Earnings Review and Business Update November 5, 2014 Third Quarter 2014 Lynn Good, President and CEO Steve Young, Executive VP and CFO
Safe Harbor Safe Harbor statement Some of the statements in this document concerning future company performance will be forward-looking within the meanings of the securities laws. Actual results may materially differ from those…
Topics for todays call Position Core Businesses for Growth Optimize Operational Performance Announced infrastructure and Achieved record 3Q nuclear generation growth investment capacity factor opportunities of up to 5.5 Strong…
Growth initiatives underpin long-term financial objectives Growth initiatives announced during 3Q 2014 Atlantic Coast Indiana SB 560 NCEMPA Asset Regulated Pipeline Plan Purchase Renewables in NC Potential 2 billion Requested IURC…
New generation projects update 2018 Citrus County CC Florida (1.5 Billion Investment) Major Generation Projects 1,640 MW CCGT, expected online in 2018 CPCN issued by FPSC in October 2014 ( millions) 2017 Lee CC Carolinas (600 Million…
Coal ash management activities moving forward 3Q 2014 Activities Next Steps Implemented new internal Coal Combustion Products (CCP) Developing excavation plans for four high-priority sites organization to oversee ash basin facility…
Edwardsport IGCC plant operations on track Operational Status IGCC Rider Proceeding Status Tracker Costs Thru Filed Status Plant began commercial operations in June 2013 Awaiting order; expected IGCC-11 Mar. 2013 May 2013 in 1H…
Announced agreement to sell Midwest generation to Dynegy Transaction overview Zimmer Generating Station Announced sale of Midwest generation business to Dynegy for 2.8 billion in cash in August Use of proceeds could include a…
Regulated Utilities weather-normal volume trends Rolling 12 month (RTM) and YTD Regulated Load Growth Trends weather-normalized load growth is 2.6% ahead of our 2014 expectations of 0.5% growth 1.7% 1.6% 1.6% Growth by customer class…
Residential customer growth continues to outpace usage Number of residential customers continues to consistently grow at around 1% over the last 12 months Residential Customer Trends Customer growth in our jurisdictions was led by…
3Q Key Accounting Matters Coal Ash Asset Retirement Obligation Midwest Generation Business Accounting rules require the company to recognize an Announced plans to exit the Midwest generation business in Asset Retirement Obligation…
Primary 4Q 2014 EPS drivers (1) Primary 4Q 2014 year-over-year EPS drivers (1)(2) Nuclear outage cost levelization benefits Lower results in Latin America 3.69 Reduced COR amortization in Florida 0.80 - Normal weather 0.95 Higher…
Achieving long-term adjusted EPS growth of 4-6% through 2016 (1) Retail Load Growth 0.5% 4% Adjusted EPS growth Optimize Commercial highly achievable Businesses As of Sept. 30, rolling twelve month trend is with base plan…
Financial objectives for 2014 and beyond Achieve Grow revised 2014 EPS EPS 4 - 6% guidance range of through 2016 (1)(2) 4.50 - 4.65 (1) Grow Maintain strong dividend within 65 - 70% credit ratings and target payout (1)…
Update on Key 2014 Assumptions 17 Third Quarter 2014 Earnings Review and Business Update
Duke Energy value proposition Superior Total Shareholder Return (TSR) Potential Long-term EPS growth of 4-6% (1) R Attractive annual dividend yield (3.9%) (2) with growth flexibility 8-10% average annual TSR potential Strong…
Business segment structure DUKE ENERGY REGULATED COMMERCIAL INTERNATIONAL UTILITIES POWER ENERGY North and South Duke Energy Duke Energy Carolinas Carolina Renewables North and South Duke Energy Duke Energy Progress Carolina…
Update on key 2014 earnings guidance assumptions ( in millions) Original 2014 2014 YTD assumptions (1) (thru 9/30/14) Adjusted segment income (expense) (2): Regulated Utilities 2,855 2,346 International Energy 430 356 Commercial…
3Q 2014 Earnings Supplement 21 Third Quarter 2014 Earnings Review and Business Update
Regulated Utilities weather-normal volume trends 3Q 2014 weather-normalized load growth was Regulated Utilities weather-normal volume changes below full-year expectation of 0.5%, while YTD and rolling 12 month results remain ahead…
