forecast resulting from increased economic development in the Carolinas occurring since the Plan was prepared.
Duke Energy’s capital requirements arise primarily from capital and investment expenditures, repaying long-term debt and paying dividends to shareholders. Additionally, due to its existing tax attributes and projected tax credits to be generated relating to the IRA, Duke Energy does not expect to be a significant federal cash taxpa yer until around 2030.
Duke Energy’s capital requirements arise primarily from capital and investment expenditures, repaying long-term debt and paying dividends to shareholders. Additionally, due to its existing tax attributes and projected tax credits to be generated relating to the IRA, Duke Energy does not expect to be a significant federal cash taxpayer until around 2030.
At December 31, 2023, the amount of restricted net assets of subsidiaries of Duke Energy that may not be distributed to Duke Energy in the form of a loan or dividend does not exceed a material amount of Duke Energy’s net assets .
At December 31, 2024, the amount of restricted net assets of subsidiaries of Duke Energy that may not be distributed to Duke Energy in the form of a loan or dividend does not exceed a material amount of Duke Energy’s net assets .
The discount rates used for calculating the fair values as of August 31, 2023, for each of Duke Energy’s reporting units ranged from 6.3% to 6.6%. The underlying assumptions and estimates are made as of a point in time.
The discount rates used for calculating the fair values as of August 31, 2024, for each of Duke Energy’s reporting units ranged from 6.3% to 6.5%. The underlying assumptions and estimates are made as of a point in time.
Estimated future cash flows under the income approach were based on Duke Energy's forecast, which was informed by existing power purchase agreements with offtakers and forward merchant curves. Significant assumptions used in the income approach include forward merchant curves and discount rates. The discount rates take into account both the after-tax cost of debt and cost of equity.
Estimated future cash flows under the income approach were based on Duke Energy's forecast, which was informed by existing power purchase agreements with offtakers and forward merchant curves. Significant assumptions used in the income approach include forward merchant curves and discount rates. The discount rates considered both the after-tax cost of debt and cost of equity.
Goodwill The Duke Energy Registrants performed their annual goodwill impairment tests as of August 31, 2023, as described in Note 12 to the Consolidated Financial Statements, "Goodwill and Intangible Assets." As of August 31, 2023, all of Duke Energy Registrants' reporting units' estimated fair values materially exceeded the carrying values except for the GU&I reporting unit of Duke Energy Ohio.
Goodwill The Duke Energy Registrants performed their annual goodwill impairment tests as of August 31, 2024, as described in Note 12 to the Consolidated Financial Statements, "Goodwill and Intangible Assets." As of this date, all of the Duke Energy Registrants' reporting units' estimated fair values materially exceeded the carrying values except for the GU&I reporting unit of Duke Energy Ohio.
Duke Energy also has made investments to increase EE offerings and ensure continued operations of its zero-CO 2 emissions hydropower and nuclear plants. These efforts have diversified its system and significantly reduced CO 2 emissions.
Duke Energy also has made investments to increase EE offerings and ensure continued operations of its zero-CO 2 emissions hydropower and nuclear plants. These efforts have diversified our electric generating system and significantly reduced CO 2 emissions.
At this time, such impacts are not able to be quantified; however, the net-zero methane goals announced in 2020 for the natural gas distribution business, as well as the actions taken to reduce these GHG emissions, potentially lowers the exposure to any future mandatory GHG emission reduction requirements.
At this time, such impacts are not able to be quantified; however, our net-zero methane goals for the natural gas distribution business, as well as the actions taken to reduce these GHG emissions, potentially lowers the exposure to any future mandatory GHG emission reduction requirements.
The estimated total cost to permanently close all coal ash basins in North Carolina and South Carolina is estimated to be approximately $7 billion to $8 billion of which approximately $4 billion has been spent through 2023. The majority of the remaining spend is primarily expected to occur over the next 10 years.
The estimated total cost to permanently close all coal ash basins in North Carolina and South Carolina is estimated to be approximately $8 billion to $9 billion of which approximately $4.4 billion has been spent through 2024. The majority of the remaining spend is primarily expected to occur over the next 10 years.
EPA has also proposed regulations that would require reduction of methane emissions upstream of the Duke Energy Registrants' natural gas distribution business. The impact of these regulations on natural gas fuel prices is not currently quantifiable.
