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Investments in Debt and Equity Securities
12 Months Ended
Dec. 31, 2017
Investments, Debt and Equity Securities [Abstract]  
Investments in Debt and Equity Securities
INVESTMENTS IN DEBT AND EQUITY SECURITIES
The Duke Energy Registrants classify their investments in debt and equity securities as either trading or available-for-sale.
TRADING SECURITIES
Piedmont's investments in debt and equity securities held in rabbi trusts associated with certain deferred compensation plans are classified as trading securities. The fair value of these investments was $1 million and $5 million as of December 31, 2017, and 2016, respectively.
AVAILABLE-FOR-SALE (AFS) SECURITIES
All other investments in debt and equity securities are classified as AFS.
Duke Energy’s AFS securities are primarily comprised of investments held in (i) the nuclear decommissioning trust funds (NDTF) at Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida, (ii) grantor trusts at Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana related to OPEB plans and (iii) Bison.
Duke Energy classifies all other investments in debt and equity securities as long term, unless otherwise noted.
Investment Trusts
The investments within the NDTF investments and the Duke Energy Progress, Duke Energy Florida and Duke Energy Indiana grantor trusts (Investment Trusts) are managed by independent investment managers with discretion to buy, sell and invest pursuant to the objectives set forth by the trust agreements. The Duke Energy Registrants have limited oversight of the day-to-day management of these investments. As a result, the ability to hold investments in unrealized loss positions is outside the control of the Duke Energy Registrants. Accordingly, all unrealized losses associated with debt and equity securities within the Investment Trusts are considered OTTIs and are recognized immediately.
Investments within the Investment Trusts generally qualify for regulatory accounting and accordingly realized and unrealized gains and losses are generally deferred as a regulatory asset or liability.
Substantially all amounts of the Duke Energy Registrants' gross unrealized holding losses as of December 31, 2017, and 2016, are considered OTTIs on investments within Investment Trusts that have been recognized immediately as a regulatory asset.
Other AFS Securities
Unrealized gains and losses on all other AFS securities are included in other comprehensive income until realized, unless it is determined the carrying value of an investment is other-than-temporarily impaired. If an OTTI exists, the unrealized loss is included in earnings based on the criteria discussed below.
The Duke Energy Registrants analyze all investment holdings each reporting period to determine whether a decline in fair value should be considered other-than-temporary. Criteria used to evaluate whether an impairment associated with equity securities is other-than-temporary includes, but is not limited to, (i) the length of time over which the market value has been lower than the cost basis of the investment, (ii) the percentage decline compared to the cost of the investment and (iii) management’s intent and ability to retain its investment for a period of time sufficient to allow for any anticipated recovery in market value. If a decline in fair value is determined to be other-than-temporary, the investment is written down to its fair value through a charge to earnings.
If the entity does not have an intent to sell a debt security and it is not more likely than not management will be required to sell the debt security before the recovery of its cost basis, the impairment write-down to fair value would be recorded as a component of other comprehensive income, except for when it is determined a credit loss exists. In determining whether a credit loss exists, management considers, among other things, (i) the length of time and the extent to which the fair value has been less than the amortized cost basis, (ii) changes in the financial condition of the issuer of the security, or in the case of an asset backed security, the financial condition of the underlying loan obligors, (iii) consideration of underlying collateral and guarantees of amounts by government entities, (iv) ability of the issuer of the security to make scheduled interest or principal payments and (v) any changes to the rating of the security by rating agencies. If a credit loss exists, the amount of impairment write-down to fair value is split between credit loss and other factors. The amount related to credit loss is recognized in earnings. The amount related to other factors is recognized in other comprehensive income. There were no material credit losses as of December 31, 2017, and 2016.
Other Investments amounts are recorded in Other within Other Noncurrent Assets on the Consolidated Balance Sheets.
DUKE ENERGY
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

NDTF
 
 
 
 
 
 
 
 
 

 
 
Cash and cash equivalents
$

 
$

 
$
115

 
$

 
$

 
$
111

Equity securities
2,805

 
27

 
4,914

 
2,092

 
54

 
4,106

Corporate debt securities
17

 
2

 
570

 
10

 
8

 
528

Municipal bonds
4

 
3

 
344

 
3

 
10

 
331

U.S. government bonds
11

 
7

 
1,027

 
10

 
8

 
984

Other debt securities

 
1

 
118

 

