Duke Energy 10-K 2021-12-31

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

(Mark One)

☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2021 or

☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from________to________

Commission file number			Registrant, State of Incorporation or Organization, Address of Principal Executive Offices and Telephone Number			IRS Employer Identification No.
1-32853			DUKE ENERGY CORPORATION			20-2777218

(a Delaware corporation)

526 South Church Street

Charlotte, North Carolina 28202-1803

704-382-3853

1-4928			DUKE ENERGY CAROLINAS, LLC						56-0205520

(a North Carolina limited liability company)

526 South Church Street

Charlotte, North Carolina 28202-1803

704-382-3853

1-15929			PROGRESS ENERGY, INC.						56-2155481

(a North Carolina corporation)

410 South Wilmington Street

Raleigh, North Carolina 27601-1748

704-382-3853

1-3382			DUKE ENERGY PROGRESS, LLC						56-0165465

(a North Carolina limited liability company)

410 South Wilmington Street

Raleigh, North Carolina 27601-1748

704-382-3853

1-3274			DUKE ENERGY FLORIDA, LLC						59-0247770

(a Florida limited liability company)

299 First Avenue North

St. Petersburg, Florida 33701

704-382-3853

1-1232			DUKE ENERGY OHIO, INC.						31-0240030

(an Ohio corporation)

139 East Fourth Street

Cincinnati, Ohio 45202

704-382-3853

1-3543			DUKE ENERGY INDIANA, LLC						35-0594457

(an Indiana limited liability company)

1000 East Main Street

Plainfield, Indiana 46168

704-382-3853

1-6196			PIEDMONT NATURAL GAS COMPANY, INC.						56-0556998

(a North Carolina corporation)

4720 Piedmont Row Drive

Charlotte, North Carolina 28210

704-364-3120

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

Name of each exchange on

Registrant Title of each class Trading symbols which registered

Duke Energy Corporation Common Stock, $0.001 par value DUK New York Stock Exchange LLC

(Duke Energy)

Duke Energy 5.625% Junior Subordinated Debentures due DUKB New York Stock Exchange LLC

September 15, 2078

Duke Energy Depositary Shares, each representing a 1/1,000th DUK PR A New York Stock Exchange LLC

interest in a share of 5.75% Series A Cumulative

Redeemable Perpetual Preferred Stock, par value

$0.001 per share

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Duke Energy			Yes			☒			No			☐						Duke Energy Florida, LLC (Duke Energy Florida)			Yes			☒			No			☐
Duke Energy Carolinas, LLC (Duke Energy Carolinas)			Yes			☒			No			☐						Duke Energy Ohio, Inc. (Duke Energy Ohio)			Yes			☒			No			☐
Progress Energy, Inc. (Progress Energy)			Yes			☐			No			☒						Duke Energy Indiana, LLC (Duke Energy Indiana)			Yes			☒			No			☐
Duke Energy Progress, LLC (Duke Energy Progress)			Yes			☒			No			☐						Piedmont Natural Gas Company, Inc. (Piedmont)			Yes			☒			No			☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☒ (Response applicable to all registrants.)

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrants have submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ¨

Indicate by check mark whether Duke Energy is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.:

Large Accelerated Filer ☒ Accelerated Filer ¨ Non-accelerated Filer ☐ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether each of Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont is a large accelerated filer, accelerated filer, non-accelerated filer, smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.:

Large Accelerated Filer ¨ Accelerated Filer ¨ Non-accelerated Filer ☒ Smaller Reporting Company ☐ Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7252(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

Indicate by check mark whether each of the registrants is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

Estimated aggregate market value of the common equity held by nonaffiliates of Duke Energy at June 30, 2021.			$	75,871,309,901
Number of shares of Common Stock, $0.001 par value, outstanding at January 31, 2022.			769,358,344

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Duke Energy definitive proxy statement for the 2021 Annual Meeting of the Shareholders or an amendment to this Annual Report are incorporated by reference into PART III, Items 10, 11 and 13 hereof.

This combined Form 10-K is filed separately by eight registrants: Duke Energy, Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont (collectively the Duke Energy Registrants). Information contained herein relating to any individual registrant is filed by such registrant solely on its own behalf. Each registrant makes no representation as to information relating exclusively to the other registrants.

Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont meet the conditions set forth in General Instructions I(1)(a) and (b) of Form 10-K and are, therefore, filing this Form 10-K with the reduced disclosure format specified in General Instructions I(2) of Form 10-K.