EPA has issued regulations that would require reduction of methane emissions upstream of the Duke Energy Registrants' natural gas distribution business. The impact of these regulations on natural gas fuel prices is not currently quantifiable.
Management's Discussion and Analysis of Financial Condition and Results of Operations," in Duke Energy's Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 27, 2023, for a discussion of variance drivers for the year ended December 31, 2022, as compared to December 31, 2021.
Management's Discussion and Analysis of Financial Condition and Results of Operations," in Duke Energy's Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 23, 2024, for a discussion of variance drivers for the year ended December 31, 2023, as compared to December 31, 2022.
Future levels of GHG emissions by the Duke Energy Registrants will be influenced by variables that include customer growth and capacity needs in the jurisdictions in which they operate, public policy, tax incentives, economic conditions that affect electricity demand, fuel prices, market prices, availability of resources and labor, compliance with new or existing regulations, the ability to make enhancements to transmission and distribution systems to support increased renewables, and the existence of new technologies that can be deployed to generate the electricity necessary to meet customer demand.
Future levels of CO 2 emissions by the Duke Energy Registrants will be influenced by variables that include customer growth and capacity needs in the jurisdictions in which they operate, public policy, tax incentives, economic conditions that affect electricity demand, weather conditions, fuel prices, market prices, availability of resources and labor, compliance with new or existing regulations, the ability to make enhancements to transmission and distribution systems to support increased deployment of renewables and behind-the-meter technologies and the existence of new technologies that can be deployed to generate the electricity necessary to meet customer demand.
The impact of a 100-basis point change in interest rates on pretax income is approximately $80 million at December 31, 2023. This amount was estimated by considering the impact of the hypothetical interest rates on variable-rate securities outstanding, adjusted for interest rate hedges as of December 31, 2023.
The impact of a 100-basis point change in interest rates on pretax income is approximately $70 million at December 31, 2024. This amount was estimated by considering the impact of the hypothetical interest rates on variable-rate securities outstanding, adjusted for interest rate hedges as of December 31, 2024.
Other Duke Energy continues to monitor general market conditions, including the potential for continued interest rate pressures on the Company's cost of capital, which may impact Duke Energy's execution of its capital plan, future financial results, or the achievement of its clean energy goals. 44 MD&A DUKE ENERGY Results of Operations Non-GAAP Measures Management evaluates financial performance in part based on non-GAAP financial measures, including adjusted earnings and adjusted EPS.
Other Duke Energy continues to monitor general market conditions, including the potential for interest rate pressures on the Company's cost of capital, which may impact Duke Energy's execution of its capital plan, future financial results, or the achievement of its energy transition. 43 MD&A DUKE ENERGY Results of Operations Non-GAAP Measures Management evaluates financial performance in part based on non-GAAP financial measures, including adjusted earnings and adjusted EPS.
The implied market multiples used for calculating the fair values as of August 31, 2023, for each of Duke Energy's reporting units ranged from 9.3 to 11.2. Duke Energy primarily operates in environments that are rate-regulated. In such environments, revenue requirements are adjusted periodically by regulators based on factors including levels of costs, sales volumes and costs of capital.
The implied market multiples used for calculating the fair values as of August 31, 2024, for each of Duke Energy's reporting units ranged from 9.1 to 11.7. Duke Energy primarily operates in environments that are rate-regulated. In such environments, revenue requirements are adjusted periodically by regulators based on factors including levels of costs, sales volumes and costs of capital.
Management continually assesses whether recorded regulatory assets are probable of future recovery by considering factors such as: • applicable regulatory environment changes; • historical regulatory treatment for similar costs in Duke Energy’s jurisdictions; • litigation of rate orders; • recent rate orders to other regulated entities; • levels of actual return on equity compared to approved rates of return on equity; and • the status of any pending or potential deregulation legislation.
Management continually assesses whether recorded regulatory assets are probable of future recovery by considering factors such as: • applicable regulatory environment changes; • historical regulatory treatment for similar costs in Duke Energy’s jurisdictions; 57 MD&A CRITICAL ACCOUNTING POLICIES AND ESTIMATES • litigation of rate orders; • recent rate orders to other regulated entities; • levels of actual return on equity compared to approved rates of return on equity; and • the status of any pending or potential deregulation legislation.
These investments will drive substantial economic benefits for the communities we serve and reduce our customers' exposure to fuel volatility. We have filed and refined comprehensive IRPs consistent with this strategy in multiple jurisdictions, allowing us to make needed investments to increase grid resiliency and enable coal plant retirements, renewables and energy storage.