Regulated Utilities weather-normalized volume trends, by jurisdiction Q3 2014 Rolling 12-month Volume Trends Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Regulated Carolinas Progress (1) Florida Indiana Ohio/Kentucky…
Regulated Utilities quarterly weather impacts Weather segment 2014 2013 income to normal: Pretax impact Weighted avg. EPS impact Pretax impact Weighted avg. EPS impact ( in millions) diluted shares favorable / ( in millions) diluted…
Fuel and Joint Dispatch savings update Fuel and Joint Dispatch (JDA) Savings Quarterly Savings Results ( in millions) Guaranteed 687 million in fuel and joint 50 400 dispatch savings to Carolinas customers over 350 40 5 years (1)…
Open Major Regulatory Proceedings (as of November 4, 2014) Entity Filing Docket Status Intervener Staff Filing Evidentiary Expected number filings Hearings Order Ohio 2014 ESP 14-0841-EL- Intervener and PUCO Sep. 26, 2014 Oct. 2, 2014…
Edwardsport IGCC rider summary Six-Month Revenue Tracker Costs Thru (1) Rates Effective Status Requirement IGCC-1 Feb. 2008 Jan. 2009 Approved 8 million IGCC-2 Sept. 2008 May 2009 Approved 17 million IGCC-3 Mar. 2009 Dec. 2009…
Growth Investments 29 Third Quarter 2014 Earnings Review and Business Update
Growth investments of 16-20B from 2014-2018 New Generation (6-8 Billion) Infrastructure (7-9 Billion) Compliance & Other (3 Billion) Florida CC / CT SB560 in Indiana EPA regulations, Investments Grid modernization and including…
Atlantic Coast Pipeline provides DUK investment opportunity of 2 billion (1) Joint Venture Ownership Structure Next Steps and Necessary Approvals (2) Parent Company Ownership Percentage Event Timing 45% NCUC approval of affiliate…
Agreement in place to purchase NCEMPAs joint ownership Agreement to purchase the North Carolina Eastern Municipal Power Agency (NCEMPA) joint ownership in several Duke Energy Progress plants (1) Purchase price of approximately 1.2…
Growing renewables portfolio (2 billion of investments through 2018) Commercial Renewables Regulated Solar Rooftop solar installation in NC Happy Jack Wind Farm Wind North Carolina Solar RFP Construction of Los Vientos III and IV…
Duke Energy Indiana files 1.9 billion T&D infrastructure plan On August 29th, filed a seven-year T&D infrastructure improvement plan with the Indiana Utility Regulatory Commission (IURC) under the provisions of Senate Enrolled Act…
Environmental Overview 35 Third Quarter 2014 Earnings Review and Business Update
Pending environmental regulations Rule overview Potential impacts to Duke Energy Regulates Hazardous Air Pollutants (e.g., mercury & non-mercury HAPs) Additional air emissions control Mercury and Air Compliance deadline April 16,…
Pending environmental regulations, cont. Rule overview Potential impacts to Duke Energy Regulates coal combustion residuals (e.g., coal ash) Close or upgrade wet ash ponds Coal Combustion Rule proposed in June 2010 Convert wet ash…
Pending EPA regulations will impact U.S. generation Major regulations Duke Energy domestic generation (as of 9/30/14) Considerations for EPA Coal generation profile Transition period must Coal Combustion Residuals Rule (Coal Ash)…
Positioning our coal fleet for EPA regulations Coal generation profile as of 9/30/14 Plans for coal generation without controls Duke Carolinas 4.3 GW 2.5 GW 0.4 Lee 1&2 200 MW potential to be retired by 2015 7.2 GW GW Lee 3 170 MW…
Duke Energy steam facility data (As of 9/30/14) Owned capacity Current cooling Ash Handling (2) Structure Operating state Jurisdiction Steam unit facility summer rating (MW) Fuel type method Air Emissions controls (flyash; bottom ash)…
Duke Energy steam facility data, cont. (As of 9/30/14) Owned capacity Current cooling Ash Handling (3) Structure Operating state Jurisdiction Steam unit facility summer rating (MW) Fuel type method Air Emissions controls (flyash;…
Coal Ash Supplement 42 Third Quarter 2014 Earnings Review and Business Update
Ash Basins: Dedicated company website Visit: www.duke-energy.com/ash-management for up-to-date information 43 Third Quarter 2014 Earnings Review and Business Update
