Duke Energy Corporation
11/05/2026 | Press release | Distributed by Public on 11/05/2026 12:32
Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following combined Management's Discussion and Analysis of Financial Condition and Results of Operations is separately filed by Duke Energy and Duke Energy Carolinas, Progress Energy, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont. However, none of the registrants make any representation as to information related solely to Duke Energy or the Subsidiary Registrants of Duke Energy other than itself.
DUKE ENERGY
Duke Energy, an energy company headquartered in Charlotte, North Carolina, operates in the U.S. primarily through its subsidiaries, Duke Energy Carolinas, Duke Energy Progress, Duke Energy Florida, Duke Energy Ohio, Duke Energy Indiana and Piedmont. Duke Energy's consolidated financial information includes the results of the Subsidiary Registrants, which along with Duke Energy, are collectively referred to as the Duke Energy Registrants.
Management's Discussion and Analysis should be read in conjunction with the Condensed Consolidated Financial Statements and Notes for the nine months ended September 30, 2026, and with Duke Energy's Annual Report on Form 10-K for the year ended December 31, 2025.
Executive Overview
During the nine months ended September 30, 2026, we continued to execute our strategy of investing in infrastructure necessary to support customer growth while maintaining reliability and financial discipline. We completed two strategic transactions that generated approximately $5.3 billion of proceeds to support future infrastructure investments, advanced key regulatory initiatives, including the planned combination of our Carolinas electric utilities, and maintained reliability amid continued growth across our service territories. These developments support our long-term capital investment plan and position us to meet increasing customer energy needs while creating long-term shareholder value.
Executing on Strategic Transactions. Our service territories continue to experience significant growth driven by economic development activity, population growth and increasing customer demand, which are expected to support substantial capital investment opportunities in the coming years. We completed two previously announced strategic transactions that enhance our financial flexibility and support funding of our long-term capital plan.
On March 3, 2026, we completed the first closing of a minority investment in Florida Progress, the holding company of Duke Energy Florida, by an affiliate of Brookfield Super-Core Infrastructure Partners. The initial investment resulted in the transfer of a 9.19% ownership interest for approximately $2.8 billion in cash proceeds. On March 31, 2026, following approval by the TPUC, we closed on the sale of Piedmont's Tennessee business to Spire Inc. and received approximately $2.5 billion in cash proceeds.
The successful execution of these transactions enhances our financial flexibility and supports funding the investments necessary to meet anticipated customer growth while maintaining disciplined capital allocation. See Note 2 to the Condensed Consolidated Financial Statements, "Dispositions," for further information.
Constructive Regulatory Outcomes. During the nine months ended September 30, 2026, we advanced key regulatory initiatives and investments to support customer growth, maintain reliable service and position our business for long-term success. These efforts remain focused on delivering safe and reliable electric and natural gas service, maintaining customer affordability and achieving timely recovery of prudent costs.
•Revised base rates became effective during the first quarter of 2026 for Duke Energy Carolinas' and Duke Energy Progress' South Carolina service territories, as well as Duke Energy Kentucky's natural gas business. Duke Energy Ohio's electric and natural gas businesses filed new base rate applications. In the third quarter, we reached settlements in Duke Energy Carolinas' and Duke Energy Progress' 2025 North Carolina rate cases and in proceedings related to Winter Storm Fern. We also received an order in Piedmont's South Carolina rate case, with new rates effective in October.
•We continued to advance our generation modernization strategy through regulatory approvals for new generation projects in South Carolina and North Carolina, including the Anderson County, Marshall and Person County facilities. These projects are expected to support growing customer demand and maintain system reliability as we modernize our generation fleet. In May, the PSCSC issued an order accepting our 2025 Carolinas systemwide resource plan, and in August, we filed our latest systemwide plan with the PSCSC.
•Our nuclear fleet continues to provide a significant source of reliable, carbon-free and cost-competitive generation. In February 2026, we announced that our nuclear fleet achieved a record systemwide capacity factor in 2025. In April 2026, the NRC issued a subsequent license renewal for Robinson, extending operations through 2050. Also during April, we executed a multiyear agreement to sell up to $3.1 billion of net tax credits through 2029, including nuclear PTCs, supporting customer affordability.
•The FERC issued an order authorizing the proposed combination of our two electric utilities operating in the Carolinas, finding the transaction consistent with the public interest. The companies also reached comprehensive settlements with intervenors in North Carolina and South Carolina and received approvals from both the NCUC and the PSCSC. The targeted effective date of the combination remains January 1, 2027.
Economic Development. Customer growth across our service territories continues to be driven by population growth, economic development activity and increasing electrification. Demand associated with data center development remains a significant contributor to projected load growth.