These investments will maintain reliability and affordability, drive economic benefits for the communities we serve, deliver cleaner energy and reduce our customers' exposure to fuel volatility. We have filed and refined comprehensive IRPs consistent with this strategy in multiple jurisdictions, allowing us to make needed investments to increase grid resiliency and enable coal plant retirements, renewables and energy storage.
Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida also assume that spent fuel will be stored on-site until such time that it can be transferred to a yet-to-be-built DOE facility. Obligations for closure of ash basins are based upon discounted cash flows of estimated costs for site-specific plans.
Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida also assume that spent fuel will be stored on-site until such time that it can be transferred to a yet-to-be-built DOE facility. 58 MD&A CRITICAL ACCOUNTING POLICIES AND ESTIMATES Obligations for closure of ash basins are based upon discounted cash flows of estimated costs for site-specific plans.
The Duke Energy Registrants would plan to seek recovery of their compliance costs with any new regulations through the regulatory process. 70 MD&A OTHER MATTERS Physical Impacts of Climate Change The Duke Energy Registrants recognize that scientists associate severe weather events with increasing levels of GHGs in the atmosphere.
The Duke Energy Registrants would plan to seek recovery of their compliance costs with any new regulations through the regulatory process. Physical Impacts of Climate Change The Duke Energy Registrants recognize that scientists associate severe weather events with increasing levels of GHGs in the atmosphere.
Duke Energy has $19.3 billion in Goodwill at both December 31, 2023, and 2022.
Duke Energy has $19.3 billion in Goodwill at both December 31, 2024, and 2023.
While customer satisfaction across our industry continues to be impacted by the macroeconomic environment and the impacts of inflationary pressures including higher fuel prices on customer bills, our work continues to be recognized by our customers, with strong customer satisfaction scores in our jurisdictions including Piedmont, which was ranked number one in customer satisfaction by J.D.
While customer satisfaction across our industry continues to be impacted by the macroeconomic environment and the impacts of inflationary pressures including higher fuel prices and interest rates on customer bills, our work continues to be recognized by our customers, with strong customer satisfaction scores in our jurisdictions including Piedmont, which was ranked No. 1 in customer satisfaction by J.D.
We continue to enhance our customers' experience with the Self-Optimizing Grid (SOG), our flagship grid improvement program spanning all of Duke Energy’s regulated utilities. In 2023, our SOG investments helped to avoid approximately 330,000 customer interruptions across our six-state electric service area, preventing customers from having more than 1.4 million hours of lost outage time during major events.
We continue to enhance our customers' experience with the Self-Optimizing Grid (SOG), our flagship grid improvement program spanning all of Duke Energy’s regulated utilities. In 2024, our SOG investments helped to avoid approximately 925,000 customer interruptions across our six-state electric service area, preventing customers from having more than 8.6 million hours of lost outage time during major events.
This preference is the result of generally higher credit ratings for first mortgage bonds and secured debt, which typically result in lower interest costs. Duke Energy Corporation primarily issues unsecured debt. In 2024, Duke Energy anticipates issuing additional securities of $6.9 billion through debt capital markets.
This preference is the result of generally higher credit ratings for first mortgage bonds and secured debt, which typically result in lower interest costs. Duke Energy Corporation primarily issues unsecured debt. In 2025, Duke Energy anticipates issuing additional securities of $12.2 billion through debt capital markets.
Treasury lock agreements to manage and mitigate interest rate risk exposure. See Notes 1, 7, 15 and 17 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies,” “Debt and Credit Facilities,” “Derivatives and Hedging,” and “Fair Value Measurements.” Duke Energ y had $8.0 billion of unhedged long- and short-term floating interest rate exposure at December 31, 2023.
Treasury lock agreements to manage and mitigate interest rate risk exposure. See Notes 1, 7, 15 and 17 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies,” “Debt and Credit Facilities,” “Derivatives and Hedging,” and “Fair Value Measurements.” Duke Energ y ha d $6.6 billion of unhedged long- and short-term floating interest rate exposure at December 31, 2024.
The increase in tax expense was primarily due to a decrease in the amortization of EDIT, partially offset by a decrease in pretax income.
The increase in tax expense was primarily due to an increase in pretax income, partially offset by an increase in the amortization of EDIT.
