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Business Segments
 12 Months Ended
Dec. 31, 2019
Segment Reporting [Abstract]  
Business Segments BUSINESS SEGMENTS
Reportable 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, as discussed below, includes intercompany revenues and expenses that are eliminated on the Consolidated Financial Statements. Certain governance costs are allocated to each segment. In addition, direct interest expense and income taxes are included in segment income.
Products and services are sold between affiliate companies and reportable segments of Duke Energy at cost. Segment assets as presented in the tables that follow exclude all intercompany assets.
Duke Energy
Duke Energy's segment structure includes the following segments: Electric Utilities and Infrastructure, Gas Utilities and Infrastructure and Commercial Renewables.
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.
The Commercial Renewables segment is primarily comprised of nonregulated utility-scale wind and solar generation assets located throughout the U.S. On April 24, 2019, Duke Energy executed an agreement to sell a minority interest in a portion of certain renewable assets. See Note 2 for additional information on the minority interest sale.
The remainder of Duke Energy’s operations is presented as Other, which is primarily comprised of interest expense on holding company debt, unallocated corporate costs and Duke Energy’s wholly owned captive insurance company, Bison. Other also includes Duke Energy's interest in NMC. See Note 13 for additional information on the investment in NMC.
Business segment information is presented in the following tables. Segment assets presented exclude intercompany assets.
 
Year Ended December 31, 2019
 
Electric

 
Gas

 
 
 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Commercial

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Renewables

 
Segments

 
Other

 
Eliminations

 
Total

Unaffiliated Revenues
$
22,798

 
$
1,770

 
$
487

 
$
25,055

 
$
24

 
$
—

 
$
25,079

Intersegment Revenues
33

 
96

 
—

 
129

 
71

 
(200
)
 
—

Total Revenues
$
22,831

 
$
1,866

 
$
487

 
$
25,184

 
$
95

 
$
(200
)
 
$
25,079

Interest Expense
$
1,345

 
$
117

 
$
95

 
$
1,557

 
$
705

 
$
(58
)
 
$
2,204

Depreciation and amortization
3,951

 
256

 
168

 
4,375

 
178

 
(5
)
 
4,548

Equity in earnings (losses) of unconsolidated affiliates
9

 
114

 
(4
)
 
119

 
43

 
—

 
162

Income tax expense (benefit)
785

 
22

 
(115
)
 
692

 
(173
)
 
—

 
519

Segment income (loss)(a)(b)
3,536

 
432

 
198

 
4,166

 
(452
)
 
—

 
3,714

Add back noncontrolling interest(c)
  

 
  

 
  

 
  

 
  

 
  

 
(177
)
Add back preferred stock dividend
 
 
 
 
 
 
 
 
 
 
 
 
41

Loss from discontinued operations, net of tax
  

 
  

 
  

 
  

 
  

 
  

 
(7
)
Net income
  

 
  

 
  

 
  

 
  

 
  

 
$
3,571

Capital investments expenditures and acquisitions
$
8,263

 
$
1,539

 
$
1,423

 
$
11,225

 
$
221

 
$
—

 
$
11,446

Segment assets
135,561

 
13,921

 
6,020

 
155,502

 
3,148

 
188

 
158,838

(a)
Electric Utilities and Infrastructure includes a $27 million reduction of a prior year impairment at Citrus County CC related to the plant's cost cap. See Note 4 for additional information.
(b)
Gas Utilities and Infrastructure includes an after-tax impairment charge of $19 million for the remaining investment in Constitution. See Note 13 for additional information.
(c)
Includes the allocation of losses to noncontrolling tax equity members. See Note 1 for additional information.
 
Year Ended December 31, 2018
 
Electric

 
Gas

 
 
 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Commercial

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Renewables

 
Segments

 
Other

 
Eliminations

 
Total

Unaffiliated Revenues
$
22,242


$
1,783


$
477

 
$
24,502

 
$
19

 
$
—

 
$
24,521

Intersegment Revenues
31


98


—

 
129

 
70

 
(199
)
 
—

Total Revenues
$
22,273

 
$
1,881

 
$
477

 
$
24,631

 
$
89

 
$
(199
)
 
$
24,521

Interest Expense
$
1,288


$
106


$
88

 
$
1,482

 
$
657

 
$
(45
)
 
$
2,094

Depreciation and amortization
3,523


245


155

 
3,923

 
152

 
(1
)
 
4,074

Equity in earnings (losses) of unconsolidated affiliates
5


27


(1
)
 
31

 
52

 
—

 
83

Income tax expense (benefit)(a)
799

 
78

 
(147
)
 
730

 
(282
)
 
—

 
448

Segment income (loss)(b)(c)(d)(e)
3,058

 
274

 
9

 
3,341

 
(694
)
 
—

 
2,647

Add back noncontrolling interest component
  

 
  

 
  

 
  

 
  

 
  

 
(22
)
Loss from discontinued operations, net of tax
  

 
  

 
  

 
  

 
  

 
  

 
19

Net income
  

 
  

 
  

 
  

 
  

 
  

