Form 8-K Duke Energy CORP For: Feb 18

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February 18, 2016 7:07 AM EST

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report

(Date of earliest event reported): February 18, 2016

DUKE ENERGY CORPORATION

(Exact Name of Registrant as Specified in Charter)

Delaware

001-32853

20-2777218

(State or Other Jurisdiction

of Incorporation)

(Commission

File No.)

(IRS Employer

Identification No.)

550 South Tryon Street, Charlotte, North Carolina, 28202

(Address of principal executive offices, including zip code)

(704) 594-6200

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On February 18, 2016, Duke Energy Corporation (the “Company”) issued a news release announcing its financial results for the fourth quarter ended December 31, 2015. A copy of this news release is attached hereto as Exhibit 99.1. The information in Exhibit 99.1 is being furnished pursuant to this Item 2.02.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

In connection with certain awards that may be granted from time to time by the Company under the Duke Energy Corporation 2015 Long-Term Incentive Plan, the Company is filing the Performance Award Agreement and Restricted Stock Unit Award Agreement attached as Exhibits 10.1 and 10.2, respectively, and incorporated by reference into this Item 5.02 as though fully set forth herein.

Item 9.01 Financial Statements and Exhibits

(d)

Exhibits


		10.1		Performance Award Agreement

		10.2		Restricted Stock Unit Award Agreement

		99.1		News Release issued by Duke Energy Corporation on February 18, 2016

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.


DUKE ENERGY CORPORATION

		/s/ BRIAN D. SAVOY
		Brian D. Savoy
		Senior Vice President, Chief Accounting Officer and Controller

Dated: February 18, 2016

EXHIBIT INDEX


Exhibit		Description

10.1		Performance Award Agreement

10.2		Restricted Stock Unit Award Agreement

99.1		News Release issued by Duke Energy Corporation on February 18, 2016

Exhibit 10.1

PERFORMANCE AWARD AGREEMENT

This Performance Award Agreement (the “Agreement”) has been made as of (the “Date of Grant”) between Duke Energy Corporation, a Delaware corporation, with its principal offices in Charlotte, North Carolina (the “Corporation”), and (the “Grantee”).

RECITALS

Under the Duke Energy Corporation 2015 Long-Term Incentive Plan, as it may, from time to time, be further amended (the “Plan”), the Compensation Committee of the Board of Directors of the Corporation (the “Committee”), or its delegatee, has determined the form of this Agreement and selected the Grantee, as an Employee, to receive the award evidenced by this Agreement (the “Award”) and the Performance Shares and tandem Dividend Equivalents that are subject hereto. The applicable provisions of the Plan are incorporated in this Agreement by reference, including the definitions of terms contained in the Plan (unless such terms are otherwise defined herein).

AWARD

In accordance with the Plan, the Corporation has made this Award, effective as of the Date of Grant and upon the following terms and conditions:

Section 1. Number and Nature of Performance Shares and Tandem Dividend Equivalents. At target performance, the number of Performance Shares and the number of tandem Dividend Equivalents subject to this Award are each . Each Performance Share, upon becoming vested, represents a right to receive payment in the form of one (1) share of Common Stock. Each tandem Dividend Equivalent, after its tandem Performance Share vests, represents a right to receive a cash payment equivalent in amount to the aggregate cash dividends declared and paid on one (1) share of Common Stock for the period beginning on the Date of Grant and ending on the date the vested, tandem Performance Share is paid or deferred and before the Dividend Equivalent expires. Performance Shares and Dividend Equivalents are used solely as units of measurement, and are not shares of Common Stock and the Grantee is not, and has no rights as, a shareholder of the Corporation by virtue of this Award.

Section 2. Vesting of Performance Shares.

(a) Performance Goals. Except as otherwise provided in this Section 2, the Performance Shares shall vest only if and to the extent the Committee, or its delegatee, determines that the Performance Goals (as defined below) have been met (provided that such determination shall be made not later than the first March 15 following the end of the Performance Period, as defined below). To the

extent Performance Goals are not met, the Performance Shares that do not so become vested shall be forfeited. The Committee reserves the right to reduce any vesting to the extent the Committee determines that such reduction is equitable and appropriate for any reason, including reductions based on overall financial performance, such as, adjusted and reported earnings, capital deployment and credit position during the Performance Period (as defined below): .

Such Performance Shares that do not so become vested shall be forfeited. If the Committee determines that a merger, consolidation, liquidation, issuance of rights or warrants to purchase securities, recapitalization, reclassification, stock dividend, spin-off, split-off, stock split, reverse stock split or other distribution with respect to the shares of Common Stock, or any similar corporate transaction or event in respect of the Common Stock, the manner in which the Corporation conducts its business, or other events or circumstances render the Performance Goals to be unsuitable, the Committee may, in its sole discretion, and without the consent of the Grantee or any other persons, modify the calculation of the Performance Goals, or any of the related minimum, target or maximum levels of achievement, in whole or in part, as the Committee deems equitable and appropriate to reflect such event; provided, however, that no such action may result in the loss of the otherwise available exemption of the Award under Section 162(m) of the Code.

(b) In the event that, prior to the date that the determination of the achievement of each Performance Goal is made, the Grantee’s continuous employment by the Corporation, including Subsidiaries, terminates, the Performance Shares subject to this Award are thereupon forfeited, except that if such employment terminates (i) upon Retirement (as defined below), (ii) as the result of the Grantee’s death, (iii) as the result of the Grantee’s permanent and total disability within the meaning of Code Section 22(e)(3), (iv) as the result of the termination of such employment by the Corporation, or employing Subsidiary, other than for cause, as determined by the Corporation or employing Subsidiary, in its sole discretion, or (v) as the direct and sole result, as determined by the Corporation, or employing Subsidiary, in its sole discretion, of the divestiture of assets, a business, or a company, by the Corporation or a Subsidiary, then, unless the Committee, or its delegate, in its sole discretion determine that Grantee is in violation of any obligation identified in Section 3, the Performance Shares subject to this Award shall vest upon such determination of the achievement of each Performance Goal, at such vesting percentage determined by the Committee, or its delegatee, in its sole discretion, by prorating on the basis of the portion of the Performance Period that such employment continued while Grantee was entitled to payment of salary (unless such termination occurs after the end of the Performance Period, in which event the number of Performance Shares earned, if any, shall not be prorated). “Retirement” shall mean .

In the event that Grantee is on an employer-approved, personal leave of absence on the date that the determination of the achievement of each Performance Goal is made, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before November 1 of the calendar year immediately following the calendar year in which the Performance Period ends. In the event Grantee does not return to active service from such leave of absence prior to November 1 of the calendar year immediately following the calendar year in which the Performance Period ends, any Performance Shares covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof). Further, in the event that such determination is made and during any portion of the Performance Period the Grantee was on employer-approved, personal leave of absence, the applicable vesting percentage shall be determined by the Committee, or its delegatee, in its sole discretion, to reflect only that portion of the Performance Period during which such employment continued while the Grantee was entitled to payment of salary.

(c) In the event that a Change in Control occurs before the Performance Period has ended and (i) before the Grantee’s continuous employment by the Corporation, including Subsidiaries, terminates, or (ii) after such employment terminates during the Performance Period, (A) at a time when Grantee is considered “retired”, unless the Corporation, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, or (B) as the result of an event listed in items (ii) – (v) of the first sentence of Section 2(b), the Performance Shares subject to this Award shall vest upon such occurrence, at such vesting percentage determined by the Committee, or its delegatee, in its sole discretion, by prorating down, assuming performance at the target level for each Performance Goal, on the basis of the portion of the Performance Period that has elapsed prior to the time of such occurrence (or such earlier termination of employment), and the remaining Performance Shares shall be forfeited, irrespective of any subsequent determination of the achievement of each Performance Goal.

Section 3. Restrictive Covenants.

(a) In consideration of the Award, Grantee agrees that during the period beginning with termination of employment and ending with the anniversary of the Date of Grant (“Restricted Period”), Grantee shall not for any reason, directly or indirectly, without the prior written consent of the Corporation or its delegatee: (i) become employed, engaged or involved with a competitor (defined below) of the Corporation or any Subsidiary in a position that involves: providing services that relate to or are similar in nature or purpose to the services performed by the Grantee for the Corporation or any Subsidiary at any time during his or her previous years of employment with the Corporation or any Subsidiary; or, supervision, management, direction or advice regarding such services; either as principal, agent, manager, employee, partner, shareholder,

director, officer or consultant (other than as a less-than three percent (3%) equity owner of any corporation traded on any national, international or regional stock exchange or in the over-the-counter market); or, (ii) induce or attempt to induce any customer, client, supplier, employee, agent or independent contractor of the Corporation or any of the Subsidiaries to reduce, terminate, restrict or otherwise alter (to the Corporation’s detriment) its business relationship with the Corporation.

(b) The noncompetition obligations of clause (i) of the preceding sentence shall be effective only with respect to a “competitor” of the Corporation or any Subsidiary which is understood to mean any person or entity in competition with the Corporation or any Subsidiary, and more particularly those persons and entities in the businesses of: and any other business in which the Corporation, including Subsidiaries, is engaged at the termination of Grantee’s continuous employment by the Corporation, including Subsidiaries; and within the following geographical areas; . The Corporation and Grantee intend the above restrictions on competition in geographical areas to be entirely severable and independent, and any invalidity or enforceability of this provision with respect to any one or more of such restrictions, including geographical areas, shall not render this provision unenforceable as applied to any one or more of the other restrictions, including geographical areas.

(c) Grantee agrees not to: (i) disclose to any third party or otherwise misappropriate any confidential or proprietary information of the Corporation or of any Subsidiary (except as required by subpoena or other legal process, in which event the Grantee will give the Chief Legal Officer of the Corporation prompt notice of such subpoena or other legal process in order to permit the Corporation or any affected individual to seek appropriate protective orders); or, (ii) publish or provide any oral or written statements about the Corporation or any Subsidiary, any of the Corporation’s or any Subsidiary’s current or former officers, executives, directors, employees, agents or representatives that are false, disparaging or defamatory, or that disclose private or confidential information about their business or personal affairs. The obligations of this paragraph are in addition to, and do not replace, eliminate, or reduce in any way, all other contractual, statutory, or common law obligations Grantee may have to protect the Corporation’s confidential information and trade secrets and to avoid defamation or business disparagement.

(d) Notwithstanding any other provision of Section 3, the Grantee remains free to report or otherwise communicate any nuclear safety concern, any workplace safety concern, or any public safety concern to the Nuclear Regulatory Commission, United States Department of Labor, or any other appropriate governmental agency without providing the notice described in Section 3(c), and the Grantee remains free to participate in any governmental proceeding or investigation without providing the notice described in Section 3(c).

(e) If any part of this Section is held to be unenforceable because of the duration, scope or geographical area covered, the Corporation and Grantee agree to modify such part, or that the court making such holding shall have the power to modify such part, to reduce its duration, scope or geographical area.

(f) Nothing in Section 3 shall be construed to prohibit Grantee from being retained during the Restricted Period in a capacity as an attorney licensed to practice law, or to restrict Grantee from providing advice and counsel in such capacity, in any jurisdiction where such prohibition or restriction is contrary to law.

(g) Grantee’s agreement to the restrictions provided for in this Agreement and the Corporation’s agreement to provide the Award are mutually dependent consideration. Therefore, notwithstanding any other provision to the contrary in this Agreement, if the enforceability of any material restriction on Grantee provided for in this Agreement is challenged and found unenforceable by a court of law then the Corporation shall, at its election, have the right to (i) cancel the Award, (ii) recover from Grantee any shares of Common Stock, Dividend Equivalents or other cash paid under Award, or (iii) with respect to any shares of Common Stock paid under the Award that have been disposed of, require the Grantee to repay to the Corporation the fair market value of such shares of Common Stock on the date such shares were sold, transferred, or otherwise disposed of by Grantee. This provision shall be construed as a return of consideration or ill-gotten gains due to the failure of Grantee’s promises under the Agreement, and not as a liquidated damages clause. Nothing herein shall (i) reduce or eliminate the Corporation’s right to assert that the restrictions provided for in this agreement are fully enforceable as written, or as modified by a court pursuant to Section 3, or (ii) eliminate, reduce, or compromise the application of temporary or permanent injunctive relief as a fully appropriate and applicable remedy to enforce the restrictions provided for in Section 3 (inclusive of its subparts), in addition to recovery of damages or other remedies otherwise allowed by law.

Section 4. Forfeiture. Any Performance Share subject to this Award shall be forfeited upon the termination of the Grantee’s continuous employment by the Corporation, including Subsidiaries, from the Date of Grant, except to the extent otherwise provided in Section 2. Any Dividend Equivalent subject to this Award shall expire at the time its tandem Performance Share (i) is vested and paid, or deferred, or (ii) is forfeited.

Section 5. Dividend Equivalent Payment. Payment with respect to any Dividend Equivalent subject to this Award that is in tandem with a Performance Share that is vested and paid shall be paid in cash to the Grantee at the same time as the vested Performance Share as provided in Section 6, or, if the vested Performance Share is deferred by Grantee as provided in Section 6, payment with respect to the tandem Dividend Equivalent shall likewise be deferred. The

Dividend Equivalent payment amount shall equal the aggregate cash dividends declared and paid with respect to one (1) share of Common Stock for the period beginning on the Date of Grant and ending on the date the vested, tandem Performance Share is paid or deferred and before the Dividend Equivalent expires. However, should the timing of a particular payment under Section 6 to the Grantee in shares of Common Stock in conjunction with the timing of a particular cash dividend declared and paid on Common Stock be such that the Grantee receives such shares without the right to receive such dividend and the Grantee would not otherwise be entitled to payment under the expiring Dividend Equivalent with respect to such dividend, the Grantee, nevertheless, shall be entitled to such payment. Dividend Equivalent payments shall be subject to withholding for taxes. Any required income tax withholdings in respect of Dividend Equivalents attributable to Performance Shares shall be satisfied by reducing the cash payment in respect of the required withholding amount, unless the Committee, or its delegatee, in its discretion, requires Grantee to satisfy such tax obligation by other payment to the Corporation.