Coal Ash Act AROs recorded on the Duke Energy Carolinas and Duke Energy Progress Consolidated Balance Sheets at December 31, 2023, and December 31, 2022, include the legal obligation for closure of coal ash basins and the disposal of related ash as a result of the Coal Ash Act, the EPA CCR rule and other agreements.
Coal Ash Act AROs recorded on the Duke Energy Carolinas and Duke Energy Progress Consolidated Balance Sheets at December 31, 2024, and December 31, 2023, include the legal obligation for closure of coal ash basins and the disposal of related ash as a result of the Coal Ash Act, the federal CCR rules and other agreements.
In the Plan, Duke Energy Carolinas and Duke Energy Progress recommended Portfolio 3 as the most prudent path forward to comply with applicable state laws, providing a reliable and orderly energy transition that was proposed as the most reasonable and lowest-cost plan for the Carolinas.
In the Plan, Duke Energy Carolinas and Duke Energy Progress recommended one of the three core portfolios presented, Portfolio 3, as the most prudent path forward to comply with applicable state laws, providing a reliable and orderly energy transition that was proposed as the most reasonable and lowest-cost plan for the Carolinas.
Duke Energy’s contractual cash obligations for fuel and purchased power as of December 31, 2023, are as follows: Payments Due by Period (in millions) Total Less than 1 year (2024) 2-3 years (2025 & 2026) 4-5 years (2027 & 2028) More than 5 years (2029 & beyond) Fuel and purchased power $ 19,726 $ 4,831 $ 6,116 $ 2,991 $ 5,788 Other Purchase Obligations Other purchase obligations includes contracts for software, telephone, data and consulting or advisory services, contractual obligations for Engineering, Procurement, and Construction agreement costs for new generation plants, solar facilities, plant refurbishments, maintenance and day-to-day contract work and commitments to buy certain products.
Duke Energy’s contractual cash obligations for fuel and purchased power as of December 31, 2024, are as follows: Payments Due by Period (in millions) Total Less than 1 year (2025) 2-3 years (2026 & 2027) 4-5 years (2028 & 2029) More than 5 years (2030 & beyond) Fuel and purchased power $ 21,695 $ 5,080 $ 6,706 $ 3,062 $ 6,847 Other Purchase Obligations Other purchase obligations includes contracts for software, telephone, data and consulting or advisory services, contractual obligations for Engineering, Procurement, and Construction agreement costs for new generation plants, solar facilities, plant refurbishments, maintenance and day-to-day contract work and commitments to buy certain products.
Between 2005 and 2023, the Duke Energy Registrants have collectively lowered the CO 2 emissions from their electricity generation by 48%. T imelines and initiatives, as well as implementation of new technologies, for future reductions of GHG emissions will vary in each state in which the Company operates and will involve collaboration with regulators, customers and other stakeholders.
Between 2005 and 2024, the Duke Energy Registrants have collectively lowered the CO 2 emissions from their electricity generation by 44%. Tim elines and initiatives, as well as implementation of new technologies, for future GHG emission reductions will vary in each state in which the Company operates and will involve collaboration with regulators, customers and other stakeholders.
Duke Energy continued to monitor the sales of the Commercial Renewables Disposal Groups throughout 2023 and recorded adjustments to the impairments as warranted by progression in the disposition process and changes in market information.
Duke Energy monitored the sales of the Commercial Renewables Disposal Groups and recorded adjustments to the impairments as warranted by progression in the disposition process and changes in market information.
Our ability to effectively handle all facets of the 2023 storm response efforts while making ongoing investments to enhance the reliability and physical security of the grid, mitigate ongoing macroeconomic challenges, and navigate supply chain constraints, is a testament to our team’s extensive preparation and coordination, applying lessons learned from previous storms, and to on-the-ground management throughout the restoration efforts.
Our ability to effectively handle all facets of the 2024 storm response efforts while making ongoing investments to enhance the reliability and physical security of the grid is a testament to our team’s extensive preparation and coordination, applying lessons learned from previous storms, and on-the-ground management throughout the restoration efforts.
In addition to possible EPA regulation of methane emissions, certain local governments, none within the jurisdictions in which the Duke Energy Registrants operate, have enacted or are considering initiatives to eliminate natural gas use in new buildings and focus on electrification.