We continue to expand our portfolio of data center electric service agreements, increasing contracted capacity while maintaining a disciplined approach to infrastructure investment. These arrangements include financial protections designed to support system reliability, facilitate continued investment and align the costs of serving new large-load customers with the customers driving those investments. As a result, these agreements help mitigate the potential for cost impacts to other customers while supporting continued growth opportunities across our jurisdictions.
| MD&A | DUKE ENERGY | ||||
These trends continue to support Duke Energy's long-term regulated capital plan while helping maintain reliable service and customer affordability.
Operational Excellence. The safe and reliable operation of our electric generation fleet, transmission and distribution systems and natural gas infrastructure remains fundamental to serving our customers and supporting our financial performance. Operational excellence is particularly important during significant weather events when system reliability and effective service restoration are critical.
In late January 2026, Winter Storm Fern impacted all of our service territories. Sustained subfreezing temperatures drove customer energy usage to record winter peak demand levels across the Carolinas. We implemented storm preparation and response measures, including pre-positioning crews and equipment, coordinating mutual-assistance resources and leveraging established restoration processes. These efforts supported continued system reliability and restoration of service to affected customers within 48 hours.
Additionally, a summer heat wave brought extreme temperatures in August 2026, resulting in a new summertime record for electricity demand in the Carolinas, surpassing the previous record set in June 2025. Effective planning and operational execution by our generation and transmission teams supported system reliability during periods of elevated demand.
Duke Energy Objectives and Beyond. For the remainder of 2026, we remain focused on executing our strategic priorities, including advancing key regulatory initiatives, preparing for the combination of our Carolinas' electric utilities, supporting customer growth and investing in the infrastructure necessary to maintain safe and reliable service. Constructive regulatory outcomes, continued economic development, disciplined capital allocation and strong operational execution position us to support our customers and communities while creating long-term shareholder value.
See Notes 4 and 17 to the Condensed Consolidated Financial Statements, "Regulatory Matters" and "Income Taxes," respectively, along with "Other Matters," for additional information.
Matters Impacting Future Results
The matters discussed herein could materially impact the future operating results, financial condition and cash flows of the Duke Energy Registrants.
Regulatory Matters
Coal Ash Costs
In April 2024, the EPA issued the 2024 CCR Rule, which significantly expanded the scope of the 2015 CCR Rule by establishing regulatory requirements for inactive surface impoundments at retired generating facilities and previously unregulated coal ash sources at regulated facilities. Duke Energy is participating in legal challenges to the 2024 CCR Rule. In April 2026, the EPA proposed to rescind or modify certain aspects of the 2015 CCR Rule, as amended by the 2024 CCR Rule. Duke Energy is evaluating the proposed rule and its potential impact on the Company, which could be material.
Cost recovery for future expenditures is anticipated and will be pursued through the normal ratemaking process with federal and state utility commissions and through wholesale contracts which permit recovery of reasonable and prudently incurred costs associated with Duke Energy's regulated operations. For more information, see "Other Matters" and Note 4 to the Condensed Consolidated Financial Statements, "Regulatory Matters."
Supply Chain
The Company continues to monitor the ongoing stability of markets for key materials and supplies, including potential impacts on the prices or availability of goods resulting from global conflicts, geopolitical developments, restrictions on trade involving certain rare earth materials and technologies used in electric utility infrastructure or evolving trade and tariff policies. Public policy developments, including new or revised tariffs or other actions from federal executive orders, federal legislation or other rulemakings, could disrupt or impact Duke Energy's supply chain, future financial results, capital plan or execution on the Company's energy modernization strategy.
Results of Operations
Non-GAAP Measures
Management's Discussion and Analysis includes financial information prepared in accordance with GAAP in the U.S., as well as certain non-GAAP financial measures, adjusted earnings and adjusted EPS, discussed below. Non-GAAP financial measures are numerical measures of financial performance, financial position or cash flows that exclude (or include) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as a supplement to, and not a substitute for, financial measures presented in accordance with GAAP. Non-GAAP measures presented may not be comparable to similarly titled measures used by other companies because other companies may not calculate the measures in the same manner.
Management evaluates financial performance in part based on non-GAAP financial measures, including adjusted earnings and adjusted EPS. Adjusted earnings and adjusted EPS represent income from continuing operations available to Duke Energy Corporation common stockholders in dollar and basic per share amounts, adjusted for the dollar and per share impact of special items. Special items represent certain charges and credits, which management believes are not indicative of Duke Energy's ongoing performance. The most directly comparable GAAP measures for adjusted earnings and adjusted EPS are GAAP Reported Earnings (Loss) and GAAP Reported Basic Earnings (Loss) Per Share, respectively.
| MD&A | DUKE ENERGY | ||||
Special items included in the periods presented below include the following, which management believes do not reflect ongoing costs:
•Legal and Regulatory Settlements represent the impact of charges related to legal settlements as well as regulatory settlements related to the Duke Energy Carolinas' and Duke Energy Progress' North Carolina rate cases and establishment of a regulatory liability associated with an energy efficiency program at Duke Energy Carolinas and Duke Energy Progress.