Auditor Firm ID: 34 Auditor Name: Deloitte & Touche LLP Auditor Location: Charlotte, NC

TABLE OF CONTENTS

TABLE OF CONTENTS

FORM 10-K FOR THE YEAR ENDED December 31, 2021

Item						Page
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
GLOSSARY OF TERMS
PART I.
1.			BUSINESS			9
			DUKE ENERGY			9
			GENERAL			9
			BUSINESS SEGMENTS			9
			EMPLOYEES			20
			EXECUTIVE OFFICERS			22
			ENVIRONMENTAL MATTERS			23
			DUKE ENERGY CAROLINAS			23
			PROGRESS ENERGY			23
			DUKE ENERGY PROGRESS			23
			DUKE ENERGY FLORIDA			24
			DUKE ENERGY OHIO			24
			DUKE ENERGY INDIANA			24
			PIEDMONT			24
1A.			RISK FACTORS			24
1B.			UNRESOLVED STAFF COMMENTS			33
2.			PROPERTIES			34
3.			LEGAL PROCEEDINGS			38
4.			MINE SAFETY DISCLOSURES			38
PART II.
5.			MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES			39
6.			SELECTED FINANCIAL DATA			39
7.			MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			40
7A.			QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			70
8.			FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA			71
9.			CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE			230
9A.			CONTROLS AND PROCEDURES			230
PART III.
10.			DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE			232
11.			EXECUTIVE COMPENSATION			232
12.			SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS			232
13.			CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE			232
14.			PRINCIPAL ACCOUNTING FEES AND SERVICES			233
PART IV.
15.			EXHIBITS AND FINANCIAL STATEMENT SCHEDULES			234
			EXHIBIT INDEX			E-1
			SIGNATURES			E-2

FORWARD LOOKING STATEMENTS

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION

This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on management’s beliefs and assumptions and can often be identified by terms and phrases that include “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will,” “potential,” “forecast,” “target,” “guidance,” “outlook” or other similar terminology. Various factors may cause actual results to be materially different than the suggested outcomes within forward-looking statements; accordingly, there is no assurance that such results will be realized. These factors include, but are not limited to:

◦The impact of the COVID-19 pandemic;

◦State, federal and foreign legislative and regulatory initiatives, including costs of compliance with existing and future environmental requirements, including those related to climate change, as well as rulings that affect cost and investment recovery or have an impact on rate structures or market prices;

◦The extent and timing of costs and liabilities to comply with federal and state laws, regulations and legal requirements related to coal ash remediation, including amounts for required closure of certain ash impoundments, are uncertain and difficult to estimate;

◦The ability to recover eligible costs, including amounts associated with coal ash impoundment retirement obligations, asset retirement and construction costs related to carbon emissions reductions, and costs related to significant weather events, and to earn an adequate return on investment through rate case proceedings and the regulatory process;

◦The costs of decommissioning nuclear facilities could prove to be more extensive than amounts estimated and all costs may not be fully recoverable through the regulatory process;

◦Costs and effects of legal and administrative proceedings, settlements, investigations and claims;

◦Industrial, commercial and residential growth or decline in service territories or customer bases resulting from sustained downturns of the economy and the economic health of our service territories or variations in customer usage patterns, including energy efficiency efforts, natural gas building and appliance electrification, and use of alternative energy sources, such as self-generation and distributed generation technologies;

◦Federal and state regulations, laws and other efforts designed to promote and expand the use of energy efficiency measures, natural gas electrification, and distributed generation technologies, such as private solar and battery storage, in Duke Energy service territories could result in a reduced number of customers, excess generation resources as well as stranded costs;

◦Advancements in technology;

◦Additional competition in electric and natural gas markets and continued industry consolidation;

◦The influence of weather and other natural phenomena on operations, including the economic, operational and other effects of severe storms, hurricanes, droughts, earthquakes and tornadoes, including extreme weather associated with climate change;

◦Changing investor, customer and other stakeholder expectations and demands including heightened emphasis on environmental, social and governance concerns;

◦The ability to successfully operate electric generating facilities and deliver electricity to customers including direct or indirect effects to the company resulting from an incident that affects the United States electric grid or generating resources;

◦Operational interruptions to our natural gas distribution and transmission activities;

◦The availability of adequate interstate pipeline transportation capacity and natural gas supply;

◦The impact on facilities and business from a terrorist attack, cybersecurity threats, data security breaches, operational accidents, information technology failures or other catastrophic events, such as fires, explosions, pandemic health events or other similar occurrences;

◦The inherent risks associated with the operation of nuclear facilities, including environmental, health, safety, regulatory and financial risks, including the financial stability of third-party service providers;

◦The timing and extent of changes in commodity prices and interest rates and the ability to recover such costs through the regulatory process, where appropriate, and their impact on liquidity positions and the value of underlying assets;

◦The results of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings, interest rate fluctuations, compliance with debt covenants and conditions, an individual utility’s generation mix, and general market and economic conditions;

◦Credit ratings of the Duke Energy Registrants may be different from what is expected;

◦Declines in the market prices of equity and fixed-income securities and resultant cash funding requirements for defined benefit pension plans, other post-retirement benefit plans and nuclear decommissioning trust funds;

◦Construction and development risks associated with the completion of the Duke Energy Registrants’ capital investment projects, including risks related to financing, obtaining and complying with terms of permits, meeting construction budgets and schedules and satisfying operating and environmental performance standards, as well as the ability to recover costs from customers in a timely manner, or at all;

◦Changes in rules for regional transmission organizations, including changes in rate designs and new and evolving capacity markets, and risks related to obligations created by the default of other participants;

FORWARD LOOKING STATEMENTS

◦The ability to control operation and maintenance costs;

◦The level of creditworthiness of counterparties to transactions;

◦The ability to obtain adequate insurance at acceptable costs;

◦Employee workforce factors, including the potential inability to attract and retain key personnel;