Section 6. Payment of Performance Shares. Payment of Performance Shares subject to this Award that become vested shall be made to the Grantee on the earlier of: (i) the calendar year immediately following the Performance Period, or (ii) within 30 days after the occurrence of a “change in the ownership,” a “change in the effective control” or a “change in the ownership of a substantial portion of the assets” of the Corporation within the meaning of Section 409A of the Code, except to the extent deferred by the Grantee in accordance with such procedures as the Committee, or its delegatee, may prescribe from time to time or except to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code. Payment (or deferrals, as applicable) shall be subject to withholding for taxes. Payment shall be in the form of one (1) share of Common Stock for each full vested Performance Share, and any fractional vested Performance Share shall be rounded up to the next whole share for purposes of both vesting under Section 2 and payment under Section 6. Notwithstanding the foregoing, the number of shares of Common Stock that would otherwise be paid or deferred (valued at Fair Market Value on the date the respective Performance Share became vested, or if later, payable) shall be reduced by the Committee, or its delegatee, in its sole discretion, to fully satisfy tax withholding requirements, unless the Committee, or its delegate, in its discretion requires Grantee to satisfy such tax obligation by other payment to the Corporation. In the event that payment, after any reduction in the number of shares of Common Stock to satisfy withholding for tax requirements, would be for less than ten (10) shares of Common Stock, then, if so determined by the Committee, or its delegatee, in its sole discretion, payment, instead of being made in shares of Common Stock, shall be made in a cash amount equal in value to the shares of Common Stock that would otherwise be paid, valued at Fair Market Value on the date the respective Performance Shares became vested.

Section 7. No Employment Right. Nothing in this Agreement or in the Plan shall confer upon the Grantee the right to continued employment with the Corporation or any Subsidiary, or affect the right of the Corporation or any Subsidiary to terminate the employment or service of the Grantee at any time for any reason.

Section 8. Nonalienation. The Performance Shares and Dividend Equivalents subject to this Award are not assignable or transferable by Grantee. Upon any attempt to transfer, assign, pledge, hypothecate, sell or otherwise dispose of any such Performance Share or Dividend Equivalent, or of any right or privilege conferred hereby, or upon the levy of any attachment or similar process upon such Performance Share or Dividend Equivalent, or upon such right or privilege, such Performance Share or Dividend Equivalent, or such right or privilege, shall immediately become null and void.

Section 9. Determinations. Determinations by the Committee, or its delegatee, shall be final and conclusive with respect to the interpretation of the Plan and this Agreement.

Section 10. Governing Law. This Agreement shall be governed, construed and enforced in accordance with the laws of the State of Delaware applicable to transactions that take place entirely within that state.

Section 11. Conflicts with Plan, Correction of Errors, Section 409A and Grantee’s Consent. In the event that any provision of this Agreement conflicts in any way with a provision of the Plan, such Plan provision shall be controlling and the applicable provision of this Agreement shall be without force and effect to the extent necessary to cause such Plan provision to be controlling. In the event that, due to administrative error, this Agreement does not accurately reflect an Award properly granted to the Grantee pursuant to the Plan, the Corporation, acting through its Executive Compensation and Benefits Department, reserves the right to cancel any erroneous document and, if appropriate, to replace the cancelled document with a corrected document. It is the intention of the Corporation and the Grantee that this Award not result in unfavorable tax consequences to Grantee under Code Section 409A. Accordingly, Grantee consents to such amendment of this Agreement as the Corporation may reasonably make in furtherance of such intention, and the Corporation shall promptly provide, or make available to, Grantee a copy of any such amendment.

together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending this Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Corporation shall not be required to assume any increased economic burden. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Grantee shall not be considered to have terminated employment with Corporation for purposes of this Agreement and no payments shall be due to him under this Agreement which are payable upon his termination of employment until he would be considered to have incurred a “separation from service” from the Corporation within the meaning of Section 409A of the Code. To the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Agreement during the six-month period immediately following the Grantee’s termination of employment shall instead be paid within 30 days following the first business day after the date that is six months following his termination of employment (or upon his death, if earlier). In addition, for purposes of this Agreement, each amount to be paid or benefit to be provided to the Grantee pursuant to this Agreement shall be construed as a separate identified payment for purposes of Section 409A of the Code.

Grantee acknowledges and agrees that payments made under this Agreement are subject to the Corporation’s requirement that the Grantee reimburse the portion of any payment where such portion of the payment was (i) inadvertently paid based on an incorrect calculation, or (ii) predicated upon the achievement of financial results that are subsequently the subject of a restatement caused or partially caused by Grantee’s fraud or misconduct.

Section 12. Compliance with Law. The Corporation shall make reasonable efforts to comply with all applicable federal and state securities laws applicable to the Plan and this Award; provided, however, notwithstanding any other provision of this Award, the Corporation shall not be obligated to deliver any shares of Common Stock pursuant to this Award if the delivery thereof would result in a violation of any such law.

Notwithstanding the foregoing, this Award is subject to cancellation by the Corporation in its sole discretion unless the Grantee, by not later than , , has signed a duplicate of this Agreement, in the space provided below, and returned the signed duplicate to the Executive Compensation and Benefits Department - Performance Award [(DEC38C)], Duke Energy Corporation, P. O. Box 1321, Charlotte, NC 28201-1321, which, if, and to the extent, permitted by the Executive Compensation and Benefits Department, may be accomplished by electronic means.

IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed and granted in Charlotte, North Carolina, to be effective as of the Date of Grant.


ATTEST:		DUKE ENERGY CORPORATION

By:		By:
	Corporate Secretary	Its:	Chief Executive Officer

Acceptance of Performance Award

IN WITNESS OF Grantee’s acceptance of this Performance Award and Grantee’s agreement to be bound by the provisions of this Agreement and the Plan, Grantee has signed this Agreement this day of , .

Grantee’s Signature

(print name)

(address)

Exhibit 10.2

RESTRICTED STOCK UNIT AWARD AGREEMENT

This Restricted Stock Unit Award Agreement (the “Agreement”) has been made as of , (the “Date of Grant”) between Duke Energy Corporation, a Delaware corporation, with its principal offices in Charlotte, North Carolina (the “Corporation”), and (the “Grantee”).

RECITALS

Under the Duke Energy Corporation 2015 Long-Term Incentive Plan, as it may, from time to time, be further amended (the “Plan”), the Compensation Committee of the Board of Directors of the Corporation (the “Committee”), or its delegate, has determined the form of this Agreement and selected the Grantee, as an Employee, to receive the award evidenced by this Agreement (the “Award”) and the “Restricted Stock Units” and tandem Dividend Equivalents that are subject hereto. The applicable provisions of the Plan are incorporated in this Agreement by reference, including the definitions of terms contained in the Plan (unless such terms are otherwise defined herein).

AWARD

In accordance with the Plan, the Corporation has made this Award, effective as of the Date of Grant and upon the following terms and conditions:

Section 1. Number and Nature of Restricted Stock Units and Tandem Dividend Equivalents. The number of Restricted Stock Units and the number of tandem Dividend Equivalents subject to this Award are each . Each Restricted Stock Unit, upon becoming vested, represents a right to receive payment in the form of one (1) share of Common Stock. Each tandem Dividend Equivalent represents a right to receive cash payments equivalent to the amount of cash dividends declared and paid on one (1) share of Common Stock after the Date of Grant and before the Dividend Equivalent expires. Restricted Stock Units and Dividend Equivalents are used solely as units of measurement and are not shares of Common Stock, and the Grantee is not, and has no rights as, a shareholder of the Corporation by virtue of this Award.

Section 2. Vesting of Restricted Stock Units. The specified percentage of the Restricted Stock Units subject to this Award, and not previously forfeited, shall vest, with such percentage considered satisfied to the extent such Restricted Stock Units have previously vested, as follows:

(a) Upon Grantee remaining continuously employed by the Corporation, including Subsidiaries, through the specified anniversary of the Date of Grant (each a “Vesting Date”), the percentage of Restricted Stock Units set forth next to such date shall become vested: .

(b) If such employment terminates (i) as the result of Grantee’s death or (ii) as the result of Grantee’s permanent and total disability within the meaning of Code Section 22(e)(3), all Restricted Stock Units subject to this Award, which units have not previously been forfeited or vested, immediately shall become fully vested, unless the Committee or its delegate, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any Restricted Stock Units not previously vested shall be forfeited.

(c) If such employment terminates: [(i) upon Retirement (as defined below)], (ii) as the result of termination of such employment by the Corporation, or employing Subsidiary, other than for cause, as determined by the Committee or its delegate, or (iii) as the direct and sole result, as determined by the Committee or its delegate, in its sole discretion, of the divestiture of assets, a business or a company by the Corporation or a Subsidiary, then, unless the Committee or its delegate, in its sole discretion, determines that Grantee is in violation of any obligation identified in Section 3, in which case any Restricted Stock Units not previously vested shall be forfeited, the Restricted Stock Units subject to this Award shall vest at such vesting percentage determined by the Committee or its delegate, in its sole discretion, by prorating from the above schedule to reflect only that portion of the period beginning on the Date of Grant and ending with the ( ) anniversary of the Date of Grant during which such employment continued while Grantee was entitled to payment of salary, and any such Restricted Stock Units not then or previously vested shall be forfeited. [For purposes of this Agreement, “Retirement” shall mean .]

(d) 100% of the Restricted Stock Units shall become vested, if, following the occurrence of a Change in Control and before the second anniversary of such occurrence, such employment is terminated involuntarily, and not for cause, by the Corporation, or employing Subsidiary, as determined by the Committee or its delegate in its sole discretion.

(e) Unless the Grantee’s right to receive payment of the Restricted Stock Units constitutes a “deferral of compensation” within the meaning of Section 409A of the Code, in the event that at a time when vesting would otherwise occur under Section 2(a), 2(b) or 2(c) Grantee is on an employer-approved, personal leave of absence, then, unless prohibited by law, vesting shall be postponed and shall not occur unless and until Grantee returns to active service in accordance with the terms of the approved personal leave of absence and before January 14 of the calendar year immediately following the calendar year in which the leave commenced. In the event Grantee does not return to active service from such leave of absence prior to January 14 of the calendar year immediately following the calendar year in which the leave commenced, any Restricted Stock Units covered by this Award that were not vested as of the commencement of such leave shall be immediately forfeited (as if Grantee terminated employment for purposes of Section 4 hereof).

Section 3. Restrictive Covenants.

(a) In consideration of the Award, Grantee agrees that during the period ending on the anniversary of the Date of Grant (“Restricted Period”), Grantee shall not for any reason, directly or indirectly, without the prior written consent of the Corporation or its delegate: (i) become employed, engaged or involved with a competitor (defined below) of the Corporation or any Subsidiary in a position that involves: providing services that relate to or are similar in nature or purpose to the services performed by the Grantee for the Corporation or any Subsidiary at any time during his or her previous years of employment with the Corporation or any Subsidiary; or, supervision, management, direction or advice regarding such services; either as principal, agent, manager, employee, partner, shareholder, director, officer or consultant (other than as a less-than three percent (3%) equity owner of any corporation traded on any national, international or regional stock exchange or in the over-the-counter market); or, (ii) induce or attempt to induce any customer, client, supplier, employee, agent or independent contractor of the Corporation or any of the Subsidiaries to reduce, terminate, restrict or otherwise alter (to the Corporation’s detriment) its business relationship with the Corporation.

not replace, eliminate, or reduce in any way, all other contractual, statutory, or common law obligations Grantee may have to protect the Corporation’s confidential information and trade secrets and to avoid defamation or business disparagement.

(d) Notwithstanding any other provision of Section 3, the Grantee remains free to report or otherwise communicate with the Nuclear Regulatory Commission, United States Department of Labor, or any other appropriate governmental agency concerning any nuclear safety, workplace safety or any public safety concern, any potential violations or any other matters within such agency’s regulatory responsibility without providing the notice described in Section 3(c), and the Grantee remains free to participate in any governmental proceeding or investigation without providing the notice described in Section 3(c).

(g) Grantee’s agreement to the restrictions provided for in this Agreement and the Corporation’s agreement to provide the Award are mutually dependent consideration. Therefore, notwithstanding any other provision to the contrary in this Agreement, if Grantee materially breaches any provision of this Section 3 or if the enforceability of any material restriction on Grantee provided for in this Agreement is challenged and found unenforceable by a court of law then the Corporation shall, at its election, have the right to (i) cancel the Award, (ii) recover from Grantee any shares of Common Stock, Dividend Equivalents or other cash paid under Award, or (iii) with respect to any shares of Common Stock paid under the Award that have been disposed of, require the Grantee to repay to the Corporation the fair market value of such shares of Common Stock on the date such shares were sold, transferred, or otherwise disposed of by Grantee. This provision shall be construed as a return of consideration or ill-gotten gains due to the failure of Grantee’s promises under the Agreement, and not as a liquidated damages clause. Nothing herein shall (i) reduce or eliminate the Corporation’s right to assert that the restrictions provided for in this agreement are fully enforceable as written, or as modified by a court pursuant to Section 3, or (ii) eliminate, reduce, or compromise the application of temporary or permanent injunctive relief as a fully appropriate and applicable remedy to enforce the restrictions provided for in Section 3 (inclusive of its subparts), in addition to recovery of damages or other remedies otherwise allowed by law.

Section 4. Forfeiture. Any unvested Restricted Stock Unit subject to this Award shall be forfeited upon the termination of Grantee’s continuous employment by the Corporation, including Subsidiaries, prior to a Vesting Date, except to the extent otherwise provided in Section 2. Any Dividend Equivalent subject to this Award shall expire at the time the Restricted Stock Unit with respect to which the Dividend Equivalent is in tandem (i) is vested and paid, or deferred, or (ii) is forfeited.

Section 5. Dividend Equivalent Payments. Payments with respect to any Dividend Equivalent subject to this Award shall be paid in cash to the Grantee within 60 days after the time cash dividends are declared and paid with respect to the Common Stock on or after the Date of Grant and before the Dividend Equivalent expires, but in no event later than the calendar year in which the dividends are declared and paid. However, should the timing of a particular payment under Section 6 to the Grantee in shares of Common Stock in conjunction with the timing of a particular cash dividend declared and paid on Common Stock be such that the Grantee receives such shares without the right to receive such dividend and the Grantee would not otherwise be entitled to payment under the expiring Dividend Equivalent with respect to such dividend, the Grantee, nevertheless, shall be entitled to such payment. Dividend Equivalent payments shall be subject to withholding for taxes. Any required income tax withholdings in respect of Dividend Equivalents attributable to Restricted Stock Units shall be satisfied by reducing the cash payment in respect of the required withholding amount, unless the Committee, or its delegate, in its discretion, requires Grantee to satisfy such tax obligation by other payment to the Corporation.