•Asset Sales represent the impact of gains on sales of assets related to Piedmont's Tennessee business and certain renewable natural gas investments.
Discontinued Operations represents the resolution of an outstanding liability related to the Commercial Renewables Disposal Groups.
Three Months Ended September 30, 2026, as compared to September 30, 2025
GAAP reported and adjusted EPS was $1.99 for the three months ended September 30, 2026, compared to $1.81 for the three months ended September 30, 2025. The increase in reported and adjusted EPS was primarily due to the recovery of infrastructure investments to reliably serve customers in our growing jurisdictions and improved weather, partially offset by higher depreciation on a growing asset base, impacts from minority interest investments, higher interest expense and a higher effective tax rate.
Nine Months Ended September 30, 2026, as compared to September 30, 2025
GAAP reported EPS was $5.34 for the nine months ended September 30, 2026, compared to $4.81 for the nine months ended September 30, 2025. In addition to the drivers below, GAAP reported EPS increased primarily due to the gain on sale of Piedmont's Tennessee business, offset by charges related to legal and regulatory settlements.
As discussed above, management also evaluates financial performance based on adjusted EPS. Duke Energy's adjusted EPS was $5.35 for the nine months ended September 30, 2026, compared to $4.81 for the nine months ended September 30, 2025. The increase in adjusted EPS was primarily due to the recovery of infrastructure investments to reliably serve customers in our growing jurisdictions and improved weather, partially offset by higher depreciation on a growing asset base, higher interest expense, impacts from minority interest investments, and higher operation and maintenance expense, including storm costs.
The following table reconciles non-GAAP measures, including adjusted EPS, to their most directly comparable GAAP measures.
| Nine Months Ended September 30, | |||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||
| (in millions, except per share amounts) | Earnings | EPS | Earnings | EPS | |||||||||||||||||||
| GAAP Reported Earnings/GAAP Reported EPS | $ | 4,164 | $ | 5.34 | $ | 3,743 | $ | 4.81 | |||||||||||||||
| Adjustments: | |||||||||||||||||||||||
|
Legal and Regulatory Settlements(a)
|
189 | 0.24 | - | - | |||||||||||||||||||
|
Asset Sales(b)
|
(171) | (0.22) | - | - | |||||||||||||||||||
|
Discontinued Operations(c)
|
(13) | (0.02) | 1 | - | |||||||||||||||||||
| Adjusted Earnings/Adjusted EPS | $ | 4,169 | $ | 5.35 | $ | 3,744 | $ | 4.81 | |||||||||||||||
Note: Total EPS may not foot due to rounding.
(a)Net of $59 million tax benefit. $172 million recorded within Operations, maintenance and other, $51 million recorded within Impairments of assets and other charges and $25 million recorded within Operating Revenues.
(b) Net of $196 million tax expense, which includes the impact of nondeductible goodwill related to the sale of Piedmont's Tennessee business. $374 million recorded within Gains on Sales of Other Assets and Other, net and $7 million recorded within Property and other taxes.
(c) Recorded in Income (Loss) from Discontinued Operations, net of tax.
SEGMENT RESULTS
The remaining information presented in this discussion of results of operations is on a GAAP basis. Management evaluates segment performance based on segment income. Segment income is defined as income from continuing operations net of income attributable to NCI and preferred stock dividends. Segment income includes intercompany revenues and expenses that are eliminated on the Condensed Consolidated Financial Statements.
Duke Energy's segment structure includes the following segments: EU&I and GU&I. The remainder of Duke Energy's operations is presented as Other. See Note 3 to the Condensed Consolidated Financial Statements, "Business Segments," for additional information on Duke Energy's segment structure.