 
$
2,644

Capital investments expenditures and acquisitions
$
8,086

 
$
1,133

 
$
193

 
$
9,412

 
$
256

 
$
—

 
$
9,668

Segment assets
125,364

 
12,361

 
4,204

 
141,929

 
3,275

 
188

 
145,392


(a)
All segments include adjustments to the December 31, 2017, estimate of the income tax effects of the Tax Act. Electric Utilities and Infrastructure includes a $24 million expense, Gas Utilities and Infrastructure includes a $1 million expense, Commercial Renewables includes a $3 million benefit and Other includes a $2 million benefit. See Note 24 for additional information.
(b)
Electric Utilities and Infrastructure includes after-tax regulatory and legislative impairment charges of $202 million related to rate case orders, settlements or other actions of regulators or legislative bodies and an after-tax impairment charge of $46 million related to the Citrus County CC at Duke Energy Florida. See Note 4 for additional information.
(c)
Gas Utilities and Infrastructure includes an after-tax impairment charge of $42 million for the investment in Constitution. See Note 13 for additional information.
(d)
Commercial Renewables includes an impairment charge of $91 million, net of $2 million Noncontrolling interests, related to goodwill. See Note 12 for additional information.
(e)
Other includes $65 million of after-tax costs to achieve the Piedmont merger, $144 million of after-tax severance charges related to a companywide initiative and an $82 million after-tax loss on the sale of Beckjord described below. For additional information, see Note 2 for the Piedmont Merger and Note 21 for severance charges.
In February 2018, Duke Energy sold Beckjord, a nonregulated facility retired during 2014, and recorded a pretax loss of $106 million within (Losses) Gains on Sales of Other Assets and Other, net and $1 million within Operation, maintenance and other on Duke Energy's Consolidated Statements of Operations for the year ended December 31, 2018. The sale included the transfer of coal ash basins and other real property and indemnification from any and all potential future claims related to the property, whether arising under environmental laws or otherwise.
 
Year Ended December 31, 2017
 
Electric

 
Gas

 
 
 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Commercial

 
Reportable

 
 
 
 
 
 
(in millions)
Infrastructure

 
Infrastructure

 
Renewables

 
Segments

 
Other

 
Eliminations

 
Total

Unaffiliated Revenues
$
21,300

 
$
1,743

 
$
460

 
$
23,503

 
$
62

 
$
—

 
$
23,565

Intersegment Revenues
31

 
93

 
—

 
124

 
76

 
(200
)
 
—

Total Revenues
$
21,331

 
$
1,836

 
$
460

 
$
23,627

 
$
138

 
$
(200
)
 
$
23,565

Interest Expense
$
1,240

 
$
105

 
$
87

 
$
1,432

 
$
574

 
$
(20
)
 
$
1,986

Depreciation and amortization
3,010

 
231

 
155

 
3,396

 
131

 
—

 
3,527

Equity in earnings (losses) of unconsolidated affiliates
5

 
62

 
(5
)
 
62

 
57

 
—

 
119

Income tax expense (benefit)(a)
1,355

 
116

 
(628
)
 
843

 
353

 
—

 
1,196

Segment income (loss)(b)(c)(d)
3,210

 
319

 
441

 
3,970

 
(905
)
 
—

 
3,065

Add back noncontrolling interest component
  

 
  

 
  

 
  

 
  

 
  

 
5

Loss from discontinued operations, net of tax
  

 
  

 
  

 
  

 
  

 
  

 
(6
)
Net income
  

 
  

 
  

 
  

 
  

 
  

 
$
3,064

Capital investments expenditures and acquisitions
$
7,024

 
$
907

 
$
92

 
$
8,023

 
$
175

 
$
—

 
$
8,198

Segment assets
119,423

 
11,462

 
4,156

 
135,041

 
2,685

 
188

 
137,914


(a)
All segments include impacts of the Tax Act. Electric Utilities and Infrastructure includes a $231 million benefit, Gas Utilities and Infrastructure includes a $26 million benefit, Commercial Renewables includes a $442 million benefit and Other includes charges of $597 million.
(b)
Electric Utilities and Infrastructure includes after-tax regulatory settlement charges of $98 million.
(c)
Commercial Renewables includes after-tax impairment charges of $74 million related to certain wind projects and the Energy Management Solutions reporting unit. See Notes 11 and 12 for additional information.
(d)
Other includes $64 million of after-tax costs to achieve the Piedmont merger. See Note 2 for additional information.
Geographical Information
Substantially all assets and revenues from continuing operations are within the U.S.
Major Customers
For the year ended December 31, 2019, revenues from one customer of Duke Energy Progress are $635 million. Duke Energy Progress has one reportable segment, Electric Utilities and Infrastructure. No other Subsidiary Registrant has an individual customer representing more than 10% of its revenues.
Products and Services
The following table summarizes revenues of the reportable segments by type.
 