◦The ability of subsidiaries to pay dividends or distributions to Duke Energy Corporation holding company (the Parent);

◦The performance of projects undertaken by our nonregulated businesses and the success of efforts to invest in and develop new opportunities;

◦The effect of accounting pronouncements issued periodically by accounting standard-setting bodies;

◦The impact of United States tax legislation to our financial condition, results of operations or cash flows and our credit ratings;

◦The impacts from potential impairments of goodwill or equity method investment carrying values;

◦Asset or business acquisitions and dispositions, including our ability to successfully consummate the second closing of the minority investment in Duke Energy Indiana, may not yield the anticipated benefits;

◦The actions of activist shareholders could disrupt our operations, impact our ability to execute on our business strategy, or cause fluctuations in the trading price of our common stock; and

◦The ability to implement our business strategy, including its carbon emission reduction goals.

Additional risks and uncertainties are identified and discussed in the Duke Energy Registrants' reports filed with the SEC and available at the SEC's website at sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than described. Forward-looking statements speak only as of the date they are made and the Duke Energy Registrants expressly disclaim an obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

GLOSSARY OF TERMS

Glossary of Terms

The following terms or acronyms used in this Form 10-K are defined below:

Term or Acronym			Definition
2017 Settlement			Second Revised and Restated Settlement Agreement in 2017 among Duke Energy Florida, the Florida Office of Public Counsel and other customer advocates, which replaces and supplants the 2013 Settlement
2021 Settlement			Settlement Agreement in 2021 among Duke Energy Florida, the Florida Office of Public Counsel, the Florida Industrial Power Users Group, White Springs Agricultural Chemicals, Inc. d/b/a PSC Phosphate and NUCOR Steel Florida, Inc.
ACP			Atlantic Coast Pipeline, LLC, a limited liability company owned by Dominion and Duke Energy
ACP pipeline			The approximately 600-mile canceled interstate natural gas pipeline
AFS			Available for Sale
AFUDC			Allowance for funds used during construction
AMI			Advanced Metering Infrastructure
AMT			Alternative Minimum Tax
AOCI			Accumulated Other Comprehensive Income (Loss)
ARO			Asset Retirement Obligation
Audit Committee			Audit Committee of the Board of Directors
Belews Creek			Belews Creek Steam Station
Bison			Bison Insurance Company Limited
Board of Directors			Duke Energy Board of Directors
Brunswick			Brunswick Nuclear Plant
Cardinal			Cardinal Pipeline Company, LLC
Catawba			Catawba Nuclear Station
CC			Combined Cycle
CCR			Coal Combustion Residuals
Cinergy			Cinergy Corp. (collectively with its subsidiaries)
Citrus County CC			Citrus County Combined Cycle Facility
CO2			Carbon Dioxide
Coal Ash Act			North Carolina Coal Ash Management Act of 2014
the company			Duke Energy Corporation and its subsidiaries
Constitution			Constitution Pipeline Company, LLC
COVID-19			Coronavirus Disease 2019
CPCN			Certificate of Public Convenience and Necessity
CRC			Cinergy Receivables Company LLC
Crystal River Unit 3			Crystal River Unit 3 Nuclear Plant
CT			Combustion Turbine
DATC			Duke-American Transmission Company, LLC
DECON			A method of decommissioning in which structures, systems, and components that contain radioactive contamination are removed from a site and safely disposed at a commercially operated low-level waste disposal facility, or decontaminated to a level that permits the site to be released for unrestricted use shortly after it ceases operation
DEFR			Duke Energy Florida Receivables, LLC
Deloitte			Deloitte & Touche LLP, and the member firms of Deloitte Touche Tohmatsu and their respective affiliates
DEPR			Duke Energy Progress Receivables, LLC
DERF			Duke Energy Receivables Finance Company, LLC
DOE			U.S. Department of Energy
Dominion			Dominion Energy, Inc.

GLOSSARY OF TERMS

Dth			Dekatherms
Duke Energy			Duke Energy Corporation (collectively with its subsidiaries)
Duke Energy Carolinas			Duke Energy Carolinas, LLC
Duke Energy Florida			Duke Energy Florida, LLC
Duke Energy Indiana			Duke Energy Indiana, LLC
Duke Energy Kentucky			Duke Energy Kentucky, Inc.
Duke Energy Ohio			Duke Energy Ohio, Inc.
Duke Energy Progress			Duke Energy Progress, LLC
Duke Energy Registrants			Duke Energy, Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont
East Bend			East Bend Generating Station
EDIT			Excess deferred income tax
EE			Energy efficiency
EPA			U.S. Environmental Protection Agency
EPC			Engineering, Procurement and Construction agreement
EPS			Earnings Per Share
ETR			Effective tax rate
Exchange Act			Securities Exchange Act of 1934
FASB			Financial Accounting Standards Board
FERC			Federal Energy Regulatory Commission
Form S-3			Registration statement
FPSC			Florida Public Service Commission
FTR			Financial transmission rights
FV-NI			Fair value through net income
GAAP			Generally Accepted Accounting Principles in the United States
GAAP Reported Earnings			Net Income Available to Duke Energy Corporation common stockholders
GAAP Reported EPS			Basic EPS Available to Duke Energy Corporation common stockholders
GHG			Greenhouse Gas
GIC			GIC Private Limited, Singapore's sovereign wealth fund and an experienced investor in U.S. infrastructure
GWh			Gigawatt-hour
Hardy Storage			Hardy Storage Company, LLC
Harris			Shearon Harris Nuclear Plant
HLBV			Hypothetical Liquidation at Book Value
IMPA			Indiana Municipal Power Agency
IMR			Integrity Management Rider
IRP			Integrated Resource Plans
IRS			Internal Revenue Service
ISO			Independent System Operator
ITC			Investment Tax Credit
IURC			Indiana Utility Regulatory Commission
Investment Trusts			Grantor trusts of Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana
KO Transmission			KO Transmission Company
KPSC			Kentucky Public Service Commission
LIBOR			London Interbank Offered Rate
LLC			Limited Liability Company

