PROPERTY, PLANT AND EQUIPMENT

The following tables summarize the property, plant and equipment for Duke Energy and its subsidiary registrants.



	December 31, 2017
	Estimated
	Useful				Duke						Duke			Duke			Duke			Duke
	Life	Duke			Energy			Progress			Energy			Energy			Energy			Energy
(in millions)	(Years)	Energy			Carolinas			Energy			Progress			Florida			Ohio			Indiana			Piedmont
Land		$	1,559		$	467		$	767		$	424		$	343		$	134		$	111		$	41
Plant – Regulated
Electric generation, distribution and transmission	8-100	93,687			35,657			39,419			24,502			14,917			4,870			13,741			—
Natural gas transmission and distribution	12-80	8,292			—			—			—			—			2,559			—			5,733
Other buildings and improvements	15-100	1,936			647			652			316			336			243			240			154
Plant – Nonregulated
Electric generation, distribution and transmission^(a)	5-30	4,273			—			—			—			—			—			—			—
Other buildings and improvements	25-35	465			—			—			—			—			—			—			—
Nuclear fuel		3,680			2,120			1,560			1,560			—			—			—			—
Equipment	3-55	2,122			402			555			416			139			348			169			266
Construction in process		6,995			2,614			3,059			1,434			1,625			350			416			231
Other	3-40	4,498			1,032			1,311			931			370			228			271			300
Total property, plant and equipment^(b)(e)		127,507			42,939			47,323			29,583			17,730			8,732			14,948			6,725
Total accumulated depreciation – regulated^(c)(d)(e)		(39,742		)	(15,063		)	(15,857		)	(10,903		)	(4,947		)	(2,691		)	(4,662		)	(1,479		)
Total accumulated depreciation – nonregulated^(d)(e)		(1,795		)	—			—			—			—			—			—			—
Generation facilities to be retired, net		421			—			421			421			—			—			—			—
Total net property, plant and equipment		$	86,391		$	27,876		$	31,887		$	19,101		$	12,783		$	6,041		$	10,286		$	5,246


(a)	Includes a pretax impairment charge of $58 million on a wholly owned non-contracted wind project. See discussion below.

(b)

Includes capitalized leases of $1,294 million, $81 million, $272 million, $139 million, $133 million, $80 million and $35 million at Duke Energy, Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio and Duke Energy Indiana, respectively, primarily within Plant – Regulated. The Progress Energy, Duke Energy Progress and Duke Energy Florida amounts are net of $114 million, $11 million and $103 million, respectively, of accumulated amortization of capitalized leases.


(c)	Includes $2,113 million, $1,283 million, $831 million and $831 million of accumulated amortization of nuclear fuel at Duke Energy, Duke Energy Carolinas, Progress Energy and Duke Energy Progress, respectively.


(d)	Includes accumulated amortization of capitalized leases of $57 million, $11 million, $21 million and $9 million at Duke Energy, Duke Energy Carolinas, Duke Energy Ohio and Duke Energy Indiana, respectively.


(e)	Includes gross property, plant and equipment cost of consolidated VIEs of $3,941 million and accumulated depreciation of consolidated VIEs of $598 million at Duke Energy.