Certain local governments, none within the jurisdictions in which the Duke Energy Registrants operate, have enacted or are considering initiatives to eliminate natural gas use in new buildings and focus on electrification.
None of the debt or credit agreements contain material adverse change clauses. 62 MD&A LIQUIDITY AND CAPITAL RESOURCES Credit Ratings Moody’s Investors Service, Inc. and S&P provide credit ratings for various Duke Energy Registrants. The following table includes Duke Energy and certain subsidiaries’ credit ratings and ratings outlook as of February 2024.
None of the debt or credit agreements contain material adverse change clauses. Credit Ratings Moody’s Investors Service, Inc. and S&P provide credit ratings for various Duke Energy Registrants. The following table includes Duke Energy and certain subsidiaries’ credit ratings and ratings outlook as of February 2025.
Increase (Decrease) over prior year 2023 Residential sales (3.5) % General service sales 1.0 % Industrial sales (5.2) % Wholesale power sales 5.0 % Joint dispatch sales (10.9) % Total sales (3.6) % Average number of customers 1.8 % Year Ended December 31, 2023, as compared to 2022 Operating Revenues.
Increase (Decrease) over prior year 2024 Residential sales 4.6 % Commercial sales 2.1 % Industrial sales 0.5 % Wholesale power sales 14.0 % Joint dispatch sales (3.2) % Total sales 3.9 % Average number of customers 2.2 % Year Ended December 31, 2024, as compared to 2023 Operating Revenues.
The goals announced in 2019, and updated in 2022, as well as the actions taken to reduce CO 2 emissions, potentially lower the exposure to any future mandatory CO 2 emission reduction requirements, whether as a result of federal legislation, EPA regulation, state regulation or other as yet unknown emission reduction requirement.
Duke Energy's goals and actions taken to reduce CO 2 emissions potentially lower the exposure to any future mandatory CO 2 emission reduction requirements, whether as a result of federal legislation, EPA regulation, state regulation or other as yet unknown emission reduction requirements.
As we transition our business to cleaner sources of energy, we are focused on delivering sustainable value for our customers and shareholders by leveraging business transformation to exceed customer expectations, optimizing investments to drive attractive shareholder returns, and by providing new product offerings and solutions that deliver growth and customer value.
As we transition our business to meet anticipated increased long-term demand while delivering more efficient sources of energy, we are focused on creating sustainable value for our customers and shareholders by leveraging business transformation to exceed customer expectations, optimizing investments to drive attractive shareholder returns and providing new product offerings and solutions that deliver growth and customer value.
Actions to reduce CO 2 emissions have included the retirement of 56 coal-fired electric generating units with a combined generating capacity of 7,500 MW, while investing in renewables and state-of-the-art highly efficient natural gas-fired generation that produces far fewer CO 2 emissions per unit of electricity generated than coal.
Actions to reduce CO 2 emissions have included the retirement of 58 coal-fired electric generating units with a combined generating capacity of over 8,000 MW, whil e investing in renewables and energy storage and state-of-the-art highly efficient natural gas-fired generation that produces far fewer CO 2 emissions per unit of electricity generated than coal.
New Accounting Standards See Note 1 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies,” for a discussion of the impact of new accounting standards.
New Accounting Standards See Note 1 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies,” for a discussion of the impact of any new accounting standards adopted by the Duke Energy Registrants.
LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX Years Ended December 31, (in millions) 2023 2022 Variance Loss From Discontinued Operations, net of tax $ (1,455) $ (1,323) $ (132) Year Ended December 31, 2023, as compared to 2022 The variance was primarily driven by lower results from Duke Energy's Commercial Renewables Disposal Groups in the current year. 49 MD&A DUKE ENERGY CAROLINAS SUBSIDIARY REGISTRANTS Basis of Presentation The results of operations and variance discussion for the Subsidiary Registrants is presented in a reduced disclosure format in accordance with General Instruction (I)(2)(a) of Form 10-K.
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX Years Ended December 31, (in millions) 2024 2023 Variance Income (Loss) From Discontinued Operations, net of tax $ 10 $ (1,455) $ 1,465 Year Ended December 31, 2024, as compared to 2023 The variance was primarily driven by higher impairments on the sale of the Commercial Renewables business in the prior year. 49 MD&A DUKE ENERGY CAROLINAS SUBSIDIARY REGISTRANTS Basis of Presentation The results of operations and variance discussion for the Subsidiary Registrants is presented in a reduced disclosure format in accordance with General Instruction (I)(2)(a) of Form 10-K.