GLOSSARY OF TERMS

McGuire			McGuire Nuclear Station
MGP			Manufactured gas plant
MISO			Midcontinent Independent System Operator, Inc.
MTBE			Methyl tertiary butyl ether
MW			Megawatt
MWh			Megawatt-hour
NCDEQ			North Carolina Department of Environmental Quality
NCUC			North Carolina Utilities Commission
NDTF			Nuclear decommissioning trust funds
New Source Review			Clean Air Act program that requires industrial facilities to install modern pollution control equipment when they are built or when making a change that increases emissions significantly
NMC			National Methanol Company
NOL			Net operating loss
NPNS			Normal purchase/normal sale
NRC			U.S. Nuclear Regulatory Commission
NYSE			New York Stock Exchange
Oconee			Oconee Nuclear Station
OPEB			Other Post-Retirement Benefit Obligations
OTTI			Other-than-temporary impairment
OVEC			Ohio Valley Electric Corporation
the Parent			Duke Energy Corporation holding company
PGA			Purchased Gas Adjustments
PHMSA			Pipeline and Hazardous Materials Safety Administration
Piedmont			Piedmont Natural Gas Company, Inc.
Pine Needle			Pine Needle LNG Company, LLC
Pioneer			Pioneer Transmission, LLC
PJM			PJM Interconnection, LLC
PMPA			Piedmont Municipal Power Agency
PISCC			Post-in-service carrying costs
PPA			Purchase Power Agreement
Progress Energy			Progress Energy, Inc.
PSCSC			Public Service Commission of South Carolina
PTC			Production Tax Credits
PUCO			Public Utilities Commission of Ohio
PURPA			Public Utility Regulatory Policies Act of 1978
QF			Qualifying Facility
REC			Renewable Energy Certificate
Relative TSR			TSR of Duke Energy stock relative to a predefined peer group
Robinson			Robinson Nuclear Plant
ROU			Right-of-use
RSU			Restricted Stock Unit
RTO			Regional Transmission Organization
Sabal Trail			Sabal Trail Transmission, LLC
SAFSTOR			A method of decommissioning in which a nuclear facility is placed and maintained in a condition that allows the facility to be safely stored and subsequently decontaminated to levels that permit release for unrestricted use

GLOSSARY OF TERMS

SEC			Securities and Exchange Commission
S&P			Standard & Poor’s Rating Services
State utility commissions			NCUC, PSCSC, FPSC, PUCO, IURC, KPSC and TPUC (Collectively)
State electric utility commissions			NCUC, PSCSC, FPSC, PUCO, IURC and KPSC (Collectively)
State gas utility commissions			NCUC, PSCSC, PUCO, TPUC and KPSC (Collectively)
Subsidiary Registrants			Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont
Sutton			L.V. Sutton Combined Cycle Plant
the Tax Act			Tax Cuts and Jobs Act
TPUC			Tennessee Public Utility Commission
TSR			Total shareholder return
U.S.			United States
VIE			Variable Interest Entity
WACC			Weighted Average Cost of Capital
W.S. Lee CC			William States Lee Combined Cycle Facility
WVPA			Wabash Valley Power Association, Inc.

BUSINESS

DUKE ENERGY

General

Duke Energy was incorporated on May 3, 2005, and is an energy company headquartered in Charlotte, North Carolina, subject to regulation by the FERC and other regulatory agencies listed below. Duke Energy operates in the U.S. primarily through its direct and indirect subsidiaries. Certain Duke Energy subsidiaries are also Subsidiary Registrants, including Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont. When discussing Duke Energy’s consolidated financial information, it necessarily includes the results of its separate Subsidiary Registrants, which along with Duke Energy, are collectively referred to as the Duke Energy Registrants.

The Duke Energy Registrants electronically file reports with the SEC, including Annual Reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, proxy statements and amendments to such reports.

The SEC maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC at sec.gov. Additionally, information about the Duke Energy Registrants, including reports filed with the SEC, is available through Duke Energy’s website at duke-energy.com. Such reports are accessible at no charge and are made available as soon as reasonably practicable after such material is filed with or furnished to the SEC.

