Severance

9 Months Ended

Sep. 30, 2013

15. SEVERANCE

In conjunction with the merger with Progress Energy, in November 2011, Duke Energy and Progress Energy offered a voluntary severance plan to certain eligible employees. As this was a voluntary severance plan, all severance benefits offered under this plan are considered special termination benefits under U.S. GAAP. Special termination benefits are measured upon employee acceptance and recorded immediately absent any significant retention period. If a significant retention period exists, the cost of the special termination benefits are recorded ratably over the retention period. Approximately 1,100 employees from Duke Energy and Progress Energy requested severance during the voluntary window, which closed on November 30, 2011. The estimated amount of future severance expense associated with this voluntary plan and other severance benefits through 2014 are not material.

Additionally, in the third quarter of 2012, a voluntary severance plan was offered to certain unionized employees of Duke Energy Ohio. Approximately 75 employees accepted the termination benefits during the voluntary window, which closed on October 8, 2012. The expense associated with this plan was not material.

In conjunction with the retirement of Crystal River Unit 3, severance benefits will be made available to certain eligible impacted unionized and non-unionized employees, to the extent that those employees do not find job opportunities at other locations. Approximately 600 employees worked at Crystal River Unit 3. For the nine months ended September 30, 2013, Duke Energy Florida deferred $26 million of severance costs as a regulatory asset. Severance costs expected to be accrued over the remaining retention period for employees identified to have a significant retention period is not material. However, these employees maintain the ability to accept job opportunities at other Duke Energy locations, which would result in severance not being paid. If a significant amount of these individuals redeploy within Duke Energy, the final severance benefits paid under the plan may be less than what has been accrued to date. Refer to Note 4 for further discussion regarding Crystal River Unit 3.

Amounts included in the table below represent direct and allocated severance and related expense recorded by the Duke Energy Registrants, and are recorded in Operation, maintenance, and other within Operating Expenses on the Condensed Consolidated Statements of Operations.


	Three Months Ended September 30,					Nine Months Ended September 30,
(in millions)			2013		2012			2013		2012
Duke Energy		$	5	$	146		$	30	$	146
Duke Energy Carolinas			—		48			7		48
Progress Energy			4		66			17		66
Duke Energy Progress			3		42			12		42
Duke Energy Florida			1		24			5		24
Duke Energy Ohio			—		15			2		15
Duke Energy Indiana			—		13			2		13

Amounts included in the table below represent the severance liability for past and ongoing severance plans. Amounts for Subsidiary Registrants do not include allocated expense or associated cash payments. Amounts for Duke Energy Ohio and Duke Energy Indiana are not material.

(in millions)		Duke Energy		Duke Energy Carolinas		Progress Energy		Duke Energy Progress		Duke Energy Florida
Balance at December 31, 2012		$	135	$	12	$	43	$	23	$	6
Provision / Adjustments^(a)			41		2		45		7		30
Cash Reductions			(114)		(12)		(42)		(17)		(13)
Balance at September 30, 2013		$	62	$	2	$	46	$	13	$	23

(a)	Provision / Adjustments for Duke Energy, Progress Energy and Duke Energy Florida includes $26 million of severance costs deferred related to Crystal River Unit 3.

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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