Amount excludes certain open purchase orders for services that are provided on demand for which the timing of the purchase cannot be determined. Total cash commitments for related other purchase obligation expenditures are $12,286 million, with $11,744 million expected to be paid in the next 12 m onths.
Amount excludes certain open purchase orders for services that are provided on demand for which the timing of the purchase cannot be determined. Total cash commitments for related other purchase obligation expenditures ar e $13,336 million, with $13,015 million exp ected to be paid in the next 12 m onths.
Increase (Decrease) over prior year 2023 Residential sales 1.1 % General service sales 1.2 % Industrial sales (3.2) % Wholesale power sales (49.3) % Total sales (6.1) % Average number of customers 1.8 % Year Ended December 31, 2023, as compared to 2022 Operating Revenues.
Increase (Decrease) over prior year 2024 Residential sales 1.3 % Commercial sales 0.8 % Industrial sales (3.2) % Wholesale power sales 3.9 % Total sales 1.1 % Average number of customers 2.1 % Year Ended December 31, 2024, as compared to 2023 Operating Revenues.
Increase (Decrease) over prior year 2023 Residential sales (4.1) % General service sales (4.0) % Industrial sales (12.2) % Wholesale power sales (3.7) % Joint dispatch sales (1.1) % Total sales (5.3) % Average number of customers 1.7 % Year Ended December 31, 2023, as compared to 2022 Operating Revenues.
Increase (Decrease) over prior year 2024 Residential sales 3.9 % Commercial sales 3.5 % Industrial sales (3.3) % Wholesale power sales 3.8 % Joint dispatch sales 3.4 % Total sales 3.4 % Average number of customers 2.1 % Year Ended December 31, 2024, as compared to 2023 Operating Revenues.
Years Ended December 31, (in millions) 2023 2022 Cash flows provided by (used in): Operating activities $ 9,878 $ 5,927 Investing activities (12,475) (11,973) Financing activities 2,351 6,129 Net (decrease) increase in cash, cash equivalents and restricted cash (246) 83 Cash, cash equivalents and restricted cash at beginning of period 603 520 Cash, cash equivalents and restricted cash at end of period $ 357 $ 603 63 MD&A LIQUIDITY AND CAPITAL RESOURCES OPERATING CASH FLOWS The following table summarizes key components of Duke Energy’s operating cash flows for the two most recently completed fiscal years.
Years Ended December 31, (in millions) 2024 2023 Cash flows provided by (used in): Operating activities $ 12,328 $ 9,878 Investing activities (13,123) (12,475) Financing activities 859 2,351 Net increase (decrease) in cash, cash equivalents and restricted cash 64 (246) Cash, cash equivalents and restricted cash at beginning of period 357 603 Cash, cash equivalents and restricted cash at end of period $ 421 $ 357 62 MD&A LIQUIDITY AND CAPITAL RESOURCES OPERATING CASH FLOWS The following table summarizes key components of Duke Energy’s operating cash flows for the two most recently completed fiscal years.
Duke Energy increased the dividend by approximately 2% annually in both 2023 and 2022, and the Company remains committed to continued growth of the dividend. 61 MD&A LIQUIDITY AND CAPITAL RESOURCES Dividend and Other Funding Restrictions of Duke Energy Subsidiaries As discussed in Note 4 to the Consolidated Financial Statements, “Regulatory Matters,” Duke Energy’s 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.
Dividend and Other Funding Restrictions of Duke Energy Subsidiaries As discussed in Note 4 to the Consolidated Financial Statements, “Regulatory Matters,” Duke Energy’s 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.
In October 2020, Duke Energy announced a new goal to achieve net-zero methane emissions from its natural gas distribution business by 2030.
Duke Energy has a goal to achieve net-zero methane emissions from its natural gas distribution business by 2030.
Despite rising interest rates and near-record mild weather across all of our service territories, we achieved financial results within our adjusted EPS guidance and continued our cost-management journey with a focus on driving productivity, increasing flexibility and prioritizing spend based on risk and strategic value to our customers and investors.
Despite higher interest rates and navigating the operational and financial impacts of unprecedented hurricanes across our service territories, we achieved financial results within our adjusted EPS guidance and continued our cost-management journey with a focus on driving productivity, increasing flexibility and prioritizing spend based on risk and strategic value to our customers and investors.