Business Segments

Duke Energy's segment structure includes three reportable business segments: Electric Utilities and Infrastructure, Gas Utilities and Infrastructure and Commercial Renewables. The remainder of Duke Energy’s operations is presented as Other. Duke Energy's chief operating decision-maker routinely reviews financial information about each of these business segments in deciding how to allocate resources and evaluate the performance of the business. For additional information on each of these business segments, including financial and geographic information, see Note 2 to the Consolidated Financial Statements, “Business Segments.” The following sections describe the business and operations of each of Duke Energy’s business segments, as well as Other.

ELECTRIC UTILITIES AND INFRASTRUCTURE

Electric Utilities and Infrastructure 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. Electric Utilities and Infrastructure provides retail electric service through the generation, transmission, distribution and sale of electricity to approximately 8.2 million customers within the Southeast and Midwest regions of the U.S. The service territory is approximately 91,000 square miles across six states with a total estimated population of 26 million. The operations include electricity sold wholesale to municipalities, electric cooperative utilities and other load-serving entities.

During 2021, Duke Energy executed an agreement providing for an investment by an affiliate of GIC in Duke Energy Indiana in exchange for a 19.9% minority interest issued by Duke Energy Holdco, LLC, the holding company for Duke Energy Indiana. The transaction will be completed following two closings. The first closing occurred on September 8, 2021, and resulted in Duke Energy Indiana Holdco, LLC issuing 11.05% of its membership interest to the affiliate of GIC. The second closing is expected to occur no later than January 2023. See Note 1 to the Consolidated Financial Statements, “Summary of Significant Accounting Policies," for additional information. Electric Utilities and Infrastructure is also a joint owner in certain electric transmission projects. Electric Utilities and Infrastructure has a 50% ownership interest in DATC, a partnership with American Transmission Company, formed to design, build and operate transmission infrastructure. DATC owns 72% of the transmission service rights to Path 15, an 84-mile transmission line in central California. Electric Utilities and Infrastructure also has a 50% ownership interest in Pioneer, which builds, owns and operates electric transmission facilities in North America. The following map shows the service territory for Electric Utilities and Infrastructure as of December 31, 2021.

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 table represents the distribution of GWh billed sales by customer class for the year ended December 31, 2021.

			Duke						Duke						Duke						Duke						Duke
			Energy						Energy						Energy						Energy						Energy
			Carolinas						Progress						Florida						Ohio						Indiana
Residential			33		%				28		%				49		%				38		%				30		%
General service			32		%				22		%				35		%				37		%				25		%
Industrial			24		%				14		%				8		%				23		%				31		%
Total retail sales			89		%				64		%				92		%				98		%				86		%
Wholesale and other sales			11		%				36		%				8		%				2		%				14		%
Total sales			100		%				100		%				100		%				100		%				100		%

The number of residential and general service customers within the Electric Utilities and Infrastructure service territory is expected to increase over time. Sales growth is expected within the service territory but continues to be impacted by adoption of energy efficiencies and self-generation. Residential sales increased in 2021 compared to 2020 due to customer growth and the introduction of a hybrid work environment in response to multiple waves of COVID-19 during 2021. Meanwhile, sales for general service and industrial customers recovered in 2021 from temporary closings and ramp backs experienced in 2020 due to the COVID-19 pandemic. Over the longer time frame, it is still expected that the continued adoption of more efficient housing and appliances will have a negative impact on average usage per residential customer over time.

Seasonality and the Impact of Weather

Revenues and costs are influenced by seasonal weather patterns. Peak sales of electricity occur during the summer and winter months, which results in higher revenue and cash flows during these periods. By contrast, lower sales of electricity occur during the spring and fall, allowing for scheduled plant maintenance. Residential and general service customers are more impacted by weather than industrial customers. Estimated weather impacts are based on actual current period weather compared to normal weather conditions. Normal weather conditions are defined as the

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In addition to other disclosures within this Form 10-K, including "Management's Discussion and Analysis of Financial Condition and Results of Operations – Matters Impacting Future Results" for each registrant in Item 7, and other documents filed with the SEC from time to time, the following factors should be considered in evaluating Duke Energy and its subsidiaries. Such factors could affect actual results of operations and cause results to differ substantially from those currently expected or sought. Unless otherwise indicated, risk factors discussed below generally relate to risks associated with all of the Duke Energy Registrants. Risks identified at the Subsidiary Registrant level are generally applicable to Duke Energy.

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.

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 clean energy strategy, 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.

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. Supportive policies may be needed to facilitate the siting and cost recovery of transmission and distribution upgrades needed to accommodate the build out of large volumes of renewables and energy storage. Further, the approval of our state regulators will be necessary for the company to continue to retire existing carbon emitting assets or make investments in new generating capacity. The company may be constrained by the ability to procure resources or labor needed to build new generation at a reasonable price as well as to construct projects on time. In addition, new technologies that are not yet commercially available or are unproven at utility scale will be needed. If these technologies are not developed or are not available at reasonable prices, or if we invest in early-stage technologies that are then supplanted by technological breakthroughs, Duke Energy’s ability to achieve a net-zero target by 2050 at a cost-effective price could be at risk.