Retail

 
Wholesale

 
Retail

 
 
 
Total

(in millions)
Electric

 
Electric

 
Natural Gas

 
Other

 
Revenues

2019
 
 
 
 
 
 
 
 

Electric Utilities and Infrastructure
$
19,745

 
$
2,231

 
$
—

 
$
855

 
$
22,831

Gas Utilities and Infrastructure
—

 
—

 
1,782

 
84

 
1,866

Commercial Renewables
—

 
389

 
—

 
98

 
487

Total Reportable Segments
$
19,745

 
$
2,620

 
$
1,782


$
1,037

 
$
25,184

2018
 
 
 
 
 
 
 
 

Electric Utilities and Infrastructure
$
19,013

 
$
2,345

 
$
—

 
$
915

 
$
22,273

Gas Utilities and Infrastructure
—

 
—

 
1,817

 
64

 
1,881

Commercial Renewables
—

 
375

 
—

 
102

 
477

Total Reportable Segments
$
19,013

 
$
2,720

 
$
1,817


$
1,081

 
$
24,631

2017
 
 
 
 
 
 
 
 

Electric Utilities and Infrastructure
$
18,177

 
$
2,104

 
$
—

 
$
1,050

 
$
21,331

Gas Utilities and Infrastructure
—

 
—

 
1,732

 
104

 
1,836

Commercial Renewables
—

 
375

 
—

 
85

 
460

Total Reportable Segments
$
18,177

 
$
2,479

 
$
1,732


$
1,239

 
$
23,627


Duke Energy Ohio
Duke Energy Ohio has two reportable 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. Both reportable segments conduct 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. In December 2018, the PUCO approved an order which allows the recovery or credit of revenues and expenses related to Duke Energy Ohio's contractual arrangement to buy power from OVEC power plants. Due to the change in regulatory treatment of these amounts, OVEC revenues and expenses are now reflected in the Electric Utilities and Infrastructure segment. Previously, OVEC revenues and expense were included in Other. These amounts are deemed immaterial for Duke Energy Ohio. Therefore, no prior period amounts were restated. See Note 4 for additional information on the PUCO order.
All Duke Energy Ohio assets and revenues from continuing operations are within the U.S.
  
Year Ended December 31, 2019
 
Electric

 
Gas

 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Reportable

 
 
 
 
 
 
(in millions)  
Infrastructure

 
Infrastructure

 
Segments

 
Other

 
Eliminations

 
Total

Total revenues
$
1,456

 
$
484

 
$
1,940

 
$
—

 
$
—

 
$
1,940

Interest expense  
$
80

 
$
29

 
$
109

 
$
—

 
$
—

 
$
109

Depreciation and amortization  
182

 
83

 
265

 
—

 
—

 
265

Income tax expense (benefit)  
20

 
21

 
41

 
(1
)
 
—

 
40

Segment income (loss)/Net income
159

 
85

 
244

 
(5
)
 
—

 
239

Loss from discontinued operations, net of tax
 
 
 
 
 
 
 
 
 
 
(1
)
Net income
 
 
 
 
 
 
 
 
 
 
$
238

Capital expenditures  
$
680

 
$
272

 
$
952

 
$
—

 
$
—

 
$
952

Segment assets  
6,188

 
3,116

 
9,304

 
34

 
—

 
9,338

 
Year Ended December 31, 2018
 
Electric

 
Gas

 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Reportable

 
 
 
 
 
 
(in millions)  
Infrastructure

 
Infrastructure

 
Segments

 
Other

 
Eliminations

 
Total

Total revenues
$
1,450

 
$
506

 
$
1,956

 
$
1

 
$
—

 
$
1,957

Interest expense  
$
67

 
$
24

 
$
91

 
$
1

 
$
—

 
$
92

Depreciation and amortization  
183

 
85

 
268

 
—

 
—

 
268

Income tax expense (benefit)  
47

 
24

 
71

 
(28
)
 
—

 
43

Segment income (loss)/Net income(a)
186

 
93

 
279

 
(103
)
 
—

 
176

Capital expenditures  
$
655

 
$
172

 
$
827

 
$
—

 
$
—

 
$
827

Segment assets  
5,643

 
2,874

 
8,517

 
38

 
—

 
8,555

(a)    Other includes the loss on the sale of Beckjord, see discussion above.
 
Year Ended December 31, 2017
 
Electric

 
Gas

 
Total

 
 
 
 
 
 
 
Utilities and

 
Utilities and

 
Reportable

 
 
 
 
 
 
(in millions)  
Infrastructure

 
Infrastructure

 
Segments

 
Other

 
Eliminations

 
Total

Total revenues
$
1,373

 
$
508

 
$
1,881

 
$
42

 
$
—

 
$
1,923

Interest expense  
$
62

 
$
28

 
$
90

 
$
1

 
$
—

 
$
91

Depreciation and amortization  
178

 
83

 
261

 
—

 
—

 
261

Income tax expense (benefit)  
40

 
39

 
79

 
(20
)
 
—

 
59

Segment income (loss)
138

 
85

 
223

 
(30
)
 
—

 
193

Loss from discontinued operations, net of tax
 
 
 
 
 
 
 
 
 
 
(1
)
Net income


 


 


 


 
 
 
$
192

Capital expenditures  
$
491

 
$
195

 
$
686

 
$
—

 
$
—

 
$
686

Segment assets
5,066

 
2,758

 
7,824

 
66

 
(15
)
 
7,875