Section 6. Payment of Restricted Stock Units. Payment of Restricted Stock Units subject to this Award shall be made to the Grantee as soon as practicable following the time such units become vested in accordance with Section 2 but in no event later than 60 days following such vesting, except to the extent deferred by Grantee in accordance with such procedures as the Committee, or its delegate, may prescribe from time to time or except to the extent required to avoid accelerated taxation and/or tax penalties under Section 409A of the Code. To the extent the Grantee’s right to receive payment of the Restricted Stock Units constitutes a “deferral of compensation” within the meaning of Section 409A of the Code, then notwithstanding the first sentence of this Section 6, except in the event that the Grantee’s employment terminates as a result of death, payment of vested Restricted Stock Units subject to this Award shall be made to the Grantee within 60 days following the applicable Vesting Date(s) as provided in Section 2(a). Payment (or deferrals, as applicable) shall be subject to withholding for taxes. Payment shall be in the form of one (1) share of Common Stock for each full Restricted Stock Unit and any fractional Restricted Stock Unit shall be made in a cash amount equal in value to the shares of Common Stock that would otherwise be paid, valued at Fair Market Value on the date the respective Restricted Stock Units became vested, or if later, payable. Notwithstanding the foregoing, the number of shares of Common Stock that would otherwise be paid or deferred (valued at Fair Market Value on the date the respective Restricted Stock Unit

became vested, or if later, payable) shall be reduced by the Committee, or its delegate, in its sole discretion, to fully satisfy tax withholding requirements, unless the Committee, or its delegate, in its discretion requires Grantee to satisfy such tax obligation by other payment to the Corporation. In the event that payment, after any such reduction in the number of shares of Common Stock to satisfy withholding for tax requirements, would be less than ten (10) shares of Common Stock, then, if so determined by the Committee, or its delegate, in its sole discretion, payment, instead of being made in shares of Common Stock, shall be made in a cash amount equal in value to the shares of Common Stock that would otherwise be paid, valued at Fair Market Value on the date the respective Restricted Stock Units became vested, or if later, payable.

Section 7. No Employment Rights. Nothing in this Agreement or in the Plan shall confer upon the Grantee the right to continued employment by the Corporation or any Subsidiary, or affect the right of the Corporation or any Subsidiary to terminate the employment or service of the Grantee at any time for any reason.

Section 8. Nonalienation. The Restricted Stock Units and Dividend Equivalents subject to this Award are not assignable or transferable by the Grantee. Upon any attempt to transfer, assign, pledge, hypothecate, sell or otherwise dispose of any such Restricted Stock Unit or Dividend Equivalent, or of any right or privilege conferred hereby, or upon the levy of any attachment or similar process upon such Restricted Stock Unit or Dividend Equivalent, or upon such right or privilege, such Restricted Stock Unit or Dividend Equivalent or right or privilege, shall immediately become null and void.

Section 9. Determinations. Determinations by the Committee, or its delegate, shall be final and conclusive with respect to the interpretation of the Plan and this Agreement.

Section 10. Governing Law. The validity and construction of this Agreement shall be governed by the laws of the state of Delaware applicable to transactions taking place entirely within that state.

Section 11. Conflicts with Plan, Correction of Errors, Section 409A and Grantee’s Consent. In the event that any provision of this Agreement conflicts in any way with a provision of the Plan, such Plan provision shall be controlling and the applicable provision of this Agreement shall be without force and effect to the extent necessary to cause such Plan provision to be controlling. In the event that, due to administrative error, this Agreement does not accurately reflect a Restricted Stock Unit Award properly granted to Grantee pursuant to the Plan, the Corporation, acting through its Executive Compensation and Benefits Department, reserves the right to cancel any erroneous document and, if appropriate, to replace the cancelled document with a corrected document. It is the intention of the Corporation and the Grantee that this Award not result in unfavorable tax consequences to Grantee under Code Section 409A. Accordingly, Grantee

consents to such amendment of this Agreement as the Corporation may reasonably make in furtherance of such intention, and the Corporation shall promptly provide, or make available to, Grantee a copy of any such amendment.

To the extent applicable, it is intended that this Agreement comply with the provisions of Section 409A of the Code and that this Award not result in unfavorable tax consequences to Grantee under Section 409A of the Code. This Agreement will be administered and interpreted in a manner consistent with this intent, and any provision that would cause this Agreement to fail to satisfy Section 409A of the Code will have no force and effect until amended to comply therewith (which amendment may be retroactive to the extent permitted by Section 409A of the Code). The Corporation and the Grantee agree to work together in good faith in an effort to comply with Section 409A of the Code including, if necessary, amending this Agreement based on further guidance issued by the Internal Revenue Service from time to time, provided that the Corporation shall not be required to assume any increased economic burden. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, the Grantee shall not be considered to have terminated employment with Corporation for purposes of this Agreement and no payments shall be due to him or her under this Agreement which are payable upon his or her termination of employment until he or she would be considered to have incurred a “separation from service” from the Corporation within the meaning of Section 409A of the Code. To the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Agreement during the six-month period immediately following the Grantee’s termination of employment shall instead be paid within 60 days following the first business day after the date that is six months following his or her termination of employment (or upon his or her death or a regularly scheduled Vesting Date, if earlier). In addition, for purposes of this Agreement, each amount to be paid or benefit to be provided to the Grantee pursuant to this Agreement shall be construed as a separate identified payment for purposes of Section 409A of the Code.

Notwithstanding the foregoing, this Award is subject to cancellation by the Corporation in its sole discretion unless the Grantee, by not later than , , has signed a duplicate of this Agreement, in the space provided below, and returned the signed duplicate to the Executive Compensation and Benefits Department – Restricted Stock Units [(DEC38C)], Duke Energy Corporation, P. O. Box 1321, Charlotte, NC 28201-1321, which, if, and to the extent, permitted by the Executive Compensation and Benefits Department, may be accomplished by electronic means.

IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed and granted in Charlotte, North Carolina, to be effective as of the Date of Grant.


DUKE ENERGY CORPORATION

By:
Its:

Acceptance of Restricted Stock Unit Award

IN WITNESS OF Grantee’s acceptance of this Award and Grantee’s agreement to be bound by the provisions of this Agreement and the Plan, Grantee has signed this Agreement this day of , .

Grantee’s Signature

(print name)

(address)

Exhibit 99.1

LOGO

Media Contact: Tom Shiel

24-Hour: 800.559.3853

Analysts: Bill Currens

Office: 704.382.1603

Feb. 18, 2016

Duke Energy reports 2015 adjusted EPS and introduces 2016 adjusted EPS guidance range

•

Company achieves adjusted diluted earnings per share (EPS) of $4.54 in 2015, compared to $4.55 in 2014; reported diluted EPS of $4.05 for 2015, compared to $2.66 in 2014

•

Record mild December weather results in fourth quarter 2015 adjusted diluted EPS of 87 cents, compared to 86 cents for the fourth quarter 2014; fourth quarter 2015 reported diluted EPS of 69 cents, compared to 14 cents in 2014

•

Company establishes 2016 adjusted diluted EPS guidance range of $4.50 to $4.70

CHARLOTTE, N.C. – Duke Energy today announced 2015 full-year adjusted diluted EPS of $4.54 compared to $4.55 in 2014. Duke Energy’s full-year 2015 reported diluted EPS was $4.05, compared to $2.66 in 2014.

Full year adjusted results were driven by strong operational performance in the regulated business as well as benefits from closing certain strategic initiatives earlier than anticipated, helping offset weakness at International.

Fourth quarter 2015 adjusted diluted EPS was 87 cents, compared to 86 cents for fourth quarter 2014. Fourth quarter 2015 reported diluted EPS was 69 cents, compared to 14 cents for fourth quarter 2014.

Fourth quarter adjusted results were supported by increased retail pricing and wholesale margins in the regulated business, helping to offset the impact of record mild December weather in the Carolinas.

Reported diluted EPS includes the impact of special items, which are excluded from adjusted diluted EPS. Special items during 2015 principally included charges associated with a settlement in Indiana related to the ongoing Edwardsport IGCC regulatory proceedings, severance related to cost savings initiatives, and merger costs-to-achieve.


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Special items during 2014 principally included charges related to the company’s intent to repatriate $2.7 billion of foreign earnings, a settlement resolving the federal grand jury investigation into the company’s coal ash basin operations, and merger costs-to-achieve.

“I am pleased with our strong execution at the regulated utilities during 2015, underpinned by exceptional operational performance,” said Lynn Good, chairman, president and chief executive officer. “The dedication by our employees helped us meet growing customer peak demand as well as achieve industry-leading safety performance during the year.

“We also successfully completed several strategic transactions, increasing our focus on our core regulated and highly contracted businesses. This focus positions us for evolving customer expectations and a desire for lower carbon, more flexible generation resources while supporting greater stability in earnings and cash flows for our investors,” Good said.

The company has established its 2016 adjusted diluted EPS guidance range at $4.50 to $4.70.

Business unit results

In addition to the summary business unit discussion below, comprehensive tables of quarterly and year-to-date adjusted earnings per share drivers compared to the prior year are provided on pages 17 and 18.

The discussion below of fourth-quarter and full-year results includes adjusted segment income, which is a non-GAAP financial measure. The tables on pages 27 through 30 present a reconciliation of reported results to adjusted results. Per share segment variances highlighted below exclude the benefit of the $1.5 billion accelerated stock repurchase program that was completed in June.

Regulated Utilities

Regulated Utilities recognized fourth quarter 2015 adjusted segment income of $601 million, compared to $551 million in the fourth quarter 2014, an increase of 7 cents per share. These results were driven by:

•

Increased pricing and riders (+$0.09 per share) as a result of increased riders, including a favorable Ohio energy efficiency settlement

•

Higher wholesale net margins (+$0.05 per share) due to new and updated contracts, including earnings from the long-term wholesale contract associated with the recent North Carolina Eastern Municipal Power Agency (NCEMPA) asset purchase

•

Increased weather-normal retail volumes (+$0.04 per share)


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These favorable drivers were partially offset by:

•

Record breaking mild winter weather (-$0.12 per share), principally in the Carolinas and Midwest

Full-year 2015 adjusted segment income for Regulated Utilities was $2,972 million, compared to $2,897 million in 2014, an increase of 10 cents per share.

Increased year-to-date results at Regulated Utilities were primarily driven by:

•

Higher revenues from increased pricing and riders (+$0.23 per share) due to increased energy efficiency programs and fuel and purchased power cost true-ups

•

Increased wholesale net margins (+$0.16 per share) due to new and updated contracts including earnings from the long-term wholesale contract associated with the recent NCEMPA asset purchase

•

Increased weather-normal retail volumes (+$0.07 per share) of 0.6 percent compared to the prior year

These favorable drivers were partially offset by:

•

Higher O&M expense (-$0.18 per share) due to higher planned outages, increased costs related to the recent NCEMPA asset purchase and nuclear outage cost levelization. These costs were partially offset by lower storm costs

•

Higher depreciation and amortization expense (-$0.13 per share) primarily resulting from additional plant in-service, including the NCEMPA assets

International Energy

International Energy recognized fourth quarter 2015 adjusted segment income of $68 million, compared to $72 million in the fourth quarter 2014, which was flat on a per share basis. These results were driven by:

•

Lower margins at National Methanol (-$0.03 per share) due to lower MTBE and methanol prices

These unfavorable drivers were partially offset by:

•

Stronger results in Brazil (+$0.02 per share) due to lower purchased power costs partially offset by unfavorable foreign currency exchange rates

Full-year 2015 adjusted segment income for International Energy was $225 million, compared to $428 million in 2014, a decrease of 29 cents per share.


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International Energy’s lower year-to-date adjusted earnings were driven by:

•

Weaker results in Brazil (-$0.10 per share) primarily due to lower sales volumes and higher purchased power costs resulting from ongoing drought conditions and decreased demand in Brazil as well as unfavorable foreign currency exchange rates

•

Lower results in Central America (-$0.04 per share) primarily due to lower generation and prices from increased competition

•

Absence of a prior-year tax benefit in Chile (-$0.07 per share)

•

Lower margins at National Methanol (-$0.07 per share) largely driven by lower MTBE and methanol prices

Commercial Portfolio

Subsequent to the sale of its nonregulated Midwest Commercial Generation Business to Dynegy Inc. in April 2015, Commercial Portfolio (formerly Commercial Power) includes Duke Energy’s unregulated renewable assets as well as its commercial electric and gas transmission investments.

Commercial Portfolio recognized fourth quarter 2015 adjusted segment income of $41 million, compared to $32 million in the fourth quarter 2014, an increase of 1 cent per share. The increase in Commercial Portfolio’s quarterly earnings was primarily due to additional in-service wind and solar facilities in the renewables portfolio (+$0.03 per share), offset by the absence of earnings from the Midwest generation business (-$0.01 per share), which was sold in April.

Full-year 2015 adjusted segment income for Commercial Portfolio was $140 million, compared to $109 million in 2014, an increase of 4 cents per share. This increase was primarily due to higher results from the Midwest generation business (+$0.04 per share), which was sold in April, and increased earnings from the renewables portfolio due to additional in-service wind and solar facilities despite lower wind resources during the year (+$0.01 per share).

Other

On an adjusted basis, Other primarily includes corporate interest expense not allocated to the business units, results from Duke Energy’s captive insurance company, other investments, and quarterly income tax levelization adjustments.

Other recognized a fourth quarter 2015 adjusted net expense of $108 million, compared to net expense of $45 million in the fourth quarter 2014, additional expense of 9 cents per share. Other’s quarterly results were primarily driven by higher income tax expense (-$0.07 per share) due to impacts from the extension of bonus depreciation and quarterly tax levelization adjustments, including renewable tax credits which were allocated to Commercial Portfolio upon completion of the projects.


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On a year-to-date basis, Other recognized adjusted net expense of $185 million, compared to $216 million for 2014, an improvement of 5 cents per share. Other’s year-to-date results were primarily driven by favorable income taxes (+$0.07 per share) due to favorable tax structuring and settlements.

On a consolidated basis, the company experienced a fourth-quarter 2015 adjusted effective tax rate of approximately 31 percent, compared to approximately 30 percent in the prior year. The company experienced an adjusted effective tax rate of approximately 32 percent for full-year 2015, consistent with the rate in 2014. Adjusted effective tax rate is a non-GAAP financial measure. The tables on pages 31 and 32 present a reconciliation of reported effective tax rate to adjusted effective tax rate.