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, Our nuclear fleet is central to our ability to meet these objectives and customer expectations. We are continuing to seek to renew the operating licenses of the 11 reactors we operate at six nuclear stations for an additional 20 years, extending their operating lives to and beyond midcentury. Failure to receive approval from the NRC for the relicensing of any of these reactors could affect our ability to achieve a net-zero target by 2050.

As a consequence, Duke Energy may not be able to fully implement or realize the anticipated results of its strategy, which may have an adverse effect on its financial condition.

REGULATORY, LEGISLATIVE AND LEGAL RISKS

The Duke Energy Registrants’ regulated utility revenues, earnings and results are dependent on state legislation and regulation that affect electric generation, electric and natural gas transmission, distribution and related activities, which may limit their ability to recover costs.

The Duke Energy Registrants’ regulated electric and natural gas utility businesses are regulated on a cost-of-service/rate-of-return basis subject to statutes and regulatory commission rules and procedures of North Carolina, South Carolina, Florida, Ohio, Tennessee, Indiana and Kentucky. If the Duke Energy Registrants’ regulated utility earnings exceed the returns established by the state utility commissions, retail electric and natural gas rates may be subject to review and possible reduction by the commissions, which may decrease the Duke Energy Registrants’ earnings. Additionally, if regulatory 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. Differences in regulation between jurisdictions with concurrent operations, such as North Carolina and South Carolina in Duke Energy Carolinas' and Duke Energy Progress' service territory, may also result in failure to recover costs.

If legislative and regulatory structures were to evolve in such a way that the Duke Energy Registrants’ exclusive rights to serve their regulated customers were eroded, their earnings could be negatively impacted. Federal and state regulations, laws, commercialization and reduction of costs and other efforts designed to promote and expand the use of EE measures and distributed generation technologies, such as private solar and battery storage, in Duke Energy service territories could reduce recovery of fixed costs in Duke Energy service territories or result in customers leaving the electric distribution system and an increase in customer net energy metering, which allows customers with private solar to receive bill credits for surplus power at the full retail amount. 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. State regulators have approved other margin stabilizing mechanisms that, for example, allow for recovery of margin losses associated with negotiated transactions designed to retain large volume customers that could use alternative fuels or that may otherwise directly access natural gas supply through their own connection to an interstate pipeline. If regulators decided to discontinue the Duke Energy Registrants' use of tariff mechanisms, it would negatively impact results of operations, financial position and cash flows. In addition, regulatory authorities also review whether natural gas costs are prudently incurred and can disallow the recovery of a portion of natural gas costs that the Duke Energy Registrants seek to recover from customers, which would adversely impact earnings.

The rates that the Duke Energy Registrants’ regulated utility businesses are allowed to charge are established by state utility commissions in rate case proceedings, which may limit their ability to recover costs and earn an appropriate return on investment.

The rates that the Duke Energy Registrants’ regulated utility business are allowed to charge significantly influences the results of operations, financial position and cash flows of the Duke Energy Registrants. The regulation of the rates that the regulated utility businesses charge customers is determined, in large part, by state utility commissions in rate case proceedings. Negative decisions made by these regulators, or by any court on appeal of a rate case proceeding, 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 recover costs and an appropriate return on the significan

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PROPERTIES

ELECTRIC UTILITIES AND INFRASTRUCTURE

The following table provides information related to the Electric Utilities and Infrastructure's generation stations as of December 31, 2021. The MW displayed in the table below are based on summer capacity. Ownership interest in all facilities is 100% unless otherwise indicated.

															Owned MW
Facility			Plant Type			Primary Fuel			Location						Capacity
Duke Energy Carolinas
Oconee			Nuclear			Uranium			SC						2,554
McGuire			Nuclear			Uranium			NC						2,316
Catawba(a)			Nuclear			Uranium			SC						445
Belews Creek			Fossil			Coal/Gas			NC						2,220
Marshall			Fossil			Coal/Gas			NC						2,058
J.E. Rogers			Fossil			Coal/Gas			NC						1,388
Lincoln Combustion Turbine (CT)			Fossil			Gas/Oil			NC						1,161
Allen			Fossil			Coal			NC						840
Rockingham CT			Fossil			Gas/Oil			NC						825
W.S. Lee Combined Cycle (CC)(b)			Fossil			Gas			SC						686
Buck CC			Fossil			Gas			NC						668
Dan River CC			Fossil			Gas			NC						662
Mill Creek CT			Fossil			Gas/Oil			SC						563
W.S. Lee			Fossil			Gas			SC						170
W.S. Lee CT			Fossil			Gas/Oil			SC						84
Clemson CHP			Fossil			Gas			SC						13
Bad Creek			Hydro			Water			SC						1,520
Jocassee			Hydro			Water			SC						780
Cowans Ford			Hydro			Water			NC						324
Keowee			Hydro			Water			SC						152
Other small facilities (19 plants)			Hydro			Water			NC/SC						581
Distributed generation			Renewable			Solar			NC						71
Total Duke Energy Carolinas															20,081

