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.

Duke Energy

Due to the Piedmont acquisition and the sale of International Energy in the fourth quarter of 2016, Duke Energy's segment structure has been realigned to include the following segments: Electric Utilities and Infrastructure, Gas Utilities and Infrastructure and Commercial Renewables. Prior period information has been recast to conform to the current segment structure. See Note 2 for further information on the Piedmont and International Energy transactions.

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 unallocated corporate interest expense, unallocated corporate costs, contributions to the Duke Energy Foundation and the operations of Duke Energy’s wholly owned captive insurance subsidiary, Bison Insurance Company Limited (Bison). Other also includes Duke Energy's 25 percent interest in NMC, a large regional producer of methyl tertiary butyl ether (MTBE) 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 June 30, 2017
	Electric		Gas				Total
	Utilities and		Utilities and		Commercial		Reportable
(in millions)	Infrastructure		Infrastructure		Renewables		Segments		Other			Eliminations			Consolidated
Unaffiliated revenues	$	5,150	$	279	$	110	$	5,539	$	16		$	—		$	5,555
Intersegment revenues	8		22		—		30		19			(49		)	—
Total revenues	$	5,158	$	301	$	110	$	5,569	$	35		$	(49	)	$	5,555
Segment income (loss)^(a)	$	729	$	27	$	26	$	782	$	(94	)	$	—		$	688
Add back noncontrolling interests															3
Loss from discontinued operations, net of tax															(2		)
Net income															$	689
Segment assets	$	117,009	$	11,073	$	4,306	$	132,388	$	2,435		$	181		$	135,004



	Three Months Ended June 30, 2016
	Electric		Gas				Total
	Utilities and		Utilities and		Commercial		Reportable
(in millions)	Infrastructure		Infrastructure		Renewables		Segments		Other			Eliminations			Consolidated
Unaffiliated revenues	$	4,993	$	97	$	112	$	5,202	$	11		$	—		$	5,213
Intersegment revenues	8		2		—		10		19			(29		)	—
Total revenues	$	5,001	$	99	$	112	$	5,212	$	30		$	(29	)	$	5,213
Segment income (loss)^(a)	$	704	$	16	$	11	$	731	$	(107	)	$	—		$	624
Loss from discontinued operations, net of tax															(112		)
Net income															$	512



	Six Months Ended June 30, 2017
	Electric		Gas				Total
	Utilities and		Utilities and		Commercial		Reportable
(in millions)	Infrastructure		Infrastructure		Renewables		Segments		Other			Eliminations			Consolidated
Unaffiliated revenues	$	10,090	$	927	$	238	$	11,255	$	29		$	—		$	11,284
Intersegment revenues	15		44		—		59		39			(98		)	—
Total revenues	$	10,105	$	971	$	238	$	11,314	$	68		$	(98	)	$	11,284
Segment income (loss)^(a)	$	1,364	$	160	$	51	$	1,575	$	(171	)	$	—		$	1,404
Add back noncontrolling interests															4
Loss from discontinued operations, net of tax															(2		)
Net income															$	1,406



	Six Months Ended June 30, 2016
	Electric		Gas				Total
	Utilities and		Utilities and		Commercial		Reportable
(in millions)	Infrastructure		Infrastructure		Renewables		Segments		Other			Eliminations			Consolidated
Unaffiliated revenues	$	10,074	$	266	$	226	$	10,566	$	24		$	—		$	10,590
Intersegment revenues	16		3		—		19		35			(54		)	—
Total revenues	$	10,090	$	269	$	226	$	10,585	$	59		$	(54	)	$	10,590
Segment income (loss)^(a)	$	1,368	$	48	$	37	$	1,453	$	(255	)	$	—		$	1,198
Add back noncontrolling interests															3
Income from discontinued operations, net of tax															10
Net income															$	1,211


(a)	Other includes costs to achieve the Piedmont acquisition. See Notes 2 and 9 for additional information.

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 8 for additional information on related party transactions.



	Three Months Ended June 30, 2017
	Electric		Gas		Total
	Utilities and		Utilities and		Reportable
(in millions)	Infrastructure		Infrastructure		Segments		Other			Consolidated
Total revenues	$	329	$	100	$	429	$	8		$	437
Segment income (loss)/Net Income	22		17		39		(9		)	30
Segment assets	4,879		2,672		7,551		54			7,605



	Three Months Ended June 30, 2016
	Electric		Gas		Total
	Utilities and		Utilities and		Reportable
(in millions)	Infrastructure		Infrastructure		Segments		Other			Consolidated
Total revenues	$	323	$	98	$	421	$	7		$	428
Segment income (loss)/Net Income	19		14		33		(10		)	23



	Six Months Ended June 30, 2017
	Electric		Gas		Total
	Utilities and		Utilities and		Reportable
(in millions)	Infrastructure		Infrastructure		Segments		Other			Consolidated
Total revenues	$	665	$	270	$	935	$	20		$	955
Segment income (loss)/Net Income	46		42		88		(16		)	72



	Six Months Ended June 30, 2016
	Electric		Gas		Total
	Utilities and		Utilities and		Reportable
(in millions)	Infrastructure		Infrastructure		Segments		Other			Consolidated
Total revenues	$	663	$	269	$	932	$	12		$	944
Segment income (loss)	$	55	$	45	$	100	$	(20	)	$	80
Income from discontinued operations, net of tax										2
Net income										82

DUKE ENERGY CAROLINAS, PROGRESS ENERGY, DUKE ENERGY PROGRESS, DUKE ENERGY FLORIDA, DUKE ENERGY INDIANA AND PIEDMONT

Piedmont has one reportable segment, Gas Utilities and Infrastructure, which transports and sells natural gas. The remainder of Piedmont's operations is presented as Other, which is comprised of certain unallocated corporate costs, including acquisition-related expenses, and earnings from Piedmont's equity method investment in SouthStar prior to its sale. Piedmont sold its 15 percent membership interest in SouthStar on October 3, 2016. Piedmont's income, net of tax, from SouthStar for the three and six months ended June 30, 2016, was $3 million and $10 million, respectively.

The remaining Subsidiary Registrants each have one reportable operating segment, Electric Utilities and Infrastructure, which generates, transmits, distributes and sells electricity. The remainder of each company's operations is presented as Other, which is comprised of certain unallocated corporate costs. Other for Progress Energy also includes interest expense on corporate debt instruments of $56 million and $111 million for the three and six months ended June 30, 2017, respectively, and $55 million and $111 million for the three and six months ended June 30, 2016, respectively. The following table summarizes the net (loss) income of Other for each of these entities.



	Three Months Ended						Six Months Ended
	June 30,						June 30,
(in millions)	2017			2016			2017			2016
Duke Energy Carolinas	$	(6	)	$	(17	)	$	(12	)	$	(34	)
Progress Energy	(45		)	(45		)	(88		)	(94		)
Duke Energy Progress	(4		)	(8		)	(7		)	(16		)
Duke Energy Florida	(3		)	(5		)	(5		)	(9		)
Duke Energy Indiana	(1		)	(5		)	(3		)	(7		)
Piedmont	(9		)	1			(13		)	7

The assets at Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana are substantially all included within the Electric Utilities and Infrastructure segment at June 30, 2017. The assets at Piedmont are substantially all included within the Gas Utilities and Infrastructure segment at June 30, 2017.