We actively worked to manage and maintain prices at lower levels than they otherwise would have been in light of increased commodity prices, working with our regulators to extend recovery periods in certain jurisdictions in a way that was manageable for our customers. In 2023, we made substantial progress, recovering $1.5 billion in deferred fuel costs this year.
We actively worked to manage and maintain prices at lower levels than they otherwise would have been in light of increased commodity prices, working with our regulators to extend recovery periods in certain jurisdictions in a way that was manageable for our customers.
Regulatory liabilities are recorded when it is probable that a regulator will require Duke Energy to make refunds to customers or reduce rates to customers for previous collections or deferred revenue for costs that have yet to be incurred.
Regulatory assets generally represent incurred costs that have been deferred because such costs are probable of future recovery in customer rates. Regulatory liabilities are recorded when it is probable that a regulator will require Duke Energy to make refunds to customers or reduce rates to customers for previous collections or deferred revenue for costs that have yet to be incurred.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES Preparation of financial statements requires the application of accounting policies, judgments, assumptions and estimates that can significantly affect the reported results of operations, cash flows or the amounts of assets and liabilities recognized in the financial statements.
The increase in tax expense was primarily due to an increase in pretax income. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Preparation of financial statements requires the application of accounting policies, judgments, assumptions and estimates that can significantly affect the reported results of operations, cash flows or the amounts of assets and liabilities recognized in the financial statements.
The companies filed supplemental modeling and analysis with the NCUC and PSCSC in January 2024, demonstrating the need for additional resources beyond the initial set of resources identified by the companies in their initial plan. The NCUC has scheduled an evidentiary hearing for July 2024, with an order expected by the end of 2024.
The companies filed supplemental modeling and analysis with the NCUC and PSCSC in January 2024, demonstrating the need for additional resources beyond the initial set of resources identified by the companies in their initial plan.
At the three remaining basins at Belews Creek, Marshall and Roxboro, uncapped basin ash will be excavated and moved to lined landfills. Those portions of the basins at Belews Creek, Marshall and Roxboro, which were previously filled with ash and on which permitted facilities were constructed, will not be disturbed and will be closed pursuant to other state regulations.
At the three remaining basins at Belews Creek, Marshall and Roxboro, uncapped basin ash will be excavated and moved to lined landfills. Those portions of the basins at Belews Creek, Marshall and Roxboro, which were previously filled with ash and on which permitted facilities were constructed, will be addressed as required under the 2024 CCR Rule and state regulations.
The increase in tax expense was primarily due to an increase in pretax income and a decrease in the amortization of EDIT, partially offset by an increase in PTCs.
The increase in tax expense was primarily due to an increase in pretax income, partially offset by an increase in PTCs.
As of December 31, 2023, Duke Energy had approximately $253 million of cash on hand, $4.9 billion available under its $9 billion Master Credit Facility. Duke Energy expects to have sufficient liquidity in the form of cash on hand, cash from operations and available credit capacity to support its funding needs.
As of December 31, 2024, Duke Energy had approximate ly $314 million of cash on hand, $5.8 billion available u nder its $9 billion Master Credit Facility. Duke Energy expects to have sufficient liquidity in the form of cash on hand, cash from operations and available credit capacity to support its funding needs.
We also continue to make the investments necessary to support our ongoing clean energy transition and a business portfolio that delivers a reliable and growing dividend, with 2023 representing the 97th consecutive year Duke Energy paid a cash dividend on its common stock. 40 MD&A DUKE ENERGY Financial Results (a) See Results of Operations below for Duke Energy’s definition of adjusted earnings and adjusted EPS as well as a reconciliation of this non-GAAP financial measure to net income available to Duke Energy and net income available to Duke Energy per basic share.
We continue to rebuild the most heavily damaged infrastructure impacted by storms in our service territories, engage with our customers and make critical investments to support our ongoing energy transition and a business portfolio that delivers a reliable and growing dividend, with 2024 representing the 98th consecutive year Duke Energy paid a cash dividend on its common stock. 39 MD&A DUKE ENERGY Financial Results (a) See Results of Operations below for Duke Energy’s definition of adjusted earnings and adjusted EPS as well as a reconciliation of this non-GAAP financial measure to net income available to Duke Energy and net income available to Duke Energy per basic share.
