XML 51 R9.htm IDEA: XBRL DOCUMENT v3.8.0.1
Business Segments
 3 Months Ended
Mar. 31, 2018
Segment Reporting [Abstract]  
Business Segments
BUSINESS SEGMENTS
Operating segments are determined based on information used by the chief operating decision-maker in deciding how to allocate resources and evaluate the performance of the business. Duke Energy evaluates segment performance based on segment income. Segment income is defined as income from continuing operations net of income attributable to noncontrolling interests. Segment income includes intercompany revenues and expenses that are eliminated on the Condensed Consolidated Financial Statements. Certain governance costs are allocated to each segment. In addition, direct interest expense and income taxes are included in segment income.
Duke Energy
Duke Energy's segment structure includes the following segments: Electric Utilities and Infrastructure, Gas Utilities and Infrastructure and Commercial Renewables.
The Electric Utilities and Infrastructure segment includes Duke Energy's regulated electric utilities in the Carolinas, Florida and the Midwest. The regulated electric utilities conduct operations through the Subsidiary Registrants that are substantially all regulated and, accordingly, qualify for regulatory accounting treatment. Electric Utilities and Infrastructure also includes Duke Energy's electric transmission infrastructure investments.
The Gas Utilities and Infrastructure segment includes Piedmont, Duke Energy's natural gas local distribution companies in Ohio and Kentucky, and Duke Energy's natural gas storage and midstream pipeline investments. Gas Utilities and Infrastructure's operations are substantially all regulated and, accordingly, qualify for regulatory accounting treatment.
Commercial Renewables is primarily comprised of nonregulated utility scale wind and solar generation assets located throughout the U.S.
The remainder of Duke Energy’s operations is presented as Other, which is primarily comprised of interest expense on holding company debt, unallocated corporate costs and Duke Energy’s wholly owned captive insurance company, Bison Insurance Company Limited (Bison). Other also includes Duke Energy's 17.5 percent interest in National Methanol Company (NMC), a large regional producer of methyl tertiary butyl ether located in Saudi Arabia. The investment in NMC is accounted for under the equity method of accounting.
Business segment information is presented in the following tables. Segment assets presented exclude intercompany assets.
 
Three Months Ended March 31, 2018
 
Electric

 
Gas

 
 
 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Commercial

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Renewables

 
Segments

 
Other

 
Eliminations

 
Consolidated

Unaffiliated revenues
$
5,315

 
$
702

 
$
101

 
$
6,118

 
$
17

 
$
—

 
$
6,135

Intersegment revenues
8

 
25

 
—

 
33

 
18

 
(51
)
 
—

Total revenues
$
5,323

 
$
727

 
$
101

 
$
6,151

 
$
35

 
$
(51
)
 
$
6,135

Segment income (loss)(a)(b)(c)
$
750

 
$
116

 
$
20

 
$
886

 
$
(266
)
 
$
—

 
$
620

Add back noncontrolling interests
 
 
 
 
 
 
 
 
 
 
 
 
2

Net income
 
 
 
 
 
 
 
 
 
 
 
 
$
622

Segment assets
$
120,021

 
$
11,396

 
$
4,265

 
$
135,682

 
$
2,682

 
$
177

 
$
138,541


 
Three Months Ended March 31, 2017
 
Electric

 
Gas

 
 
 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Commercial

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Renewables

 
Segments

 
Other

 
Eliminations

 
Consolidated

Unaffiliated revenues
$
4,939

 
$
648

 
$
128

 
$
5,715

 
$
14

 
$
—

 
$
5,729

Intersegment revenues
8

 
22

 
—

 
30

 
19

 
(49
)
 
—

Total revenues
$
4,947

 
$
670

 
$
128

 
$
5,745

 
$
33

 
$
(49
)
 
$
5,729

Segment income (loss)
$
635

 
$
133

 
$
25

 
$
793

 
$
(77
)
 
$
—

 
$
716

Add back noncontrolling interests
 
 
 
 
 
 
 
 
 
 
 
 
1

Net income
 
 
 
 
 
 
 
 
 
 
 
 
$
717


(a)
Electric Utilities and Infrastructure includes regulatory charges related to NCUC orders and settlements. See Note 3 for additional information.
(b)
Gas Utilities and Infrastructure includes an impairment of the investment in Constitution Pipeline Company, LLC (Constitution). See Note 3 for additional information.
(c)
Other includes the loss on the sale of the retired Beckjord generating station (Beckjord) described below and a valuation allowance recorded against the alternative minimum tax credits subject to sequestration. See Note 16 for additional information on the valuation allowance.

Beckjord, a nonregulated facility retired during 2014, was sold on February 26, 2018, at a pretax loss of $106 million recorded within (Loss) Gains on Sales of Other Assets and Other, net and $1 million recorded within Operation, maintenance and other on Duke Energy's Condensed Consolidated Statements of Operations. The sale included the transfer of coal ash basins and other real property and indemnification from any and all potential future claims related to the property, whether arising under environmental laws or otherwise.
Duke Energy Ohio
Duke Energy Ohio has two reportable operating segments, Electric Utilities and Infrastructure and Gas Utilities and Infrastructure.
Electric Utilities and Infrastructure transmits and distributes electricity in portions of Ohio and generates, distributes and sells electricity in portions of Northern Kentucky. Gas Utilities and Infrastructure transports and sells natural gas in portions of Ohio and Northern Kentucky. It conducts operations primarily through Duke Energy Ohio and its wholly owned subsidiary, Duke Energy Kentucky.
The remainder of Duke Energy Ohio's operations is presented as Other, which is primarily comprised of governance costs allocated by its parent, Duke Energy, and revenues and expenses related to Duke Energy Ohio's contractual arrangement to buy power from the Ohio Valley Electric Corporation's (OVEC) power plants. See Note 7 for additional information on related party transactions.
 
Three Months Ended March 31, 2018
 
Electric

 
Gas

 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Segments

 
Other

 
Eliminations

 
Consolidated

Total revenues
$
336

 
$
174

 
$
510

 
$
14

 
$
—

 
$
524

Segment income (loss)/Net income (loss)(a)
33

 
34

 
67

 
(92
)
 
—

 
(25
)
Segment assets
$
5,165

 
$
2,709

 
$
7,874

 
$
25

 
$
(3
)
 
$
7,896

 
Three Months Ended March 31, 2017
 
Electric

 
Gas

 
Total

 
 
 
 
 
Utilities and

 
Utilities and

 
Reportable

 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Segments

 
Other

 
Consolidated

Total revenues
$
337

 
$
170

 
$
507

 
$
11

 
$
518

Segment income (loss)/Net income (loss)
24

 
26

 
50

 
(8
)
 
42


(a)
Other includes the loss on the sale of the retired Beckjord generating station described above.