RELATED PARTY TRANSACTIONS

The Subsidiary Registrants engage in related party transactions in accordance with the applicable state and federal commission regulations. Refer to the 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 Consolidated Statements of Operations and Comprehensive Income are presented in the following table.



	Years Ended December 31,
(in millions)	2015		2014		2013
Duke Energy Carolinas
Corporate governance and shared service expenses^(a)	$	914	$	851	$	927
Indemnification coverages^(b)	24		21		22
JDA revenue^(c)	51		133		121
JDA expense^(c)	183		198		116
Progress Energy
Corporate governance and shared services provided by Duke Energy^(a)	$	712	$	732	$	290
Corporate governance and shared services provided to Duke Energy^(d)	—		—		96
Indemnification coverages^(b)	38		33		34
JDA revenue^(c)	183		198		116
JDA expense^(c)	51		133		121
Duke Energy Progress
Corporate governance and shared service expenses^(a)	$	403	$	386	$	266
Indemnification coverages^(b)	16		17		20
JDA revenue^(c)	183		198		116
JDA expense^(c)	51		133		121
Duke Energy Florida
Corporate governance and shared service expenses^(a)	$	309	$	346	$	182
Indemnification coverages^(b)	22		16		14
Duke Energy Ohio
Corporate governance and shared service expenses^(a)	$	342	$	316	$	347
Indemnification coverages^(b)	6		13		15
Duke Energy Indiana
Corporate governance and shared service expenses^(a)	$	349	$	384	$	422
Indemnification coverages^(b)	9		11		14


(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 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 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 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 Consolidated Statements of Operations and Comprehensive Income.

(d)

In 2013, Progress Energy Service Company (PESC), a consolidated subsidiary of Progress Energy, charged a proportionate share of corporate governance and other costs to consolidated affiliates of Duke Energy. Corporate governance and other shared costs were primarily related to human resources, employee benefits, legal and accounting fees, as well as other third-party costs. These charges were recorded as an offset to Operation, maintenance and other in the Consolidated Statements of Operations and Comprehensive Income. Effective January 1, 2014, PESC was contributed to Duke Energy Corporate Services (DECS), a consolidated subsidiary of Duke Energy, and these costs were no longer charged out of Progress Energy. Progress Energy recorded a non-cash after-tax equity transfer related to the contribution of PESC to DECS in its Consolidated Statements of Changes in Common Stockholder's Equity.

In addition to the amounts presented above, the Subsidiary Registrants record the impact on net income of other affiliate transactions, 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 for more information regarding money pool. The net impact of these transactions was not material for the years ended December 31, 2015, 2014 and 2013 for the Subsidiary Registrants.

As discussed in Note 17, certain trade receivables have been sold by Duke Energy Ohio and Duke Energy Indiana to CRC, an affiliate formed by a subsidiary of Duke Energy. The proceeds obtained from the sales of receivables are largely cash but do include a subordinated note from CRC for a portion of the purchase price.

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 Consolidated Balance Sheets was $459 million as of December 31, 2014.

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

Intercompany Income Taxes

Duke Energy and its subsidiaries file a consolidated federal income tax return and other state and jurisdictional returns. The Subsidiary Registrants have a tax sharing agreement with Duke Energy for the allocation of consolidated tax liabilities and benefits. Income taxes recorded represent amounts the Subsidiary Registrants would incur as separate C-Corporations. The following table includes the balance of intercompany income tax receivables for the subsidiary registrants.



	Duke				Duke		Duke		Duke		Duke
	Energy		Progress		Energy		Energy		Energy		Energy
(in millions)	Carolinas		Energy		Progress		Florida		Ohio		Indiana
December 31, 2015
Intercompany income tax receivable	$	122	$	120	$	104	$	—	$	54	$	—
Intercompany income tax payable	—		—		—		96		—		47

December 31, 2014
Intercompany income tax receivable	$	43	$	713	$	267	$	174	$	39	$	95