Accelerated stock repurchase program

In connection with the transaction to sell the Midwest Generation business to Dynegy for $2.8 billion, which closed in April 2015, Duke Energy completed a $1.5 billion accelerated stock repurchase (ASR). The ASR resulted in retirements of approximately 19.8 million shares, providing a benefit to the fourth quarter 2015 and year-to-date results of approximately 2 cents per share and 9 cents per share, respectively.

Earnings Conference Call for Analysts

An earnings conference call for analysts is scheduled for 10 a.m. ET today to provide financial and other business updates. The conference call will be hosted by Lynn Good, president and chief executive officer, and Steve Young, executive vice president and chief financial officer.

The call can be accessed via the investors’ section (http://www.duke-energy.com/investors/) of Duke Energy’s website or by dialing 877-719-9786 in the United States or 719-325-4768 outside the United States. The confirmation code is 8694980. Please call in 10 to 15 minutes prior to the scheduled start time.

A replay of the conference call will be available until 1 p.m. ET, Feb. 28, 2016, by calling 888-203-1112 in the United States or 719-457-0820 outside the United States and using the code 8694980. A replay and transcript also will be available by accessing the investors’ section of the company’s website.


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Special Items and Non-GAAP Reconciliation

Special items affecting Duke Energy’s adjusted diluted EPS for quarterly and full-year results in 2015 and 2014 include:


(In millions, except per-share amounts)	After-Tax Amount			4Q2015 EPS Impact			4Q2014 EPS Impact
Fourth Quarter 2015
• Cost savings initiatives	$	(88	)	$	(0.13	)
• Costs to achieve, mergers	$	(18	)	$	(0.03	)
• Ash basin settlement and penalties	$	(7	)	$	(0.01	)
• Edwardsport settlement	$	(2	)	$	—
• Economic hedges (mark-to-market)	$	(1	)	$	—
• Discontinued operations	$	(9	)	$	(0.01	)
Fourth Quarter 2014
• International tax adjustment	$	(373	)				$	(0.53	)
• Litigation reserve	$	(102	)				$	(0.14	)
• Costs to achieve, mergers	$	(20	)				$	(0.03	)
• Discontinued operations ⁽¹⁾⁽²⁾	$	(18	)				$	(0.02	)

Total diluted EPS impact				$	(0.18	)	$	(0.72	)

(1)	Reported discontinued operations includes the Midwest generation impairment, the economic hedges (mark-to-market) of Midwest generation, and operating results of the Midwest generation business

(2)

Represents the Midwest generation operation results reported as discontinued operations of $(0.04) per diluted share, partially offset by tax benefit related to the sale but not reported as discontinued operations of $0.02 per diluted share, which are treated as a special item and reflected in adjusted diluted EPS.


(In millions, except per-share amounts)	After-Tax Amount			2015 EPS Impact			2014 EPS Impact
Full-Year 2015
• Cost savings initiatives	$	(88	)	$	(0.13	)
• Costs to achieve, mergers	$	(60	)	$	(0.09	)
• Edwardsport settlement	$	(58	)	$	(0.08	)
• Ash basin settlement and penalties	$	(11	)	$	(0.02	)
• Discontinued operations ⁽¹⁾⁽²⁾	$	(119	)	$	(0.17	)
Full-Year 2014
• International tax adjustment	$	(373	)				$	(0.53	)
• Costs to achieve, mergers	$	(127	)				$	(0.18	)
• Litigation reserve	$	(102	)				$	(0.14	)
• Asset impairments	$	(59	)				$	(0.08	)
• Economic hedges (mark-to-market)	$	(6	)				$	(0.01	)
• Asset sales	$	9					$	0.01
• Discontinued operations ⁽¹⁾⁽³⁾	$	(677	)				$	(0.96	)

Total diluted EPS impact				$	(0.49	)	$	(1.89	)

(1)	Reported discontinued operations includes the Midwest generation impairment, the economic hedges (mark-to-market) of Midwest generation, and operating results of the Midwest generation business


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(2)

Represents reported income from discontinued operations of $0.03 per diluted share, including the impact of a litigation reserve related to the Midwest generation business, less the Midwest generation operation results reported as discontinued operations of $(0.14) per diluted share and a tax charge resulting from the completion of the sale of the Midwest generation business but not reported as discontinued operations ($0.06).

(3)

Represents reported loss from discontinued operations of $(0.80) per diluted share, the Midwest generation operation results reported as discontinued operations of $(0.16) per diluted share, and elimination entries of $(0.02) per diluted share, partially offset by tax benefit related to the sale but not reported as discontinued operations of $0.02 per diluted share, which are treated as a special item and reflected in adjusted diluted EPS.

Reconciliation of reported to adjusted diluted EPS for the quarter:


	4Q2015 EPS		4Q2014 EPS
Diluted EPS, as reported	$	0.69	$	0.14

Adjustments to reported EPS:
• Diluted EPS impact of special items and discontinued operations (net of tax)	$	0.18	$	0.72

Diluted EPS, adjusted	$	0.87	$	0.86

Reconciliation of reported to adjusted diluted EPS for the year:


	2015 EPS		2014 EPS

Diluted EPS, as reported	$	4.05	$	2.66

Adjustments to reported EPS:
• Diluted EPS impact of special items and discontinued operations (net of tax)	$	0.49	$	1.89

Diluted EPS, adjusted	$	4.54	$	4.55

Non-GAAP financial measures

Management evaluates financial performance in part based on the non-GAAP financial measures, adjusted earnings and adjusted diluted earnings per share (EPS). These items are measured as income from continuing operations net of income (loss) attributable to non-controlling interests, adjusted for the dollar and per-share impact of mark-to-market impacts of economic hedges in the Commercial Portfolio segment and special items including the operating results of the Midwest Generation business (Disposal Group) classified as discontinued operations for GAAP purposes. Special items represent certain charges and credits, which management believes will not be recurring on a regular basis, although it is reasonably possible such charges and credits could recur. Operating results of the Disposal Group sold to Dynegy are reported as discontinued operations, including a portion of the mark-to-market adjustments associated with derivative contracts. Management believes that including the operating results of the Disposal Group reported as discontinued operations better reflects its financial performance and therefore has included these results in adjusted earnings and adjusted diluted EPS prior to the sale of the Disposal Group. Additionally, as a result of


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completing the sale of the Disposal Group during the second quarter of 2015, state income tax expense increased as state income tax apportionments changed. The additional tax expense was recognized in Continuing Operations on a GAAP basis. This impact to state income taxes has been reflected in Discontinued Operations in the Commercial Portfolio segment for adjusted diluted EPS purposes as management believes these impacts are incidental to the sale of the Disposal Group. Derivative contracts are used in Duke Energy’s hedging of a portion of the economic value of its generation assets in the Commercial Portfolio segment. The mark-to-market impact of derivative contracts is recognized in GAAP earnings immediately and, if associated with the Disposal Group, classified as discontinued operations, as such derivative contracts do not qualify for hedge accounting or regulatory treatment. The economic value of generation assets is subject to fluctuations in fair value due to market price volatility of input and output commodities (e.g. coal, electricity, natural gas). Economic hedging involves both purchases and sales of those input and output commodities related to generation assets. Operations of the generation assets are accounted for under the accrual method. Management believes excluding impacts of mark-to-market changes of the derivative contracts from adjusted earnings until settlement better matches the financial impacts of the derivative contract with the portion of economic value of the underlying hedged asset. Management believes the presentation of adjusted earnings and adjusted diluted EPS provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy’s performance across periods. Management uses these non-GAAP financial measures for planning and forecasting and for reporting results to the Board of Directors, employees, shareholders, analysts and investors concerning Duke Energy’s financial performance. Adjusted diluted EPS is also used as a basis for employee incentive bonuses. The most directly comparable GAAP measures for adjusted earnings and adjusted diluted EPS are Net Income Attributable to Duke Energy Corporation and Diluted EPS Attributable to Duke Energy Corporation common shareholders, which include the dollar and per share impact of special items, mark-to-market impacts of economic hedges in the Commercial Portfolio segment and discontinued operations.

Management evaluates segment performance based on segment income. Segment income is defined as income from continuing operations net of income attributable to non-controlling interests. Segment income, as discussed below, includes intercompany revenues and expenses that are eliminated in the Consolidated Financial Statements. Management also uses adjusted segment income as a measure of historical and anticipated future segment performance. Adjusted segment income is a non-GAAP financial measure, as it is based upon segment income adjusted for the mark-to-market impacts of economic hedges in the Commercial Portfolio segment and special items, including the operating results of the Disposal Group classified as discontinued operations for GAAP purposes. Management believes the presentation of adjusted segment income as presented provides useful information to investors, as it provides


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them with an additional relevant comparison of a segment’s performance across periods. The most directly comparable GAAP measure for adjusted segment income is segment income, which represents segment income from continuing operations, including any special items and the mark-to-market impacts of economic hedges in the Commercial Portfolio segment.

Due to the forward-looking nature of any forecasted adjusted earnings guidance, information to reconcile this non-GAAP financial measure to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items or mark-to-market adjustments for future periods.

Due to the forward-looking nature of any forecasted adjusted segment income or adjusted Other net expenses and any related growth rates for future periods, information to reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures is not available at this time, as the company is unable to forecast all special items, the mark-to-market impacts of economic hedges in the Commercial Portfolio segment, or any amounts that may be reported as discontinued operations or extraordinary items for future periods.

Duke Energy is the largest electric power holding company in the United States. Its regulated utility operations serve approximately 7.3 million electric customers located in six states in the Southeast and Midwest, representing a population of approximately 23 million people. Its Commercial Portfolio and International business segments own and operate diverse power generation assets in North America and Latin America, including a growing portfolio of renewable energy assets in the United States.

Headquartered in Charlotte, N.C., Duke Energy is a Fortune 250 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com.

Follow Duke Energy on Twitter, LinkedIn and Facebook.

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: state, federal and foreign legislative and regulatory initiatives, including costs of compliance with existing and future environmental requirements or climate change, as


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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 regulations related to coal ash, including amounts for the required closure of certain ash basins, are uncertain and difficult to estimate; the ability to recover eligible costs, including amounts associated with coal ash basin asset retirement obligations and future significant weather events, and earn an adequate return on investment through the regulatory process; the costs of decommissioning Crystal River Unit 3 and other nuclear facilities could prove to be more extensive than amounts estimated and all costs may not be fully recoverable through the regulatory process; credit ratings of the company or its subsidiaries may be different from what is expected; costs and effects of legal and administrative proceedings, settlements, investigations and claims; industrial, commercial and residential growth or decline in service territories or customer bases resulting from variations in customer usage patterns, including energy efficiency efforts and use of alternative energy sources, including self-generation and distributed generation technologies; advancements in technology; additional competition in electric markets and continued industry consolidation; political, economic and regulatory uncertainty in Brazil and other countries in which Duke Energy conducts business; 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; 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 U.S. electric grid or generating resources; the impact on facilities and business from a terrorist attack, cybersecurity threats, data security breaches, and other catastrophic events such as fires, explosions, pandemic health events or other similar occurrences; the inherent risks associated with the operation and potential construction of nuclear facilities, including environmental, health, safety, regulatory and financial risks; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange 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 and general economic conditions; 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 Duke Energy and its subsidiaries’ 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


Duke Energy News Release		11

related to obligations created by the default of other participants; the ability to control operation and maintenance costs; the level of creditworthiness of counterparties to transactions; 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 potential goodwill impairments; the ability to reinvest prospective undistributed earnings of foreign subsidiaries or repatriate such earnings on a tax-efficient basis; the expected timing and likelihood of completion of the proposed acquisition of Piedmont Natural Gas Company, Inc. (Piedmont), including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the proposed acquisition that could reduce anticipated benefits or cause the parties to abandon the acquisition, and under certain specified circumstance pay a termination fee of $250 million, as well as the ability to successfully integrate the businesses and realize anticipated benefits and the risk that the credit ratings of the combined company or its subsidiaries may be different from what the companies expect; and the ability to successfully complete future merger, acquisition or divestiture plans.

Additional risks and uncertainties are identified and discussed in Duke Energy’s and its subsidiaries’ reports filed with the SEC and available at the SEC’s website at www.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; Duke Energy expressly disclaims an obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

###

December 2015

QUARTERLY HIGHLIGHTS

(Unaudited)


	Three Months Ended December 31,						Year Ended December 31,
(In millions, except per-share amounts and where noted)	2015			2014			2015			2014
Earnings Per Share - Basic and Diluted
Income from continuing operations attributable to Duke Energy Corporation common stockholders
Basic	$	0.70		$	0.14		$	4.02		$	3.46
Diluted	$	0.70		$	0.14		$	4.02		$	3.46
(Loss) Income from discontinued operations attributable to Duke Energy Corporation common stockholders
Basic	$	(0.01	)	$	—		$	0.03		$	(0.80	)
Diluted	$	(0.01	)	$	—		$	0.03		$	(0.80	)
Net income attributable to Duke Energy Corporation common stockholders
Basic	$	0.69		$	0.14		$	4.05		$	2.66
Diluted	$	0.69		$	0.14		$	4.05		$	2.66
Weighted-average shares outstanding
Basic		688			707			694			707
Diluted		688			707			694			707

SEGMENT INCOME (LOSS) BY BUSINESS SEGMENT
Regulated Utilities^(a)(b)	$	582		$	449		$	2,893		$	2,795
International Energy^(c)		68			(301	)		225			55
Commercial Portfolio^(d)(e)		39			15			4			(55	)

Total Reportable Segment Income		689			163			3,122			2,795
Other Net Expense^(f)(g)(h)		(203	)		(65	)		(322	)		(334	)
Intercompany Eliminations		—			(3	)		(4	)		(10	)
(Loss) Income from Discontinued Operations, net of tax ⁽ⁱ⁾		(9	)		2			20			(568	)

Net Income Attributable to Duke Energy Corporation	$	477		$	97		$	2,816		$	1,883


CAPITALIZATION
Total Common Equity								48	%		49	%
Total Debt								52	%		51	%

Total Debt							$	43,202		$	42,382
Book Value Per Share							$	57.78		$	57.82
Actual Shares Outstanding								688			707

CAPITAL AND INVESTMENT EXPENDITURES
Regulated Utilities ^(j)	$	1,762		$	1,387		$	6,974		$	4,744
International Energy		12			27			45			67
Commercial Portfolio		374			231			1,131			555
Other		47			47			213			162

Total Capital and Investment Expenditures	$	2,195		$	1,692		$	8,363		$	5,528

(a)	Includes a charge of $58 million related to the Edwardsport settlement for the year ended December 31, 2015 (net of tax of $35 million).