In January 2024, we filed supplemental modeling and analysis with the NCUC and PSCSC due to substantially increased load forecasts resulting from continued economic development successes in the Carolinas occurring since the system-wide plan was prepared.
In January 2024, we filed supplemental modeling and analysis with the NCUC and PSCSC related to our combined systemwide Carolinas Resource Plan filed in 2023. These updates were necessary due to substantially increased load forecasts resulting from continued economic development successes in the Carolinas occurring since the systemwide integrated resource plan was prepared.
In addition to the drivers below, the increase in GAAP Reported Earnings/EPS was also due to higher regulatory charges in the prior year. 45 MD&A DUKE ENERGY As discussed and shown in the table above, management also evaluates financial performance based on adjusted EPS.
In addition to the drivers below, the increase in GAAP Reported Earnings/EPS was also due to higher impairments on the sale of the Commercial Renewables business in the prior year. As discussed and shown in the table above, management also evaluates financial performance based on adjusted EPS.
Years Ended December 31, (in millions) 2023 2022 Variance Electric Utilities and Infrastructure $ 10,135 $ 8,985 $ 1,150 Gas Utilities and Infrastructure 1,492 1,295 197 Other 995 1,139 (144) Total capital, investment and acquisition expenditures, net of return of investment capital $ 12,622 $ 11,419 $ 1,203 FINANCING CASH FLOWS The following table summarizes key components of Duke Energy’s financing cash flows for the two most recently completed fiscal years.
Years Ended December 31, (in millions) 2024 2023 Variance Electric Utilities and Infrastructure $ 10,689 $ 10,135 $ 554 Gas Utilities and Infrastructure 1,313 1,492 (179) Other 261 995 (734) Total capital, investment and acquisition expenditures, net of return of investment capital $ 12,263 $ 12,622 $ (359) FINANCING CASH FLOWS The following table summarizes key components of Duke Energy’s financing cash flows for the two most recently completed fiscal years.
Electric Natural Gas Increase (Decrease) over prior year 2023 2023 Residential sales (4.8) % (13.5) % General service sales 1.5 % (19.7) % Industrial sales 4.9 % 3.8 % Wholesale electric power sales (19.3) % n/a Other natural gas sales n/a (0.7) % Total sales (4.0) % (10.8) % Average number of customers 0.9 % 0.6 % Year Ended December 31, 2023, as compared to 2022 Operating Revenues .
Electric Natural Gas Increase (Decrease) over prior year 2024 2024 Residential sales 4.5 % (6.0) % Commercial sales 4.1 % (4.0) % Industrial sales (3.8) % 20.2 % Wholesale electric power sales 16.6 % n/a Other natural gas sales n/a (1.1) % Total sales 2.9 % (2.0) % Average number of customers 1.1 % 0.8 % 54 MD&A DUKE ENERGY OHIO Year Ended December 31, 2024, as compared to 2023 Operating Revenues .
Interest Expense. The variance was primarily due to higher interest rates and outstanding debt balances. Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income and a decrease in the amortization of EDIT, partially offset by an increase in PTCs.
Other Income and Expenses, net. The decrease is primarily due to lower intercompany interest income. Interest Expense. The increase is primarily due to higher outstanding debt balances and interest rates. Income Tax Expense. The decrease in tax expense was primarily due to a decrease in pretax income and an increase in the amortization of EDIT.
See Note 18 to the Consolidated Financial Statements, “Variable Interest Entities.” The Duke Energy Registrants provide certain non-tariff services, primarily to large commercial and industrial customers in which incurred costs, including invested capital, are intended to be recovered from the individual customer and therefore are not subject to rate recovery in the event of customer default.
The Duke Energy Registrants provide certain non-tariff services, primarily to large commercial and industrial customers in which incurred costs, including invested capital, are intended to be recovered from the individual customer and therefore are not subject to rate recovery in the event of customer default. Customer creditworthiness is assessed prior to entering into these transactions.
Where the Duke Energy Registrants have issued guarantees related to assets or operations that have been disposed of via sale, they attempt to secure indemnification from the buyer against all future performance obligations under the guarantees. See Note 8 to the Consolidated Financial Statements, “Guarantees and Indemnifications,” for further information on guarantees issued by the Duke Energy Registrants.
Where the Duke Energy Registrants have issued guarantees related to assets or operations that have been disposed of via sale, they attempt to secure indemnification from the buyer against all future performance obligations under the guarantees.

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