RELATED PARTY TRANSACTIONS

The Subsidiary Registrants engage in related party transactions, which are generally performed at cost and in accordance with the applicable state and federal commission regulations. Refer to the Condensed Consolidated Balance Sheets of the Subsidiary Registrants for balances due to or due from related parties. Material amounts related to transactions with related parties included in the Condensed Consolidated Statements of Operations and Comprehensive Income are presented in the following table.



	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)	2015		2014		2015		2014
Duke Energy Carolinas
Corporate governance and shared service expenses^(a)	$	202	$	217	$	421	$	439
Indemnification coverages^(b)	6		5		12		11
Joint Dispatch Agreement (JDA) revenue^(c)	14		15		40		112
Joint Dispatch Agreement (JDA) expense^(c)	38		40		95		91
Progress Energy
Corporate governance and shared services provided by Duke Energy^(a)	$	172	$	200	$	339	$	378
Indemnification coverages^(b)	9		8		19		17
JDA revenue^(c)	38		40		95		91
JDA expense^(c)	14		15		40		112
Duke Energy Progress
Corporate governance and shared service expenses^(a)	$	93	$	104	$	194	$	200
Indemnification coverages^(b)	4		4		8		9
JDA revenue^(c)	38		40		95		91
JDA expense^(c)	14		15		40		112
Duke Energy Florida
Corporate governance and shared service expenses^(a)	$	79	$	97	$	145	$	178
Indemnification coverages^(b)	5		4		11		8
Duke Energy Ohio
Corporate governance and shared service expenses^(a)	$	103	$	82	$	188	$	159
Indemnification coverages^(b)	1		3		4		6
Duke Energy Indiana
Corporate governance and shared service expenses^(a)	$	83	$	94	$	172	$	199
Indemnification coverages^(b)	2		3		4		5


(a)	The Subsidiary Registrants are charged their proportionate share of corporate governance and other shared services costs, primarily related to human resources, employee benefits, legal and accounting fees, as well as other third-party costs. These amounts are recorded in Operation, maintenance and other on the Condensed Consolidated Statements of Operations and Comprehensive Income.


(b)	The Subsidiary Registrants incur expenses related to certain indemnification coverages through Bison, Duke Energy’s wholly owned captive insurance subsidiary. These expenses are recorded in Operation, maintenance and other on the Condensed Consolidated Statements of Operations and Comprehensive Income.

(c)

Duke Energy Carolinas and Duke Energy Progress participate in a JDA which allows the collective dispatch of power plants between the service territories to reduce customer rates. Revenues from the sale of power under the JDA are recorded in Operating Revenues on the Condensed Consolidated Statements of Operations and Comprehensive Income. Expenses from the purchase of power under the JDA are recorded in Fuel used in electric generation and purchased power on the Condensed Consolidated Statements of Operations and Comprehensive Income.

In addition to the amounts presented above, the Subsidiary Registrants record the impact of other affiliate transactions in net income, including rental of office space, participation in a money pool arrangement, other operational transactions and their proportionate share of certain charged expenses. See Note 6 to the Consolidated Financial Statements in the Annual Report on Form 10-K for more information regarding money pool. The net impact of these transactions was not material for the three and six months ended June 30, 2015 and 2014 for the Subsidiary Registrants.

See Note 13 for information related to the sale of receivables to an affiliate consolidated by Duke Energy.

Duke Energy Ohio's nonregulated indirect subsidiary, Duke Energy Commercial Asset Management (DECAM), owned generating plants included in the Disposal Group sold to Dynegy on April 2, 2015. On April 1, 2015, Duke Energy Ohio distributed its indirect ownership interest in DECAM to a Duke Energy subsidiary and non-cash settled DECAM's intercompany loan payable of $294 million. The intercompany loan payable recorded in Notes payable to affiliated companies on Duke Energy Ohio’s Condensed Consolidated Balance Sheets was $459 million as of December 31, 2014.

Intercompany transactions between DECAM and related parties are included in Income (Loss) From Discontinued Operations, net of tax in Duke Energy Ohio’s Condensed Consolidated Statements of Operations and Comprehensive Income. These amounts were a net expense of $3 million and $81 million for the six months ended June 30, 2015 and 2014, respectively, and a net expense of $27 million for the three months ended June 30, 2014.

Refer to Note 2 for further information on the sale of the Disposal Group.