(b)	Includes a litigation reserve of $102 million for the three months and year ended December 31, 2014, related to the federal grand jury investigation of the February 2014 Dan River coal ash spill and ash basin operations at other North Carolina coal plants.

(c)	Includes a tax adjustment of $373 million for the three months and year ended December 31, 2014, related to deferred tax impacts resulting from a dividend declaration of International Energy’s historical undistributed earnings.

(d)	Includes a tax charge of $41 million for the year ended December 31, 2015, resulting from the completion of the sale of the nonregulated Midwest generation business.

(e)	Includes an impairment charge of $59 million for the year ended December 31, 2014, related to OVEC (net of tax of $35 million).

(f)	Includes a charge of $77 million for the three months and year ended December 31, 2015, related to cost savings initiatives (net of tax of $47 million).

(g)	Includes costs to achieve mergers of $18 million for the three months ended December 31, 2015 (net of tax of $12 million) and $60 million for the year ended December 31, 2015 (net of tax of $37 million).

(h)	Includes costs to achieve mergers of $20 million for the three months ended December 31, 2014 (net of tax of $13 million) and $127 million for the year ended December 31, 2014 (net of tax of $78 million).

(i)	Includes the impact of a settlement agreement related to the nonregulated Midwest generation business of $53 million for the year ended December 31, 2015 (net of tax of $28 million).

(j)	Includes $1.25 billion related to the NCEMPA acquisition for the year ended December 31, 2015.

December 2015

QUARTERLY HIGHLIGHTS

(Unaudited)


	Three Months Ended						Year Ended
	December 31,						December 31,
(In millions, except for GWh and MW amounts)	2015			2014			2015			2014
REGULATED UTILITIES
Operating Revenues	$	4,972		$	5,197		$	22,062		$	22,271
Operating Expenses^(a)(b)		3,909			4,219			16,698			17,026
Gains on Sales of Other Assets, net		1			2			11			4

Operating Income		1,064			980			5,375			5,249
Other Income and Expenses		75			61			262			267
Interest Expense		268			277			1,097			1,093

Income Before Income Taxes		871			764			4,540			4,423
Income Tax Expense^(c)		289			315			1,647			1,628

Segment Income	$	582		$	449		$	2,893		$	2,795


Depreciation and Amortization	$	718		$	684		$	2,814		$	2,759

INTERNATIONAL ENERGY
Operating Revenues	$	247		$	306		$	1,088		$	1,417
Operating Expenses		166			247			805			1,007
Gains (Losses) on Sales of Other Assets, net		7			(1	)		6			6

Operating Income		88			58			289			416
Other Income and Expenses		32			38			101			190
Interest Expense		19			22			85			93

Income Before Income Taxes		101			74			305			513
Income Tax Expense^(d)		30			375			74			449
Less: Income Attributable to Noncontrolling Interests		3			—			6			9

Segment Income (Loss)	$	68		$	(301	)	$	225		$	55


Depreciation and Amortization	$	23		$	23		$	92		$	97

Sales, GWh		5,631			4,815			19,211			18,629
Proportional MW Capacity in Operation								4,333			4,340

COMMERCIAL PORTFOLIO
Operating Revenues	$	87		$	60		$	301		$	255
Operating Expenses^(e)		98			86			353			441
(Losses) Gains on Sales of Other Assets, net		(5	)		—			1			—

Operating Loss		(16	)		(26	)		(51	)		(186	)
Other Income and Expenses		9			3			6			18
Interest Expense		11			17			44			58

Loss Before Income Taxes		(18	)		(40	)		(89	)		(226	)
Income Tax Benefit^(f)(g)		(57	)		(55	)		(92	)		(171	)
Less: Loss Attributable to Noncontrolling Interests		—			—			(1	)		—

Segment Income (Loss)	$	39		$	15		$	4		$	(55	)


Depreciation and Amortization	$	27		$	22		$	104		$	92

Actual Coal-fired Plant Production, GWh		—			—			—			867
Actual Renewable Plant Production, GWh		1,664			1,350			5,577			5,462

Actual Plant Production, GWh		1,664			1,350			5,577			6,329

Net Proportional MW Capacity in Operation								1,943			1,370

OTHER
Operating Revenues	$	45		$	26		$	123		$	105
Operating Expenses^(h)(i)(j)		205			53			382			322
Gains on Sales of Other Assets, net		1			4			17			6

Operating Loss		(159	)		(23	)		(242	)		(211	)
Other Income and Expenses		12			12			20			45
Interest Expense		108			98			393			400

Loss Before Income Taxes		(255	)		(109	)		(615	)		(566	)
Income Tax Benefit^(k)(l)(m)		(54	)		(47	)		(303	)		(237	)
Less: Income Attributable to Noncontrolling Interests		2			3			10			5

Segment Net Expense	$	(203	)	$	(65	)	$	(322	)	$	(334	)


Depreciation and Amortization	$	35		$	32		$	134		$	118

(a)	Includes a pretax charge of $93 million for the year ended December 31, 2015, related to the Edwardsport settlement.

(b)	Includes a litigation reserve of $102 million for the three months and year ended December 31, 2014, related to the federal grand jury investigation of the February 2014 Dan River coal ash spill and ash basin operations at other North Carolina coal plants.

(c)	Includes a tax benefit of $35 million for the year ended December 31, 2015, related to the Edwardsport settlement.

(d)	Includes a tax adjustment of $373 million for the three months and year ended December 31, 2014, related to deferred tax impacts resulting from a dividend declaration of International Energy’s historical undistributed earnings.

(e)	Includes a pretax impairment charge of $94 million for the year ended December 31, 2014, related to OVEC.

(f)	Includes a tax charge of $41 million for the year ended December 31, 2015, resulting from the completion of the sale of the nonregulated Midwest generation business.

(g)	Includes a tax benefit of $35 million for the year ended December 31, 2014, related to OVEC.

(h)	Includes a charge of $124 million for the three months and year ended December 31, 2015, related to cost savings initiatives.

(i)	Includes costs to achieve mergers of $30 million for the three months ended December 31, 2015, and $97 million for the year ended December 31, 2015.

(j)	Includes costs to achieve mergers of $33 million for the three months ended December 31, 2014, and $198 million for the year ended December 31, 2014.

(k)	Includes a tax benefit of $47 million for the three months and year ended December 31, 2015, related to cost savings initiatives.

(l)	Includes a tax benefit related to costs to achieve mergers of $12 million for the three months ended December 31, 2015, and $37 million for the year ended December 31, 2015.

(m)	Includes a tax benefit related to costs to achieve mergers of $13 million for the three months ended December 31, 2014, and $78 million for the year ended December 31, 2014.

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In millions, except per-share amounts)


	Years Ended December 31,
	2015		2014			2013
Operating Revenues
Regulated electric	$	21,379	$	21,550		$	20,329
Nonregulated electric and other		1,544		1,802			1,916
Regulated natural gas		536		573			511

Total operating revenues		23,459		23,925			22,756

Operating Expenses
Fuel used in electric generation and purchased power - regulated		7,308		7,686			7,108
Fuel used in electric generation and purchased power - nonregulated		354		533			540
Cost of natural gas		195		248			224
Operation, maintenance and other		5,871		5,856			5,673
Depreciation and amortization		3,144		3,066			2,668
Property and other taxes		1,135		1,213			1,274
Impairment charges		120		81			399

Total operating expenses		18,127		18,683			17,886

Gains (Losses) on Sales of Other Assets and Other, net		35		16			(16	)

Operating Income		5,367		5,258			4,854

Other Income and Expenses
Equity in earnings of unconsolidated affiliates		69		130			122
Gains on sales of unconsolidated affiliates		7		17			100
Other income and expenses, net		307		351			262

Total other income and expenses		383		498			484

Interest Expense		1,613		1,622			1,543

Income from Continuing Operations before Income Taxes		4,137		4,134			3,795
Income Tax Expense from Continuing Operations		1,326		1,669			1,205

Income from Continuing Operations		2,811		2,465			2,590
Income (Loss) from Discontinued Operations, net of tax		20		(576	)		86

Net Income		2,831		1,889			2,676
Less: Net Income Attributable to Noncontrolling Interests		15		6			11

Net Income Attributable to Duke Energy Corporation	$	2,816	$	1,883		$	2,665


Earnings Per Share - Basic and Diluted
Income from continuing operations attributable to Duke Energy Corporation common stockholders
Basic	$	4.02	$	3.46		$	3.64
Diluted	$	4.02	$	3.46		$	3.63
Income (Loss) from discontinued operations attributable to Duke Energy Corporation common stockholders
Basic	$	0.03	$	(0.80	)	$	0.13
Diluted	$	0.03	$	(0.80	)	$	0.13
Net income attributable to Duke Energy Corporation common stockholders
Basic	$	4.05	$	2.66		$	3.77
Diluted	$	4.05	$	2.66		$	3.76
Weighted-average shares outstanding
Basic		694		707			706
Diluted		694		707			706

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(in million, except per-share amounts)	December 31, 2015			December 31, 2014
ASSETS
Current Assets
Cash and cash equivalents	$	857		$	2,036
Receivables (net of allowance for doubtful accounts of $18 at December 31, 2015 and $17 at December 31, 2014)		703			791
Restricted receivables of variable interest entities (net of allowance for doubtful accounts of $53 at December 31, 2015 and $51 at December 31, 2014)		1,748			1,973
Inventory		3,810			3,459
Assets held for sale		—			364
Regulatory assets		877			1,115
Other		327			1,837

Total current assets		8,322			11,575

Investments and Other Assets
Investments in equity method unconsolidated affiliates		499			358
Nuclear decommissioning trust funds		5,825			5,546
Goodwill		16,343			16,321
Assets held for sale		—			2,642
Other		3,042			3,008

Total investments and other assets		25,709			27,875

Property, Plant and Equipment
Cost		112,826			104,861
Accumulated depreciation and amortization		(37,665	)		(34,824	)
Generation facilities to be retired, net		548			9

Net property, plant and equipment		75,709			70,046

Regulatory Assets and Deferred Debits
Regulatory assets		11,373			11,042
Other		43			19

Total regulatory assets and deferred debits		11,416			11,061

Total Assets	$	121,156		$	120,557

LIABILITIES AND EQUITY
Current Liabilities
Accounts payable	$	2,400		$	2,271
Notes payable and commercial paper		3,633			2,514
Taxes accrued		348			569
Interest accrued		430			418
Current maturities of long-term debt		2,074			2,807
Liabilities associated with assets held for sale		—			262
Regulatory liabilities		400			204
Other		2,115			2,188

Total current liabilities		11,400			11,233

Long-term Debt		37,495			37,061

Deferred Credits and Other Liabilities
Deferred income taxes		12,705			13,423
Investment tax credits		472			427
Accrued pension and other post-retirement benefit costs		1,088			1,145
Liabilities associated with assets held for sale		—			35
Asset retirement obligations		10,264			8,466
Regulatory liabilities		6,255			6,193
Other		1,706			1,675

Total deferred credits and other liabilities		32,490			31,364

Commitments and Contingencies
Equity
Common stock, $0.001 par value, 2 billion shares authorized; 688 million and 707 million shares outstanding at December 31, 2015 and December 31, 2014, respectively		1			1
Additional paid-in capital		37,968			39,405
Retained earnings		2,564			2,012
Accumulated other comprehensive loss		(806	)		(543	)

Total Duke Energy Corporation stockholder’s equity		39,727			40,875
Noncontrolling interests		44			24

Total equity		39,771			40,899

Total Liabilities and Equity	$	121,156		$	120,557

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In millions)


	Years Ended December 31,
	2015			2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income	$	2,831		$	1,889
Adjustments to reconcile net income to net cash provided by operating activities		3,845			4,697

Net cash provided by operating activities		6,676			6,586


CASH FLOWS FROM INVESTING ACTIVITIES
Net cash used in investing activities		(5,277	)		(5,373	)


CASH FLOWS FROM FINANCING ACTIVITIES
Net cash used in financing activities		(2,578	)		(678	)


Net (decrease) increase in cash and cash equivalents		(1,179	)		535
Cash and cash equivalents at the beginning of period		2,036			1,501

Cash and cash equivalents at end of period	$	857		$	2,036

DUKE ENERGY CORPORATION

EARNINGS VARIANCES

December 2015 QTD vs. Prior Year


($ per share)	Regulated Utilities			International Energy			Commercial Portfolio			Other			Consolidated
2014 QTD Reported Earnings Per Share, Diluted	$	0.64		$	(0.43	)	$	0.03		$	(0.10	)	$	0.14

Costs to Achieve, Mergers		—			—			—			0.03			0.03
Midwest Generation Operations (offset in Discontinued Operations)		—			—			0.04			—			0.04
Litigation Reserve		0.14			—			—			—			0.14
International Tax Adjustment		—			0.53			—			—			0.53
Discontinued Operations								(0.02	)					(0.02	)

2014 QTD Adjusted Earnings Per Share, Diluted	$	0.78		$	0.10		$	0.05		$	(0.07	)	$	0.86


Stock Repurchase (a)		0.02			—			—			—			0.02

Weather		(0.12	)		—			—			—			(0.12	)

Pricing and Riders (b)		0.09			—			—			—			0.09

Volumes		0.04			—			—			—			0.04

Wholesale (c)		0.05			—			—			—			0.05

Operation and Maintenance, net of recoverables		0.01			—			—			—			0.01

Latin America, including Foreign Exchange Rates (e)		—			0.02			—			—			0.02

National Methanol Company		—			(0.03	)		—			—			(0.03	)

Duke Energy Renewables (f)		—			—			0.03			—			0.03

Midwest Generation (g)		—			—			(0.01	)		—			(0.01	)

Interest Expense		0.01			—			—			—			0.01

Change in effective tax rates		0.04			—			—			(0.07	)		(0.03	)

Other (h)		(0.05	)		0.01			(0.01	)		(0.02	)		(0.07	)

2015 QTD Adjusted Earnings Per Share, Diluted	$	0.87		$	0.10		$	0.06		$	(0.16	)		0.87

Costs to Achieve, Mergers		—			—			—			(0.03	)		(0.03	)
Cost Savings Initiatives		(0.02	)		—			—			(0.11	)		(0.13	)
Ash Basin Settlement and Penalties		(0.01	)		—			—			—			(0.01	)
Discontinued Operations														(0.01	)

2015 QTD Reported Earnings Per Share, Diluted	$	0.84		$	0.10		$	0.06		$	(0.30	)	$	0.69

Note 1: Earnings Per Share amounts are calculated using the consolidated effective income tax rate.