	December 31, 2016
	Estimated
	Useful				Duke						Duke			Duke			Duke			Duke
	Life	Duke			Energy			Progress			Energy			Energy			Energy			Energy
(in millions)	(Years)	Energy			Carolinas			Energy			Progress			Florida			Ohio			Indiana			Piedmont
Land		$	1,501		$	432		$	735		$	393		$	342		$	150		$	106		$	39
Plant – Regulated
Electric generation, distribution and transmission	8-100	89,864			34,515			37,596			23,683			13,913			4,593			13,160			—
Natural gas transmission and distribution	12-67	7,738			—			—			—			—			2,456			—			5,282
Other buildings and improvements	15-100	1,692			502			634			293			341			211			197			148
Plant – Nonregulated
Electric generation, distribution and transmission	5-30	4,298			—			—			—			—			—			—			—
Other buildings and improvements	25-35	421			—			—			—			—			—			—			—
Nuclear fuel		3,572			2,092			1,480			1,480			—			—			—			—
Equipment	3-38	1,941			358			505			378			127			338			156			260
Construction in process		6,186			2,324			2,708			1,329			1,379			206			396			210
Other	5-40	4,184			904			1,206			863			332			172			226			235
Total property, plant and equipment^(a)(d)		121,397			41,127			44,864			28,419			16,434			8,126			14,241			6,174
Total accumulated depreciation – regulated^(b)(c)(d)		(37,831		)	(14,365		)	(15,212		)	(10,561		)	(4,644		)	(2,579		)	(4,317		)	(1,360		)
Total accumulated depreciation – nonregulated^(c)(d)		(1,575		)	—			—			—			—			—			—			—
Generation facilities to be retired, net		529			—			529			529			—			—			—			—
Total net property, plant and equipment		$	82,520		$	26,762		$	30,181		$	18,387		$	11,790		$	5,547		$	9,924		$	4,814

(a)

Includes capitalized leases of $1,355 million, $40 million, $288 million, $142 million, $146 million, $81 million and $35 million at Duke Energy, Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio and Duke Energy Indiana, respectively, primarily within Plant – Regulated. The Progress Energy, Duke Energy Progress and Duke Energy Florida amounts are net of $99 million, $9 million and $90 million, respectively, of accumulated amortization of capitalized leases.


(b)	Includes $1,922 million, $1,192 million, $730 million and $730 million of accumulated amortization of nuclear fuel at Duke Energy, Duke Energy Carolinas, Progress Energy and Duke Energy Progress, respectively.


(c)	Includes accumulated amortization of capitalized leases of $50 million, $9 million, $19 million and $8 million at Duke Energy, Duke Energy Carolinas, Duke Energy Ohio and Duke Energy Indiana, respectively.


(d)	Includes gross property, plant and equipment cost of consolidated VIEs of $2,591 million and accumulated depreciation of consolidated VIEs of $411 million at Duke Energy.

During the year ended December 31, 2017, Duke Energy recorded a pretax impairment charge of $69 million on a wholly owned non-contracted wind project. The impairment was recorded within Impairment charges on Duke Energy’s Consolidated Statements of Operations. $58 million of the impairment related to property, plant and equipment and $11 million of the impairment related to a net intangible asset; see Note 11 for additional information. The charge represents the excess carrying value over the estimated fair value of the project, which was based on a Level 3 Fair Value measurement that was determined from the income approach using discounted cash flows. The impairment was primarily due to the non-contracted wind project being located in a market that has experienced continued declining market pricing during 2017 and declining long-term forecasted energy and capacity prices, driven by low natural gas prices, additional renewable generation placed in service and lack of significant load growth.

The following tables present capitalized interest, which includes the debt component of AFUDC.



	Years Ended December 31,
(in millions)	2017		2016		2015
Duke Energy	$	128	$	100	$	98
Duke Energy Carolinas	45		38		38
Progress Energy	45		31		24
Duke Energy Progress	21		17		20
Duke Energy Florida	24		14		4
Duke Energy Ohio	10		8		10
Duke Energy Indiana	9		7		6



	Year Ended		Two Months Ended		Years Ended October 31,
(in millions)	December 31, 2017		December 31, 2016		2016		2015
Piedmont	$	12	$	2	$	12	$	11

Operating Leases

Duke Energy's Commercial Renewables segment operates various renewable energy projects and sells the generated output to utilities, electric cooperatives, municipalities and commercial and industrial customers through long-term contracts. In certain situations, these long-term contracts and the associated renewable energy projects qualify as operating leases. Rental income from these leases is accounted for as Operating Revenues in the Consolidated Statements of Operations. There are no minimum lease payments as all payments are contingent based on actual electricity generated by the renewable energy projects. Contingent lease payments were $262 million, $216 million, and $172 million for the years ended December 31, 2017, 2016 and 2015. As of December 31, 2017, renewable energy projects owned by Duke Energy and accounted for as operating leases had a cost basis of $3,153 million and accumulated depreciation of $459 million. These assets are principally classified as nonregulated electric generation and transmission assets.