 
3

 
124

Total NDTF
$
2,837

 
$
40

 
$
7,088

 
$
2,115

 
$
83

 
$
6,184

Other Investments
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
$

 
$

 
$
15

 
$

 
$

 
$
25

Equity securities
59

 

 
123

 
38

 

 
104

Corporate debt securities
1

 

 
57

 
1

 
1

 
66

Municipal bonds
2

 
1

 
83

 
2

 
1

 
82

U.S. government bonds

 

 
41

 

 
1

 
51

Other debt securities

 
1

 
44

 

 
2

 
42

Total Other Investments
$
62

 
$
2

 
$
363

 
$
41

 
$
5

 
$
370

Total Investments
$
2,899

 
$
42

 
$
7,451

 
$
2,156

 
$
88

 
$
6,554


The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
117

Due after one through five years
552

Due after five through 10 years
554

Due after 10 years
1,061

Total
$
2,284


Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were as follows.
 
Years Ended December 31,
(in millions)
2017

 
2016

 
2015

Realized gains
$
202

 
$
246

 
$
193

Realized losses
160

 
187

 
98


DUKE ENERGY CAROLINAS
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

NDTF
 
 
 
 
 
 
 
 
 
 
 

Cash and cash equivalents
$

 
$

 
$
32

 
$

 
$

 
$
18

Equity securities
1,531

 
12

 
2,692

 
1,157

 
28

 
2,245

Corporate debt securities
9

 
2

 
359

 
5

 
6

 
354

Municipal bonds

 
1

 
60

 
1

 
2

 
67

U.S. government bonds
3

 
4

 
503

 
2

 
5

 
458

Other debt securities

 
1

 
112

 

 
3

 
116

Total NDTF  
$
1,543

 
$
20

 
$
3,758

 
$
1,165

 
$
44

 
$
3,258

Other Investments
 

 
 

 
 

 
 

 
 

 
 

Other debt securities
$

 
$

 
$

 
$

 
$
1

 
$
3

Total Other Investments
$

 
$

 
$

 
$

 
$
1

 
$
3

Total Investments
$
1,543

 
$
20

 
$
3,758

 
$
1,165

 
$
45

 
$
3,261


The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
9

Due after one through five years
204

Due after five through 10 years
300

Due after 10 years
521

Total
$
1,034


Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were as follows.
 
Years Ended December 31,
(in millions)
2017

 
2016

 
2015

Realized gains
$
135

 
$
157

 
$
158

Realized losses
103

 
121

 
83


PROGRESS ENERGY
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

NDTF
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$

 
$

 
$
83

 
$

 
$

 
$
93

Equity securities
1,274

 
15

 
2,222

 
935

 
26

 
1,861

Corporate debt securities
8

 

 
211

 
5

 
2

 
174

Municipal bonds
4

 
2

 
284

 
2

 
8

 
264

U.S. government bonds
8

 
3

 
524

 
8

 
3

 
526

Other debt securities

 

 
6

 

 

 
8

Total NDTF
$
1,294

 
$
20

 
$
3,330

 
$
950

 
$
39

 
$
2,926

Other Investments
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
$

 
$

 
$
12

 
$

 
$

 
$
21

Municipal bonds
2

 

 
47

 
2

 

 
44

Total Other Investments
$
2

 
$

 
$
59

 
$
2

 
$

 
$
65

Total Investments
$
1,296

 
$
20

 
$
3,389

 
$
952

 
$
39

 
$
2,991


The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
94

Due after one through five years
301

Due after five through 10 years
203

Due after 10 years
474

Total
$
1,072


Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were as follows.
 