Note 2: Adjusted and Reported Earnings Per Share amounts by segment may not recompute from other published schedules due to rounding.

(a)

Due to the decrease in common shares outstanding as a result of stock repurchased and retired under the Accelerated Stock Repurchase Program. Weighted-average diluted shares outstanding decreased from 707 million shares for the three months ended December 31, 2014, to 688 million shares for the three months ended December 31, 2015.

(b)	Primarily due to higher energy efficiency and other rider recoveries across jurisdictions (+$0.03), equity return on the NCEMPA rider (+$0.02) and fuel and purchased power cost true-ups (+$0.02).

(c)	Primarily due to the implementation of new contracts, including the new 30-year contract with NCEMPA.

(d)	Primarily due to lower spending for fossil generation, partially offset by increased costs related to the NCEMPA asset purchase.

(e)	Primarily due to higher results in Brazil (+$0.04) due to lower purchased power costs and higher results in Ecuador (+$0.01), partially offset by changes in foreign currency exchange rates (-$0.02).

(f)	Primarily due to tax credits generated by the completion of solar and wind facilities.

(g)	Due to the sale of the nonregulated Midwest generation business.

(h)	Amount for Regulated Utilities includes increased depreciation and amortization expense (-$0.05) due to higher depreciable base.

DUKE ENERGY CORPORATION

EARNINGS VARIANCES

December 2015 YTD vs. Prior Year


($ per share)	Regulated Utilities			International Energy			Commercial Portfolio			Other			Consolidated
2014 YTD Reported Earnings Per Share, Diluted	$	3.96		$	0.08		$	(0.07	)	$	(0.49	)	$	2.66

Asset Sales		—			—			—			(0.01	)		(0.01	)
Costs to Achieve, Mergers		—			—			—			0.18			0.18
Midwest Generation Operations (offset in Discontinued Operations)		—			—			0.16			—			0.16
Asset Impairment		—			—			0.08			—			0.08
Economic Hedges (Mark-to-Market)		—			—			0.01			—			0.01
Litigation Reserve		0.14			—			—			—			0.14
International Tax Adjustment		—			0.53			—			—			0.53
Discontinued Operations								(0.02	)					0.80

2014 YTD Adjusted Earnings Per Share, Diluted	$	4.10		$	0.61		$	0.16		$	(0.32	)	$	4.55


Stock Repurchase (a)		0.08			0.01			—			—			0.09

Weather		—			—			—			—			—

Pricing and Riders (b)		0.23			—			—			—			0.23

Volumes		0.07			—			—			—			0.07

Wholesale (c)		0.16			—			—			—			0.16

Operation and Maintenance, net of recoverables (d)		(0.18	)		—			—			—			(0.18	)

Latin America, including Foreign Exchange Rates (e)		—			(0.22	)		—			—			(0.22	)

National Methanol Company		—			(0.07	)		—			—			(0.07	)

Duke Energy Renewables (f)		—			—			0.01			—			0.01

Midwest Generation (g)		—			—			0.04			—			0.04

Interest Expense		—			—			—			0.01			0.01

Change in effective tax rates		(0.04	)		—			—			0.07			0.03

Other (h)		(0.14	)		—			(0.01	)		(0.03	)		(0.18	)

2015 YTD Adjusted Earnings Per Share, Diluted	$	4.28		$	0.33		$	0.20		$	(0.27	)		4.54

Edwardsport Settlement		(0.08	)		—			—			—			(0.08	)
Costs to Achieve, Mergers		—			—			—			(0.09	)		(0.09	)
Ash Basin Settlement and Penalties		(0.02	)		—			—			—			(0.02	)
Midwest Generation Operations (offset in Discontinued Operations)		—			—			(0.14	)		—			(0.14	)
Cost Savings Initiatives		(0.01	)		—			—			(0.12	)		(0.13	)
Discontinued Operations								(0.06	)					(0.03	)

2015 YTD Reported Earnings Per Share, Diluted	$	4.17		$	0.33		$	—		$	(0.48	)	$	4.05

Note 1: Earnings Per Share amounts are calculated using the consolidated effective income tax rate.

Note 2: Adjusted and Reported Earnings Per Share amounts by segment may not recompute from other published schedules due to rounding.

(a)

Due to the decrease in common shares outstanding as a result of stock repurchased and retired under the Accelerated Stock Repurchase Program. Weighted-average diluted shares outstanding decreased from 707 million shares for the year ended December 31, 2014, to 694 million shares for the year ended December 31, 2015.

(b)	Primarily due to fuel and purchased power cost true-ups (+$0.09), higher energy efficiency and other rider recoveries in most jurisdictions (+$0.05) and the recognition of equity returns on the NCEMPA purchase (+$0.02).

(c)	Primarily due to the implementation of new contracts, including the new 30-year contract with NCEMPA.

(d)	Primarily due to an increase in nuclear outage cost levelization, additional costs related to the NCEMPA asset purchase and higher planned fossil generation outage costs, partially offset by lower storm costs.

(e)

Primarily due to a prior-year tax benefit related to the reorganization of the company’s operations in Chile (-$0.07), changes in foreign currency exchange rates (-$0.05), lower results in Brazil due to unfavorable hydrology (-$0.05) and lower results in Central America (-$0.04) due to lower generation and prices from increased competition.

(f)	Primarily due to tax credits generated by the completion of solar and wind facilities, partially offset by lower wind resources.

(g)	Primarily due to higher capacity revenues, improved generation margins and the suspension of depreciation as a result of held for sale status prior to the sale of the nonregulated Midwest generation business.

(h)	Amount for Regulated Utilities includes increased depreciation and amortization expense (-$0.13) due to higher depreciable base and an impairment of the Crystal River Unit 3 regulatory asset (-$0.02), partially offset by higher AFUDC-equity (+$0.04).

Regulated Utilities

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31										Year Ended December 31
	2015		2014		% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		17,198		18,284		(5.9	%)		1.5	%		83,393			83,348			0.1	%		0.5	%
General Service		18,243		18,274		(0.2	%)		0.9	%		77,367			76,640			0.9	%		0.5	%
Industrial		12,827		12,799		0.2	%		2.1	%		52,197			51,772			0.8	%		1.0	%
Other Energy Sales		147		154		(4.5	%)					597			609			(2.0	%)
Unbilled Sales		113		416		(72.8	%)		n/a			(363	)		(504	)		28.0	%		n/a

Total Retail Sales		48,528		49,927		(2.8	%)		1.4	%		213,191			211,865			0.6	%		0.6	%

Special Sales		9,524		8,344		14.1	%					38,075			35,522			7.2	%

Total Consolidated Electric Sales - Regulated Utilities		58,052		58,271		(0.4	%)					251,266			247,387			1.6	%

Average Number of Customers (Electric)
Residential		6,394,280		6,314,356		1.3	%					6,362,549			6,281,841			1.3	%
General Service		955,880		946,153		1.0	%					952,483			942,919			1.0	%
Industrial		17,983		18,252		(1.5	%)					18,107			18,299			(1.0	%)
Other Energy Sales		23,119		22,896		1.0	%					23,049			22,658			1.7	%

Total Regular Sales		7,391,262		7,301,657		1.2	%					7,356,188			7,265,717			1.2	%

Special Sales		63		61		3.3	%					63			62			1.6	%

Total Average Number of Customers - Regulated Utilities		7,391,325		7,301,718		1.2	%					7,356,251			7,265,779			1.2	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		13,915		17,867		(22.1	)%					76,348			87,148			(12.4	)%
Nuclear		18,541		16,570		11.9	%					71,121			67,809			4.9	%
Hydro		996		453		119.9	%					2,021			2,154			(6.2	)%
Oil and Natural Gas		14,616		11,370		28.5	%					60,670			49,430			22.7	%
Renewable Energy		3		2		50.0	%					13			13			—	%

Total Generation (4)		48,071		46,262		3.9	%					210,173			206,554			1.8	%
Purchased Power and Net Interchange (5)(7)		11,763		14,902		(21.1	)%					52,845			53,550			(1.3	)%

Total Sources of Energy		59,834		61,164		(2.2	)%					263,018			260,104			1.1	%
Less: Line Loss and Company Usage (7)		1,782		2,893		(38.4	)%					11,752			12,717			(7.6	)%

Total GWh Sources		58,052		58,271		(0.4	)%					251,266			247,387			1.6	%

Owned MW Capacity (3)
Summer												50,216			49,600
Winter												53,484			53,191
Nuclear Capacity Factor (%) (6)												94			93

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

(6)	Statistics reflect 100% of jointly owned stations.

(7)	2014 amounts have been updated to include Duke Energy Ohio’s auction purchases from PJM within Purchased Power and Net Interchange and the associated line loss in Line Loss and Company Usage.

Regulated Utilities

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31									Year Ended December 31
	2015			2014			% Inc. (Dec.)			2015			2014			% Inc. (Dec.)
Heating and Cooling Degree Days
Carolinas - Actual
Heating Degree Days		731			1,229			(40.5	%)		2,788			3,364			(17.1	%)
Cooling Degree Days		44			56			(21.4	%)		1,788			1,591			12.4	%

Variance from Normal
Heating Degree Days		(37.7	%)		4.8	%		n/a			(7.7	%)		11.2	%		n/a
Cooling Degree Days		(13.7	%)		14.6	%		n/a			7.0	%		(4.2	%)		n/a

Midwest - Actual
Heating Degree Days		1,402			2,064			(32.1	%)		4,925			5,893			(16.4	%)
Cooling Degree Days		11			10			10.0	%		1,093			928			17.8	%

Variance from Normal
Heating Degree Days		(25.9	%)		10.8	%		n/a			(1.3	%)		18.2	%		n/a
Cooling Degree Days		(50.0	%)		(52.4	%)		n/a			(9.3	%)		(21.4	%)		n/a

Florida - Actual
Heating Degree Days		27			233			(88.4	%)		400			651			(38.6	%)
Cooling Degree Days		765			409			87.0	%		3,742			3,111			20.3	%

Variance from Normal
Heating Degree Days		(86.2	%)		9.9	%		n/a			(32.6	%)		3.7	%		n/a
Cooling Degree Days		65.2	%		(9.7	%)		n/a			17.0	%		(2.5	%)		n/a

Duke Energy Carolinas

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		5,471			6,039			(9.4	%)					27,916			27,976			(0.2	%)
General Service		6,626			6,736			(1.6	%)					28,700			28,421			1.0	%
Industrial		5,406			5,347			1.1	%					22,136			21,577			2.6	%
Other Energy Sales		76			77			(1.3	%)					305			303			0.7	%
Unbilled Sales		579			168			244.6	%					(114	)		(324	)		64.8	%

Total Regular Electric Sales		18,158			18,367			(1.1	%)		4.6	%		78,943			77,953			1.3	%		1.4	%

Special Sales		1,706			1,928			(11.5	%)					8,432			9,692			(13.0	%)

Total Consolidated Electric Sales - Duke Energy Carolinas		19,864			20,295			(2.1	%)					87,375			87,645			(0.3	%)

Average Number of Customers
Residential		2,128,724			2,100,086			1.4	%					2,117,482			2,089,299			1.3	%
General Service		346,378			342,725			1.1	%					345,119			341,616			1.0	%
Industrial		6,337			6,505			(2.6	%)					6,417			6,519			(1.6	%)
Other Energy Sales		15,123			14,921			1.4	%					15,041			14,693			2.4	%

Total Regular Sales		2,496,562			2,464,237			1.3	%					2,484,059			2,452,127			1.3	%

Special Sales		24			26			(7.7	%)					25			26			(3.8	%)

Total Average Number of Customers - Duke Energy Carolinas		2,496,586			2,464,263			1.3	%					2,484,084			2,452,153			1.3	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		3,769			5,912			(36.2	%)					25,896			31,596			(18.0	%)
Nuclear		10,903			9,671			12.7	%					45,013			42,381			6.2	%
Hydro		700			246			184.6	%					1,136			1,185			(4.1	%)
Oil and Natural Gas		2,659			1,849			43.8	%					10,595			7,878			34.5	%
Renewable Energy		3			2			50.0	%					13			13			—	%

Total Generation (4)		18,034			17,680			2.0	%					82,653			83,053			(0.5	%)
Purchased Power and Net Interchange (5)		2,182			3,718			(41.3	%)					9,170			9,602			(4.5	%)

Total Sources of Energy		20,216			21,398			(5.5	%)					91,823			92,655			(0.9	%)
Less: Line Loss and Company Usage		352			1,103			(68.1	%)					4,448			5,010			(11.2	%)

Total GWh Sources		19,864			20,295			(2.1	%)					87,375			87,645			(0.3	%)

Owned MW Capacity (3)
Summer														19,645			19,589
Winter														20,360			20,550
Nuclear Capacity Factor (%) (6)														96			92

Heating and Cooling Degree Days
Actual
Heating Degree Days		813			1,282			(36.6	%)					2,922			3,517			(16.9	%)
Cooling Degree Days		22			44			(50.0	%)					1,731			1,485			16.6	%

Variance from Normal
Heating Degree Days		(34.2	%)		3.9	%		n/a						(7.6	%)		11.3	%		n/a
Cooling Degree Days		(46.3	%)		15.8	%		n/a						8.4	%		(6.1	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

(6)	Statistics reflect 100% of jointly owned stations.