															Owned MW
Facility			Plant Type			Primary Fuel			Location						Capacity
Duke Energy Progress
Brunswick			Nuclear			Uranium			NC						1,870
Harris			Nuclear			Uranium			NC						964
Robinson			Nuclear			Uranium			SC						759
Roxboro			Fossil			Coal			NC						2,439
Smith CC			Fossil			Gas/Oil			NC						1,083
H.F. Lee CC			Fossil			Gas/Oil			NC						888
Wayne County CT			Fossil			Gas/Oil			NC						822
Smith CT			Fossil			Gas/Oil			NC						772
Mayo			Fossil			Coal			NC						704
L.V. Sutton CC			Fossil			Gas/Oil			NC						607
Asheville CC			Fossil			Gas/Oil			NC						476
Asheville CT			Fossil			Gas/Oil			NC						320
Darlington CT			Fossil			Gas/Oil			SC						234
Weatherspoon CT			Fossil			Gas/Oil			NC						124
L.V. Sutton CT (Black Start)			Fossil			Gas/Oil			NC						84
Blewett CT			Fossil			Oil			NC						52
Walters			Hydro			Water			NC						112
Other small facilities (3)			Hydro			Water			NC						116
Distributed generation			Renewable			Solar			NC						35
Asheville – Rock Hill Battery			Renewable			Storage			NC						7
Total Duke Energy Progress															12,468

PROPERTIES

															Owned MW
Facility			Plant Type			Primary Fuel			Location						Capacity
Duke Energy Florida
Hines CC			Fossil			Gas/Oil			FL						2,061
Citrus County CC			Fossil			Gas			FL						1,610
Crystal River			Fossil			Coal			FL						1,410
Bartow CC			Fossil			Gas/Oil			FL						1,112
Anclote			Fossil			Gas			FL						1,013
Intercession City CT			Fossil			Gas/Oil			FL						931
Osprey CC			Fossil			Gas/Oil			FL						583
DeBary CT			Fossil			Gas/Oil			FL						524
Tiger Bay CC			Fossil			Gas/Oil			FL						193
Bayboro CT			Fossil			Oil			FL						171
Bartow CT			Fossil			Gas/Oil			FL						168
Suwannee River CT			Fossil			Gas			FL						145
University of Florida CoGen CT			Fossil			Gas			FL						44
Distributed generation			Renewable			Solar			FL						323
Total Duke Energy Florida															10,288

															Owned MW
Facility			Plant Type			Primary Fuel			Location						Capacity
Duke Energy Ohio
East Bend			Fossil			Coal			KY						600
Woodsdale CT			Fossil			Gas/Propane			OH						476
Total Duke Energy Ohio															1,076

															Owned MW
Facility			Plant Type			Primary Fuel			Location						Capacity
Duke Energy Indiana
Gibson(c)			Fossil			Coal			IN						2,822
Cayuga(d)			Fossil			Coal/Oil			IN						1,005
Edwardsport			Fossil			Coal			IN						595
Madison CT			Fossil			Gas			OH						566
Wheatland CT			Fossil			Gas			IN						444
Vermillion CT(e)			Fossil			Gas			IN						360
Noblesville CC			Fossil			Gas/Oil			IN						264
Henry County CT			Fossil			Gas/Oil			IN						129
Cayuga CT			Fossil			Gas/Oil			IN						84
Markland			Hydro			Water			IN						54
Distributed generation			Renewable			Solar			IN						11
Camp Atterbury Battery			Renewable			Storage			IN						4
Nabb Battery			Renewable			Storage			IN						4
Crane Battery			Renewable			Storage			IN						4
Total Duke Energy Indiana															6,346

															Owned MW
Totals by Type															Capacity
Total Electric Utilities															50,259
Totals by Plant Type
Nuclear															8,908
Fossil															37,252
Hydro															3,639
Renewable															460
Total Electric Utilities															50,259

PROPERTIES

(a)Jointly owned with North Carolina Municipal Power Agency Number 1, NCEMC and PMPA. Duke Energy Carolinas' ownership is 19.25% of the facility.

(b)Jointly owned with NCEMC. Duke Energy Carolinas' ownership is 87.27% of the facility.

(c)Duke Energy Indiana owns and operates Gibson Station Units 1 through 4 and is a joint owner of unit 5 with WVPA and IMPA. Duke Energy Indiana operates unit 5 and owns 50.05%.

(d)Includes Cayuga Internal Combustion.

(e)Jointly owned with WVPA. Duke Energy Indiana's ownership is 62.5% of the facility.

The following table provides information related to Electric Utilities and Infrastructure's electric transmission and distribution properties as of December 31, 2021.

						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			12,400			6,800			2,600			900			700			1,400
Miles of 13 to 69 kV			8,200			2,900			—			2,200			600			2,500
Total conductor miles of electric transmission lines			31,300			13,000			6,300			5,000			1,700			5,300
Electric Distribution Lines
Miles of overhead lines			173,400			66,600			46,400			25,200			13,300			21,900
Miles of underground line			109,800			40,000			32,600			21,500			6,300			9,400
Total conductor miles of electric distribution lines			283,200			106,600			79,000			46,700			19,600			31,300
Number of electric transmission and distribution substations			3,000			1,200			500			500			500			300

Substantially all of Electric Utilities and Infrastructure'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.