Years Ended December 31,
(in millions)
2017

 
2016

 
2015

Realized gains
$
65

 
$
84

 
$
33

Realized losses
56

 
64

 
13


DUKE ENERGY PROGRESS
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

NDTF
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
$

 
$

 
$
50

 
$

 
$

 
$
45

Equity securities
980

 
12

 
1,795

 
704

 
21

 
1,505

Corporate debt securities
6

 


 
149

 
4

 
1

 
120

Municipal bonds
4

 
2

 
283

 
2

 
8

 
263

U.S. government bonds
5

 
2

 
310

 
5

 
2

 
275

Other debt securities

 

 
4

 

 

 
5

Total NDTF
$
995

 
$
16

 
$
2,591

 
$
715

 
$
32

 
$
2,213

Other Investments
 

 
 

 
 

 
 

 
  

 
 

Cash and cash equivalents
$

 
$

 
$
1

 
$

 
$

 
$
1

Total Other Investments
$

 
$

 
$
1

 
$

 
$

 
$
1

Total Investments
$
995

 
$
16

 
$
2,592

 
$
715

 
$
32

 
$
2,214


The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
21

Due after one through five years
219

Due after five through 10 years
146

Due after 10 years
360

Total
$
746


Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were as follows.
 
Years Ended December 31,
(in millions)
2017

 
2016

 
2015

Realized gains
$
54

 
$
71

 
$
26

Realized losses
48

 
55

 
11


DUKE ENERGY FLORIDA
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

NDTF
 
 
 
 
 
 
  
 
 
 
 
Cash and cash equivalents
$

 
$

 
$
33

 
$

 
$

 
$
48

Equity securities
294

 
3

 
427

 
231

 
5

 
356

Corporate debt securities
2

 

 
62

 
1

 
1

 
54

Municipal bonds

 

 
1

 

 

 
1

U.S. government bonds
3

 
1

 
214

 
3

 
1

 
251

Other debt securities

 

 
2

 

 

 
3

Total NDTF(a)
$
299

 
$
4

 
$
739

 
$
235

 
$
7

 
$
713

Other Investments
 

 
 

 
 

 
 

 
 

 
 

Cash and cash equivalents
$

 
$

 
$
1

 
$

 
$

 
$
4

Municipal bonds
2

 

 
47

 
2

 

 
44

Total Other Investments
$
2

 
$

 
$
48

 
$
2

 
$

 
$
48

Total Investments
$
301

 
$
4

 
$
787

 
$
237

 
$
7

 
$
761


(a)
During the year ended December 31, 2017, Duke Energy Florida continued to receive reimbursements from the NDTF for costs related to ongoing decommissioning activity of the Crystal River Unit 3 nuclear plant.
The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
73

Due after one through five years
82

Due after five through 10 years
57

Due after 10 years
114

Total
$
326


Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were as follows.
 
Years Ended December 31,
(in millions)
2017

 
2016

 
2015

Realized gains
$
11

 
$
13

 
$
7

Realized losses
8

 
9

 
2

DUKE ENERGY INDIANA
The following table presents the estimated fair value of investments in AFS securities.
 
December 31, 2017
 
December 31, 2016
 
Gross

 
Gross

 
 
 
Gross

 
Gross

 
 
 
Unrealized

 
Unrealized

 
 
 
Unrealized

 
Unrealized

 
 
 
Holding

 
Holding

 
Estimated

 
Holding

 
Holding

 
Estimated

(in millions)
Gains

 
Losses

 
Fair Value

 
Gains

 
Losses(a)

 
Fair Value

Other Investments
 
 
 
 
 
 
 
 
 
 
 
Equity securities
$
49

 
$

 
$
97

 
$
33

 
$

 
$
79

Corporate debt securities

 

 
3

 

 

 
2

Municipal bonds

 
1

 
28

 

 
1

 
28

U.S. government bonds

 

 

 

 

 
1

Total Other Investments
$
49

 
$
1

 
$
128

 
$
33

 
$
1

 
$
110

Total Investments
$
49

 
$
1

 
$
128

 
$
33

 
$
1

 
$
110


The table below summarizes the maturity date for debt securities.
(in millions)
December 31, 2017

Due in one year or less
$
5

Due after one through five years
12

Due after five through 10 years
7

Due after 10 years
7

Total
$
31

Realized gains and losses, which were determined on a specific identification basis, from sales of AFS securities were insignificant for the years ended December 31, 2017, 2016 and 2015.