Duke Energy Progress

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		3,407			3,926			(13.2	%)					17,954			18,201			(1.4	%)
General Service		3,529			3,618			(2.5	%)					15,529			15,385			0.9	%
Industrial		2,498			2,505			(0.3	%)					10,288			10,321			(0.3	%)
Other Energy Sales		25			29			(13.8	%)					106			117			(9.4	%)
Unbilled Sales		50			359			(86.1	%)					(302	)		41			(836.6	%)

Total Regular Electric Sales		9,509			10,437			(8.9	%)		0.7	%		43,575			44,065			(1.1	%)		0.1	%

Special Sales		5,372			5,040			6.6	%					21,306			18,806			13.3	%

Total Consolidated Electric Sales -Duke Energy Progress		14,881			15,477			(3.9	%)					64,881			62,871			3.2	%

Average Number of Customers
Residential		1,280,852			1,264,131			1.3	%					1,274,550			1,257,007			1.4	%
General Service		227,233			224,209			1.3	%					226,099			223,287			1.3	%
Industrial		4,174			4,253			(1.9	%)					4,209			4,272			(1.5	%)
Other Energy Sales		1,648			1,696			(2.8	%)					1,677			1,721			(2.6	%)

Total Regular Sales		1,513,907			1,494,289			1.3	%					1,506,535			1,486,287			1.4	%

Special Sales		15			15			—	%					15			15			—	%

Total Average Number of Customers - Duke Energy Progress		1,513,922			1,494,304			1.3	%					1,506,550			1,486,302			1.4	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		1,506			3,808			(60.5	%)					12,960			15,882			(18.4	%)
Nuclear		7,638			6,899			10.7	%					26,108			25,428			2.7	%
Hydro		193			109			77.1	%					582			669			(13.0	%)
Oil and Natural Gas		5,020			4,226			18.8	%					22,203			17,591			26.2	%

Total Generation (4)		14,357			15,042			(4.6	%)					61,853			59,570			3.8	%
Purchased Power and Net Interchange (5)		1,022			1,115			(8.3	%)					5,649			5,956			(5.2	%)

Total Sources of Energy		15,379			16,157			(4.8	%)					67,502			65,526			3.0	%
Less: Line Loss and Company Usage		498			680			(26.8	%)					2,621			2,655			(1.3	%)

Total GWh Sources		14,881			15,477			(3.9	%)					64,881			62,871			3.2	%

Owned MW Capacity (3)
Summer														12,915			12,221
Winter														14,019			13,334
Nuclear Capacity Factor (%) (6)														91			95

Heating and Cooling Degree Days
Actual
Heating Degree Days		650			1,176			(44.7	%)					2,654			3,210			(17.3	%)
Cooling Degree Days		65			67			(3.0	%)					1,844			1,696			8.7	%

Variance from Normal
Heating Degree Days		(41.5	%)		5.7	%		n/a						(7.8	%)		11.2	%		n/a
Cooling Degree Days		4.8	%		11.9	%		n/a						5.8	%		(2.3	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

(6)	Statistics reflect 100% of jointly owned stations.

Duke Energy Florida

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		4,732			4,349			8.8	%					19,932			19,003			4.9	%
General Service		3,903			3,675			6.2	%					15,304			14,945			2.4	%
Industrial		851			823			3.4	%					3,293			3,267			0.8	%
Other Energy Sales		6			7			(14.3	%)					24			25			(4.0	%)
Unbilled Sales		(463	)		(427	)		(8.4	%)					104			34			205.9	%

Total Regular Electric Sales		9,029			8,427			7.1	%		3.3	%		38,657			37,274			3.7	%		1.6	%

Special Sales		236			225			4.9	%					1,396			1,429			(2.3	%)

Total Electric Sales - Duke Energy Florida		9,265			8,652			7.1	%					40,053			38,703			3.5	%

Average Number of Customers
Residential		1,533,247			1,510,309			1.5	%					1,524,320			1,500,729			1.6	%
General Service		194,265			191,876			1.2	%					193,437			191,142			1.2	%
Industrial		2,227			2,261			(1.5	%)					2,244			2,275			(1.4	%)
Other Energy Sales		1,534			1,547			(0.8	%)					1,537			1,551			(0.9	%)

Total Regular Sales		1,731,273			1,705,993			1.5	%					1,721,538			1,695,697			1.5	%

Special Sales		14			12			16.7	%					14			14			—	%

Total Average Number of Customers - Duke Energy Florida		1,731,287			1,706,005			1.5	%					1,721,552			1,695,711			1.5	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		1,612			2,517			(36.0	%)					9,718			11,729			(17.1	%)
Oil and Natural Gas		6,135			5,017			22.3	%					25,263			23,030			9.7	%

Total Generation (4)		7,747			7,534			2.8	%					34,981			34,759			0.6	%
Purchased Power and Net Interchange (5)		1,937			1,544			25.5	%					7,217			6,133			17.7	%

Total Sources of Energy		9,684			9,078			6.7	%					42,198			40,892			3.2	%
Less: Line Loss and Company Usage		419			426			(1.6	%)					2,145			2,189			(2.0	%)

Total GWh Sources		9,265			8,652			7.1	%					40,053			38,703			3.5	%

Owned MW Capacity (3)
Summer														9,101			9,072
Winter														10,070			10,109

Heating and Cooling Degree Days
Actual
Heating Degree Days		27			233			(88.4	%)					400			651			(38.6	%)
Cooling Degree Days		765			409			87.0	%					3,742			3,111			20.3	%

Variance from Normal
Heating Degree Days		(86.2	%)		9.9	%		n/a						(32.6	%)		3.7	%		n/a
Cooling Degree Days		65.2	%		(9.7	%)		n/a						17.0	%		(2.5	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

Duke Energy Ohio

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		1,747			1,907			(8.4	%)					8,638			8,831			(2.2	%)
General Service		2,231			2,253			(1.0	%)					9,512			9,526			(0.1	%)
Industrial		1,481			1,462			1.3	%					5,988			5,963			0.4	%
Other Energy Sales		27			27			—	%					109			111			(1.8	%)
Unbilled Sales		(44	)		160			(127.5	%)					(52	)		(82	)		36.6	%

Total Regular Electric Sales		5,442			5,809			(6.3	%)		(1.3	%)		24,195			24,349			(0.6	%)		(0.3	%)

Special Sales		299			158			89.2	%					1,244			386			222.3	%

Total Electric Sales - Duke Energy Ohio		5,741			5,967			(3.8	%)					25,439			24,735			2.8	%

Average Number of Customers
Residential		748,478			743,251			0.7	%					746,757			741,800			0.7	%
General Service		87,298			86,881			0.5	%					87,227			86,522			0.8	%
Industrial		2,530			2,534			(0.2	%)					2,530			2,525			0.2	%
Other Energy Sales		3,231			3,191			1.3	%					3,220			3,179			1.3	%

Total Regular Sales		841,537			835,857			0.7	%					839,734			834,026			0.7	%

Special Sales		1			1			—	%					1			1			—	%

Total Average Number of Customers - Duke Energy Ohio		841,538			835,858			0.7	%					839,735			834,027			0.7	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		949			1,080			(12.1	%)					4,402			3,041			44.8	%
Oil and Natural Gas		10			—			100.0	%					53			16			231.3	%

Total Generation (4)		959			1,080			(11.2	%)					4,455			3,057			45.7	%
Purchased Power and Net Interchange (5)(6)		4,934			5,269			(6.4	%)					22,280			23,355			(4.6	%)

Total Sources of Energy		5,893			6,349			(7.2	%)					26,735			26,412			1.2	%
Less: Line Loss and Company Usage (6)		152			382			(60.2	%)					1,296			1,677			(22.7	%)

Total GWh Sources		5,741			5,967			(3.8	%)					25,439			24,735			2.8	%

Owned MW Capacity (3)
Summer														1,062			1,225
Winter														1,164			1,327

Heating and Cooling Degree Days
Actual
Heating Degree Days		1,316			1,927			(31.7	%)					4,647			5,455			(14.8	%)
Cooling Degree Days		15			13			15.4	%					1,109			1,024			8.3	%

Variance from Normal
Heating Degree Days		(28.0	%)		6.6	%		n/a						(3.6	%)		13.1	%		n/a
Cooling Degree Days		(31.8	%)		(35.0	%)		n/a						(7.9	%)		(13.1	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

(6)	2014 amounts have been updated to include Duke Energy Ohio’s auction purchases from PJM within Purchased Power and Net Interchange and the associated line loss in Line Loss and Company Usage.

Duke Energy Ohio

Quarterly Highlights

Supplemental Regulated Utilities Gas Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
MCF Sales (1)
Residential		6,285,290			9,686,129			(35.1	%)					35,272,072			41,040,532			(14.1	%)
General Service		4,356,384			6,205,202			(29.8	%)					22,820,237			25,541,023			(10.7	%)
Industrial		1,557,468			1,953,376			(20.3	%)					7,161,750			7,379,010			(2.9	%)
Other Energy Sales		4,843,752			5,430,602			(10.8	%)					20,037,755			21,047,330			(4.8	%)
Unbilled Sales		2,453,000			3,295,000			(25.6	%)					(768,000	)		(1,732,000	)		55.7	%

Total Gas Sales - Duke Energy Ohio		19,495,894			26,570,309			(26.6	%)		(6.9	%)		84,523,814			93,275,895			(9.4	%)		(2.4	%)

Average Number of Customers
Residential		475,254			473,956			0.3	%					474,842			472,940			0.4	%
General Service		43,378			43,648			(0.6	%)					43,253			43,446			(0.4	%)
Industrial		1,627			1,631			(0.2	%)					1,619			1,629			(0.6	%)
Other Energy Sales		142			145			(2.1	%)					142			152			(6.6	%)

Total Average Number of Gas Customers - Duke Energy Ohio		520,401			519,380			0.2	%					519,856			518,167			0.3	%

Heating and Cooling Degree Days
Actual
Heating Degree Days		1,316			1,927			(31.7	%)					4,647			5,455			(14.8	%)
Cooling Degree Days		15			13			15.4	%					1,109			1,024			8.3	%

Variance from Normal
Heating Degree Days		(28.0	%)		6.6	%		n/a						(3.6	%)		13.1	%		n/a
Cooling Degree Days		(31.8	%)		(35.0	%)		n/a						(7.9	%)		(13.1	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

Duke Energy Indiana

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

December 2015


	Three Months Ended December 31												Year Ended December 31
	2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)			2015			2014			% Inc. (Dec.)			% Inc. (Dec.) Weather Normal (2)
GWH Sales (1)
Residential		1,841			2,063			(10.8	%)					8,953			9,337			(4.1	%)
General Service		1,954			1,992			(1.9	%)					8,322			8,363			(0.5	%)
Industrial		2,591			2,662			(2.7	%)					10,492			10,644			(1.4	%)
Other Energy Sales		13			14			(7.1	%)					53			53			—	%
Unbilled Sales		(9	)		156			(105.8	%)					1			(173	)		100.6	%

Total Regular Electric Sales		6,390			6,887			(7.2	%)		(4.2	%)		27,821			28,224			(1.4	%)		(1.1	%)

Special Sales		1,911			993			92.4	%					5,697			5,209			9.4	%

Total Electric Sales - Duke Energy Indiana		8,301			7,880			5.3	%					33,518			33,433			0.3	%

Average Number of Customers
Residential		702,979			696,579			0.9	%					699,440			693,006			0.9	%
General Service		100,706			100,462			0.2	%					100,601			100,352			0.2	%
Industrial		2,715			2,699			0.6	%					2,707			2,708			—	%
Other Energy Sales		1,583			1,541			2.7	%					1,574			1,514			4.0	%

Total Regular Sales		807,983			801,281			0.8	%					804,322			797,580			0.8	%

Special Sales		9			7			28.6	%					8			6			33.3	%

Total Average Number of Customers - Duke Energy Indiana		807,992			801,288			0.8	%					804,330			797,586			0.8	%

Sources of Electric Energy (GWh)
Generated - Net Output (3)
Coal		6,079			4,550			33.6	%					23,372			24,900			(6.1	%)
Hydro		103			98			5.1	%					303			300			1.0	%
Oil and Natural Gas		792			278			184.9	%					2,556			915			179.3	%

Total Generation (4)		6,974			4,926			41.6	%					26,231			26,115			0.4	%
Purchased Power and Net Interchange (5)		1,688			3,256			(48.2	%)					8,529			8,504			0.3	%

Total Sources of Energy		8,662			8,182			5.9	%					34,760			34,619			0.4	%
Less: Line Loss and Company Usage		361			302			19.5	%					1,242			1,186			4.7	%

Total GWh Sources		8,301			7,880			5.3	%					33,518			33,433			0.3	%

Owned MW Capacity (3)
Summer														7,493			7,493
Winter														7,871			7,871

Heating and Cooling Degree Days
Actual
Heating Degree Days		1,487			2,200			(32.4	%)					5,202			6,330			(17.8	%)
Cooling Degree Days		6			7			(14.3	%)					1,076			832			29.3	%

Variance from Normal
Heating Degree Days		(24.0	%)		14.7	%		n/a						0.8	%		23.1	%		n/a
Cooling Degree Days		(73.9	%)		(66.7	%)		n/a						(10.7	%)		(29.7	%)		n/a

(1)	Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes.

(2)	Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).

(3)	Statistics reflect Duke Energy’s ownership share of jointly owned stations.

(4)	Generation by source is reported net of auxiliary power.

(5)	Purchased power includes renewable energy purchases.

DUKE ENERGY CORPORTATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Three Months Ended December 31, 2015

(Dollars in millions, except per-share amounts)


				Special Items
	Adjusted Earnings			Costs to Achieve, Mergers			Edwardsport Settlement			Cost Savings Initiatives			Ash Basin Settlement and Penalties			Economic Hedges (Mark-to- Market)			Discontinued Operations			Total Adjustments			Reported Earnings
*SEGMENT INCOME*
Regulated Utilities	$	601		$	—		$	(2	)B	$	(10	)C	$	(7	)F	$	—		$	—		$	(19	)	$	582
International Energy		68			—			—			—			—			—			—			—			68
Commercial Portfolio		41			—			—			(1	)D		—			(1	)G		—			(2	)		39

Total Reportable Segment Income		710			—			(2	)		(11	)		(7	)		(1	)		—			(21	)		689
Other		(108	)		(18	)A		—			(77	)E		—			—			—			(95	)		(203	)

Total Reportable Segment Income and Other Net Expense		602			(18	)		(2	)		(88	)		(7	)		(1	)		—			(116	)		486
Discontinued Operations		—			—			—			—			—			—			(9	)H		(9	)		(9	)

Net Income Attributable to Duke Energy Corporation	$	602		$	(18	)	$	(2	)	$	(88	)	$	(7	)	$	(1	)	$	(9	)	$	(125	)	$	477

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC*	$	0.87		$	(0.03	)	$	—		$	(0.13	)	$	(0.01	)	$	—		$	(0.01	)	$	(0.18	)	$	0.69

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED*	$	0.87		$	(0.03	)	$	—		$	(0.13	)	$	(0.01	)	$	—		$	(0.01	)	$	(0.18	)	$	0.69

A -	Net of $12 million tax benefit. Recorded within Operating Expenses on the Consolidated Statements of Operations.

B -	Net of $1 million tax benefit. $3 million recorded within Impairment charges on the Duke Energy Indiana Consolidated Statements of Operations.