GAS UTILITIES AND INFRASTRUCTURE

Gas Utilities and Infrastructure 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 Gas Utilities and Infrastructure service territories. The following table provides information related to Gas Utilities and Infrastructure's natural gas distribution.

						Duke
			Duke			Energy
			Energy			Ohio			Piedmont
Miles of natural gas distribution and transmission pipelines			34,800			7,500			27,300
Miles of natural gas service lines			27,700			6,500			21,200

PROPERTIES

COMMERCIAL RENEWABLES

The following table provides information related to Commercial Renewables' electric generation facilities as of December 31, 2021. The MW displayed in the table below are based on nameplate capacity.

															Owned MW			Ownership
Facility			Plant Type			Primary Fuel			Location						Capacity			Interest (%)
Commercial Renewables – Wind
Los Vientos (five sites)			Renewable			Wind			TX						465			51		%
Frontier Windpower II(a)			Renewable			Wind			OK						352			100		%
Mesteno(a)			Renewable			Wind			TX						202			100		%
Maryneal(a)			Renewable			Wind			TX						182			100		%
Sweetwater IV			Renewable			Wind			TX						113			47		%
Frontier Windpower			Renewable			Wind			OK						103			51		%
Top of the World			Renewable			Wind			WY						102			51		%
Notrees			Renewable			Wind			TX						78			51		%
Mesquite Creek			Renewable			Wind			TX						54			26		%
Campbell Hill			Renewable			Wind			WY						50			51		%
Ironwood			Renewable			Wind			KS						43			26		%
Sweetwater V			Renewable			Wind			TX						38			47		%
North Allegheny			Renewable			Wind			PA						36			51		%
Laurel Hill			Renewable			Wind			PA						35			51		%
Cimarron II			Renewable			Wind			KS						34			26		%
Kit Carson			Renewable			Wind			CO						26			51		%
Silver Sage			Renewable			Wind			WY						21			51		%
Happy Jack			Renewable			Wind			WY						15			51		%
Shirley			Renewable			Wind			WI						10			51		%
Total Renewables – Wind															1,959

															Owned MW			Ownership
Facility			Plant Type			Primary Fuel			Location						Capacity			Interest (%)
Commercial Renewables – Solar
Holstein(a)			Renewable			Solar			TX						200			100		%
Rambler(a)			Renewable			Solar			TX						200			100		%
North Rosamond(a)			Renewable			Solar			CA						150			100		%
Pflugerville(a)			Renewable			Solar			TX						144			100		%
Lapetus(a)			Renewable			Solar			TX						100			100		%
Conetoe II			Renewable			Solar			NC						80			100		%
Palmer(a)			Renewable			Solar			CO						60			100		%
Broad River(a)			Renewable			Solar			NC						50			100		%
Seville I & II			Renewable			Solar			CA						34			67		%
Rio Bravo I & II			Renewable			Solar			CA						27			67		%
Wildwood I & II			Renewable			Solar			CA						23			67		%
Speedway(a)			Renewable			Solar			NC						23			100		%
Kelford			Renewable			Solar			NC						22			100		%
Dogwood			Renewable			Solar			NC						20			100		%
Halifax Airport			Renewable			Solar			NC						20			100		%
Pasquotank			Renewable			Solar			NC						20			100		%
Shawboro			Renewable			Solar			NC						20			100		%
Caprock			Renewable			Solar			NM						17			67		%
Creswell Alligood			Renewable			Solar			NC						14			100		%
Pumpjack			Renewable			Solar			CA						13			67		%
Longboat			Renewable			Solar			CA						13			67		%
Shoreham(a)			Renewable			Solar			NY						13			51		%
Washington White Post			Renewable			Solar			NC						12			100		%
Whitakers			Renewable			Solar			NC						12			100		%
Highlander I & II			Renewable			Solar			CA						11			51		%
Other small solar(a)			Renewable			Solar			Various						233			Various
Total Renewables – Solar															1,531

PROPERTIES

															Owned MW			Ownership
Facility			Plant Type			Primary Fuel			Location						Capacity			Interest (%)
Commercial Renewables – Fuel Cells(a)			Renewable			Fuel Cell			Various						44			100		%
Total Renewables – Fuel Cells															44

															Owned MW			Ownership
Facility			Plant Type			Primary Fuel			Location						Capacity			Interest (%)
Commercial Renewables – Energy Storage
Notrees Battery Storage			Renewable			Storage			TX						18			51		%
Beckjord Battery Storage			Renewable			Storage			OH						2			100		%
Total Renewables – Energy Storage															20

															Owned MW
Totals by Type															Capacity
Wind															1,959
Solar															1,531
Fuel Cells															44
Energy Storage															20
Total Commercial Renewables**(b)**															3,554

(a) Certain projects, including projects within Other small solar, are in tax-equity structures where investors have differing interests in the project's economic attributes. 100% of the tax-equity project's capacity is included in the table above.

(b) Net proportion of MW capacity in operation is 4,729, which represents the amount managed or owned by Duke Energy.

OTHER

Duke Energy owns approximately 8 million square feet and, after exiting the Duke Energy Center in 2021, leases approximately 1.5 million square feet of corporate, regional and district office space spread throughout its service territories. See Note 10, "Property, Plant and Equipment," for further information.