Ash Basins: Notice of Violations in the Carolinas Site NOV Dukes NOV Cited Violation Dukes Response Summary Next Steps Issuance Response Dan River 2/28/2014 3/13/14 Notice of unlawful discharge and potential Duke Energy was operating in…
Additional Financial Information 45 Third Quarter 2014 Earnings Review and Business Update
Established track record of dividend growth DUK has an above-average dividend yield DUK annual dividend per share (1) compared to its peer group DUK is growing the dividend annually, but at a rate slower than the growth in EPS DUK…
Simplified financing structure Duke Energy (HoldCo) Cinergy Corp. Duke Energy Progress Energy (HoldCo) International (HoldCo) (1) Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Carolinas Ohio Indiana Progress…
Progress on 2014 financing plan (as of November 4, 2014) (1) ( in millions) 2,000 1,500 1,000 500 - Duke Duke Duke International Renewables Duke Duke Energy Energy Energy Energy Energy (HoldCo)(2) Progress (3) Florida (3)…
Access to capital 2014 long-term debt financing activity Amount Credit Ratings ( in Entity Date Issued Term Type Rate (M/S&P/F) millions) Accounts Receivable Initial variable rate of 225 DE Florida March 2014 N/A 3 Year…
Liquidity summary (as of September 30, 2014) ( in millions) Duke Duke Duke Duke Duke Duke Duke Energy Carolinas Progress Florida Indiana Ohio Kentucky Total (1) 2,250 1,000 750 650 700 550 100 6,000 Master Credit Facility Less:…
Credit ratings (as of November 4, 2014) Holding companies Operating companies Fitch Moody's S&P Fitch Moody's S&P DUKE ENERGY Stable Stable Stable DUKE ENERGY CAROLINAS Positive Stable Stable Senior Unsecured Debt BBB+ A3 BBB Senior…
Investor Relations App Free mobile app for Investor Relations materials now available for iPhone, iPad, and Android mobile devices The Duke Energy app provides mobile access to commonly used IR materials, including: SEC Filings…
Upcoming events Event Date EEI Financial Conference (Dallas) November 12-13 4Q 2014 Earnings Call TBD 53 Third Quarter 2014 Earnings Review and Business Update
For additional information on Duke Energy, please visit: www.duke-energy.com/investors
Duke Energy Corporation Non-GAAP Reconciliations Third Quarter Earnings Review & Business Update November 5, 2014 Adjusted Diluted Earnings per Share (EPS) The materials for Duke Energy Corporations (Duke Energy) Third Quarter Earnings…
term targeted range of growth of 4% - 6% in adjusted diluted EPS (on a compound annual growth rate (CAGR) basis). Adjusted diluted EPS is a non-GAAP financial measure as it represents diluted EPS from continuing operations attributable to…
Commercial Power segment, or any amounts that may be reported as discontinued operations or extraordinary items for future periods. Adjusted Effective Tax Rate The materials for Duke Energys Third Quarter Earnings Review and Business…
directly comparable GAAP financial measure is not available at this time, as management is unable to project special items or mark-to-market adjustments for future periods. Available Liquidity The materials for Duke Energys Third…
DUKE ENERGY CORPORTATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Three Months Ended September 30, 2014 (Dollars in millions, except per-share amounts) Special Items Costs to Achieve, Midwest Adjusted Progress Generation…
DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Nine Months Ended September 30, 2014 (Dollars in millions, except per-share amounts) Special Items Costs to Economic Achieve, Midwest Hedges Adjusted Progress…
DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Three Months Ended September 30, 2013 (Dollars in millions, except per-share amounts) Special Items Costs to Achieve, Midwest Adjusted Progress Generation…
DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Nine Months Ended September 30, 2013 (Dollars in millions, except per-share amounts) Special Items Costs to Achieve, Nuclear Crystal River Midwest Adjusted…
Duke Energy Corporation Available Liquidity Reconciliation As of September 30, 2014 (In millions) Cash and Cash Equivalents 1,931 Short-Term Investments - Subtotal 1,931 Less: Amounts Held in Foreign Jurisdictions (1,561) Less:…
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