C -

Net of $6 million tax benefit. Primarily consists of severance costs recorded within Operation, maintenance and other on the Consolidated Statements of Operations. Includes $7 million at Duke Energy Carolinas, $4 million at Duke Energy Progress, $2 million at Duke Energy Florida, $1 million at Duke Energy Ohio and $2 million at Duke Energy Indiana.

D -	Net of $1 million tax benefit. Primarily consists of severance costs recorded within Operation, maintenance and other on the Consolidated Statements of Operations.

E -	Net of $47 million tax benefit. Primarily consists of severance costs recorded within Operation, maintenance and other on the Consolidated Statements of Operations.

F -	Recorded within Operation, maintenance and other on the Duke Energy Carolinas Consolidated Statements of Operations.

G -	Recorded within Operating Revenues on the Consolidated Statements of Operations.

H -	Recorded in Income (Loss) From Discontinued Operations, net of tax on the Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions


Basic			688
Diluted			688

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Twelve Months Ended December 31, 2015

(Dollars in millions, except per-share amounts)


				Special Items
	Adjusted Earnings			Costs to Achieve, Mergers			Edwardsport Settlement			Midwest Generation Operations			Ash Basin Settlement and Penalties			Cost Savings Initiatives			Discontinued Operations			Total Adjustments			Reported Earnings
*SEGMENT INCOME*
Regulated Utilities	$	2,972		$	—		$	(58	)B	$	—		$	(11	)D	$	(10	)E	$	—		$	(79	)	$	2,893
International Energy		225			—			—			—			—			—			—			—			225
Commercial Portfolio		140			—			—			(94	)C		—			(1	)F		(41	)H		(136	)		4

Total Reportable Segment Income		3,337			—			(58	)		(94	)		(11	)		(11	)		(41	)		(215	)		3,122
Other		(185	)		(60	)A		—			—			—			(77	)G		—			(137	)		(322	)
Intercompany Eliminations		—			—			—			—			—			—			(4	)I		(4	)		(4	)

Total Reportable Segment Income and Other Net Expense		3,152			(60	)		(58	)		(94	)		(11	)		(88	)		(45	)		(356	)		2,796
Discontinued Operations		—			—			—			94	C		—			—			(74	)J		20			20

Net Income Attributable to Duke Energy Corporation	$	3,152		$	(60	)	$	(58	)	$	—		$	(11	)	$	(88	)	$	(119	)	$	(336	)	$	2,816

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC*	$	4.54		$	(0.09	)	$	(0.08	)	$	—		$	(0.02	)	$	(0.13	)	$	(0.17	)	$	(0.49	)	$	4.05

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED*	$	4.54		$	(0.09	)	$	(0.08	)	$	—		$	(0.02	)	$	(0.13	)	$	(0.17	)	$	(0.49	)	$	4.05

A -	Net of $37 million tax benefit. Recorded within Operating Expenses and Interest Expenses on the Consolidated Statements of Operations.

B -	Net of $35 million tax benefit. $88 million recorded within Impairment charges and $5 million recorded within Other income and expenses, net on the Duke Energy Indiana Consolidated Statements of Operations.

C -	Operating results of the nonregulated Midwest generation business that had been classified from discontinued operations after adjustment for special items and economic hedges (net of $53 million tax benefit).

D -	Net of $3 million tax benefit. Recorded within Operation, maintenance and other on the Consolidated Statements of Operations. Includes $8 million and $6 million at Duke Energy Carolinas and Duke Energy Progress, respectively.

E -

F -	Net of $1 million tax benefit. Primarily consists of severance costs recorded within Operation, maintenance and other on the Consolidated Statements of Operations.

G -	Net of $47 million tax benefit. Primarily consists of severance costs recorded within Operation, maintenance and other on the Consolidated Statements of Operations.

H -	State tax expense resulting from the completion of the sale of the nonregulated Midwest generation business.

I -	Reverses the impact on eliminations of classifying the nonregulated Midwest generation business as discontinued operations.

J -	Recorded in Income (Loss) From Discontinued Operations, net of tax on the Consolidated Statements of Operations, and includes the impact of a litigation reserve related to the nonregulated Midwest generation business.

Weighted Average Shares (reported and adjusted) - in millions


Basic			694
Diluted			694

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Three Months Ended December 31, 2014

(Dollars in millions, except per-share amounts)


				Special Items
	Adjusted Earnings			Costs to Achieve, Progress Merger			Midwest Generation Operations			Litigation Reserve			International Tax Adjustment			Discontinued Operations			Total Adjustments			Reported Earnings
*SEGMENT INCOME*
Regulated Utilities	$	551		$	—		$	—		$	(102	)G	$	—		$	—		$	(102	)	$	449
International Energy		72			—			—			—			(373	)D		—			(373	)		(301	)
Commercial Portfolio		32			—			(32	)B		—			—			15	F		(17	)		15

Total Reportable Segment Income		655			—			(32	)		(102	)		(373	)		15			(492	)		163
Other		(45	)		(20	)A		—			—			—			—			(20	)		(65	)
Intercompany Eliminations		—			—			—			—			—			(3	)E		(3	)		(3	)

Total Reportable Segment Income and Other Net Expense		610			(20	)		(32	)		(102	)		(373	)		12			(515	)		95
Discontinued Operations		—			—			32	B		—			—			(30	)C		2			2

Net Income Attributable to Duke Energy Corporation	$	610		$	(20	)	$	—		$	(102	)	$	(373	)	$	(18	)	$	(513	)	$	97

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC*	$	0.86		$	(0.03	)	$	—		$	(0.14	)	$	(0.53	)	$	(0.02	)	$	(0.72	)	$	0.14

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED*	$	0.86		$	(0.03	)	$	—		$	(0.14	)	$	(0.53	)	$	(0.02	)	$	(0.72	)	$	0.14

A -	Net of $13 million tax benefit. $33 million recorded in Operating Expenses on the Consolidated Statements of Operations.

B -

Midwest Generation Operations reclassifies the operating results of the nonregulated Midwest generation business that had been classified as discontinued operations after adjustment for special items and economic hedges from discontinued operations to the Commercial Power segment (net of $20 million tax benefit).

C -

Recorded in Income (loss) From Discontinued Operations, net of tax on the Consolidated Statements of Operations. Includes the adjustment to the impairment of the nonregulated Midwest generation business, the mark-to-market of economic hedges of the nonregulated Midwest generation business, and certain costs associated with a contract settlement.

D -	Deferred tax impact resulting from the decision to repatriate International Energy’s historic undistributed foreign earnings, included within Income Tax Expense on the Consolidated Statement of Operations.

E -	Reverses the impact on eliminations of classifying the nonregulated Midwest generation business as discontinued operations.

F -	State tax benefit resulting from the planned disposition of the nonregulated Midwest generation business.

G -	Recorded within Operating, maintenance and other (Operating Expenses) on the Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions


Basic			707
Diluted			707

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Twelve Months Ended December 31, 2014

(Dollars in millions, except per-share amounts)


				Special Items
	Adjusted Earnings			Costs to Achieve, Progress Merger			Asset Impairment			Midwest Generation Operations			Litigation Reserve			Asset Sales			International Tax Adjustment			Economic Hedges (Mark-to- Market) *			Discontinued Operations			Total Adjustments			Reported Earnings
*SEGMENT INCOME*
Regulated Utilities	$	2,897		$	—		$	—		$	—		$	(102	)J	$	—		$	—		$	—		$	—		$	(102	)	$	2,795
International Energy		428			—			—			—			—			—			(373	)H		—			—			(373	)		55
Commercial Portfolio		109			—			(59	)F		(114	)C		—			—			—			(6	)B		15	I		(164	)		(55	)

Total Reportable Segment Income		3,434			—			(59	)		(114	)		(102	)		—			(373	)		(6	)		15			(639	)		2,795
Other		(216	)		(127	)A		—			—			—			9	E		—			—			—			(118	)		(334	)
Intercompany Eliminations		—			—			—			—			—			—			—			—			(10	)G		(10	)		(10	)

Total Reportable Segment Income and Other Net Expense		3,218			(127	)		(59	)		(114	)		(102	)		9			(373	)		(6	)		5			(767	)		2,451
Discontinued Operations		—			—			—			114	C		—			—			—			—			(682	)D		(568	)		(568	)

Net Income Attributable to Duke Energy Corporation	$	3,218		$	(127	)	$	(59	)	$	—		$	(102	)	$	9		$	(373	)	$	(6	)	$	(677	)	$	(1,335	)	$	1,883

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC*	$	4.55		$	(0.18	)	$	(0.08	)	$	—		$	(0.14	)	$	0.01		$	(0.53	)	$	(0.01	)	$	(0.96	)	$	(1.89	)	$	2.66

*EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED*	$	4.55		$	(0.18	)	$	(0.08	)	$	—		$	(0.14	)	$	0.01		$	(0.53	)	$	(0.01	)	$	(0.96	)	$	(1.89	)	$	2.66

A -	Net of $78 million tax benefit. $5 million recorded as a decrease in Operating Revenues, $198 million recorded within Operating Expenses and $2 million recorded within Interest Expense on the Consolidated Statements of Operations.

B -	Net of $3 million tax benefit. Recorded within Operating Revenues on the Consolidated Statements of Operations.

C -

D -

Recorded in Income (Loss) From Discontinued Operations, net of tax on the Consolidated Statements of Operations. Includes the impairment of the nonregulated Midwest generation business, the mark-to-market of economic hedges of the nonregulated Midwest generation business and certain costs associated with a contract settlement.

E -	Net of $5 million tax expense. Recorded in Other Income and Expenses on the Consolidated Statements of Operations.

F -	Net of $35 million tax benefit. Recorded in impairment charges on the Consolidated Statements of Operations.

G -	Reverses the impact on eliminations of classifying the nonregulated Midwest generation business as discontinued operations.

H -	Deferred tax impact resulting from the decision to repatriate International Energy’s historic undistributed foreign earnings, included within Income Tax Expense on the Consolidated Statement of Operations.

I -	State tax benefit resulting from the planned disposition of the nonregulated Midwest generation business.

J -	Recorded within Operating, maintenance and other (Operating Expenses) on the Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions


Basic			707
Diluted			707

Mark-to-market adjustments reflect the impact of derivative contracts, which are used in Duke Energy’s hedging of a portion of the economic value of its generation assets in the Commercial Portfolio segment and also relate to existing derivative positions that may have tenors beyond the planned disposal date of the nonregulated Midwest generation business. The mark-to-market impact of derivative contracts is recognized in GAAP earnings immediately as such derivative contracts do not qualify for hedge accounting or regulatory treatment. The economic value of generation assets is subject to fluctuations in fair value due to market price volatility of input and output commodities (e.g. coal, electricity, natural gas). Economic hedging involves both purchases and sales of those input and output commodities related to generation assets. Operations of the generation assets are accounted for under the accrual method. Management believes excluding impacts of mark-to-market changes of the derivative contracts from adjusted earnings until settlement better matches the financial impacts of the derivative contract with the portion of economic value of the underlying hedged asset. However, due to the divestiture of the nonregulated Midwest generation business as mentioned above, certain derivative positions have tenors beyond the planned disposal date of these assets. As such, management has excluded settlements of these derivative positions from adjusted diluted EPS as these realized gains and losses more closely relate to the loss on disposal of these assets. Management believes that the presentation of adjusted diluted EPS Attributable to Duke Energy Corporation provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy Corporation’s performance across periods.

DUKE ENERGY CORPORATION

ADJUSTED EFFECTIVE TAX RECONCILIATION

Three Months and Year Ended December 31, 2015

(Dollars in Millions)


	Three Months Ended December 31, 2015						Year Ended December 31, 2015
	Balance			Effective Tax Rate			Balance			Effective Tax Rate
Adjusted Earnings, Pre-Tax Income*	$	882					$	4,634
Midwest Generation Operations		—						(147	)
Cost Savings Initiatives		(142	)					(142	)
Costs to Achieve, Mergers		(30	)					(97	)
Edwardsport Settlement		(3	)					(93	)
Ash Basin Settlement and Penalties		(7	)					(14	)
Economic Hedges (Mark-to-Market)		(1	)					—
Intercompany Eliminations		—						(4	)

Reported Income From Continuing Operations Before Income Taxes	$	699					$	4,137

Adjusted Tax Expense*	$	275			31	%**	$	1,467			32	%**
Tax Adjustment Related to Midwest Generation Sale		—						41
Midwest Generation Operations		—						(53	)
Cost Savings Initiatives		(54	)					(54	)
Costs to Achieve, Mergers		(12	)					(37	)
Edwardsport Settlement		(1	)					(35	)
Ash Basin Settlement and Penalties		—						(3	)

Reported Income Tax Expense From Continuing Operations	$	208			30	%	$	1,326			32	%

*	Includes amounts attributable to noncontrolling interests

Adjusted effective tax rate is a non-GAAP financial measure as the rate is calculated using pretax earnings and income tax expense, both adjusted for the impact of special items. The most directly comparable GAAP measure for adjusted effective tax rate is reported effective tax rate, which includes the impact of special items.

DUKE ENERGY CORPORATION

ADJUSTED EFFECTIVE TAX RECONCILIATION

Three Months and Year Ended December 31, 2014

(Dollars in Millions)


	Three Months Ended December 31, 2014						Year Ended December 31, 2014
	Balance			Effective Tax Rate			Balance			Effective Tax Rate
Adjusted Earnings, Pre-Tax Income*	$	873					$	4,715
Costs to Achieve, Mergers		(33	)					(205	)
Midwest Generation Operations		(52	)					(185	)
Litigation Reserve		(102	)					(102	)
Asset Impairment		—						(94	)
Economic Hedges (Mark-to-Market)		—						(9	)
Asset Sales		—						14

Reported Income From Continuing Operations Before Income Taxes	$	686					$	4,134

Adjusted Tax Expense*	$	263			30	%**	$	1,493			32	%**
International Tax Adjustment		373						373
Costs to Achieve, Mergers		(13	)					(78	)
Midwest Generation Operations		(20	)					(71	)
Asset Impairment		—						(35	)
Economic Hedges (Mark-to-Market)		—						(3	)
Tax Adjustment Related to Midwest Generation Sale		(15	)					(15	)
Asset Sales		—						5

Reported Income Tax Expense From Continuing Operations	$	588			86	%	$	1,669			40	%

*	Includes amounts attributable to noncontrolling interests

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Form 8-K Duke Energy CORP For: Feb 18

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