| MD&A | SEGMENT RESULTS - ELECTRIC UTILITIES AND INFRASTRUCTURE | ||||
Electric Utilities and Infrastructure
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | 2026 | 2025 | Variance | |||||||||||||||||||||||||||||
| Operating Revenues | $ | 8,747 | $ | 8,180 | $ | 567 | $ | 23,800 | $ | 22,365 | $ | 1,435 | |||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
| Fuel used in electric generation and purchased power | 2,756 | 2,309 | 447 | 7,129 | 6,326 | 803 | |||||||||||||||||||||||||||||
| Operation, maintenance and other | 1,349 | 1,728 | (379) | 4,397 | 4,746 | (349) | |||||||||||||||||||||||||||||
| Depreciation and amortization | 1,520 | 1,448 | 72 | 4,532 | 4,184 | 348 | |||||||||||||||||||||||||||||
| Property and other taxes | 396 | 394 | 2 | 1,132 | 1,143 | (11) | |||||||||||||||||||||||||||||
| Impairment of assets and other charges | (2) | (1) | (1) | 47 | (2) | 49 | |||||||||||||||||||||||||||||
| Total operating expenses | 6,019 | 5,878 | 141 | 17,237 | 16,397 | 840 | |||||||||||||||||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 6 | 12 | (6) | 13 | 21 | (8) | |||||||||||||||||||||||||||||
| Operating Income | 2,734 | 2,314 | 420 | 6,576 | 5,989 | 587 | |||||||||||||||||||||||||||||
| Other Income and Expenses, net | 154 | 164 | (10) | 446 | 461 | (15) | |||||||||||||||||||||||||||||
| Interest Expense | 592 | 522 | 70 | 1,765 | 1,587 | 178 | |||||||||||||||||||||||||||||
| Income Before Income Taxes | 2,296 | 1,956 | 340 | 5,257 | 4,863 | 394 | |||||||||||||||||||||||||||||
| Income Tax Expense | 394 | 264 | 130 | 750 | 653 | 97 | |||||||||||||||||||||||||||||
| Less: Net Income Attributable to NCI | 85 | 34 | 51 | 165 | 82 | 83 | |||||||||||||||||||||||||||||
| Segment Income | $ | 1,817 | $ | 1,658 | $ | 159 | $ | 4,342 | $ | 4,128 | $ | 214 | |||||||||||||||||||||||
| Duke Energy Carolinas GWh sales | 27,274 | 25,316 | 1,958 | 73,262 | 71,042 | 2,220 | |||||||||||||||||||||||||||||
| Duke Energy Progress GWh sales | 20,740 | 18,871 | 1,869 | 56,467 | 54,114 | 2,353 | |||||||||||||||||||||||||||||
| Duke Energy Florida GWh sales | 13,257 | 13,038 | 219 | 34,315 | 33,832 | 483 | |||||||||||||||||||||||||||||
| Duke Energy Ohio GWh sales | 7,215 | 6,951 | 264 | 19,357 | 18,729 | 628 | |||||||||||||||||||||||||||||
| Duke Energy Indiana GWh sales | 8,661 | 8,704 | (43) | 23,642 | 24,566 | (924) | |||||||||||||||||||||||||||||
| Total Electric Utilities and Infrastructure GWh sales | 77,147 | 72,880 | 4,267 | 207,043 | 202,283 | 4,760 | |||||||||||||||||||||||||||||
| Net proportional MW capacity in operation | 55,944 | 55,270 | 674 | ||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2026, as compared to September 30, 2025
EU&I's results were primarily driven by higher revenues from rate cases across multiple jurisdictions, higher weather-normal retail sales volumes and lower operation and maintenance expenses, partially offset by higher depreciation expense and interest expense. The following is a detailed discussion of the variance drivers by line item.
Operating Revenues. The variance was driven primarily by:
•a $327 million increase in fuel revenues primarily due to net higher fuel rates and volumes in the current year;
•a $166 million increase due to higher pricing from rate cases across jurisdictions;
•a $150 million increase in rider revenue primarily due to the North Carolina storm securitization rider and the EDIT rider at Duke Energy Carolinas and Duke Energy Progress and higher rates for the SPP at Duke Energy Florida;
•a $107 million increase in weather-normal retail sales volumes; and
•a $78 million increase in retail sales due to improved weather compared to the prior year.
Partially offset by:
•a $341 million decrease in storm recovery revenues at Duke Energy Florida.
Operating Expenses. The variance was driven primarily by:
•a $447 million increase in fuel used in electric generation and purchased power primarily due to higher purchased power costs and the current year retirement of renewable energy credits at Duke Energy Progress and Duke Energy Carolinas, partially offset by lower fuel cost recovery; and
•a $72 million increase in depreciation and amortization primarily due to higher depreciable base across all jurisdictions, the impact of new rates implemented by jurisdictional rate cases and the current year retirement of renewable energy credits at Duke Energy Progress and Duke Energy Carolinas.
Partially offset by:
•a $379 million decrease in operation, maintenance and other primarily due to lower storm amortization at Duke Energy Florida.
| MD&A | SEGMENT RESULTS - ELECTRIC UTILITIES AND INFRASTRUCTURE | ||||
Interest Expense. The increase was primarily due to higher outstanding debt balances across jurisdictions, and higher accrued financing costs associated with deferred nuclear PTC liabilities, partially offset by higher AFUDC debt base compared to the prior year at Duke Energy Carolinas.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income and a decrease in the amortization of EDIT. The ETRs for the three months ended September 30, 2026, and 2025, were 17.2% and 13.5%, respectively. The increase in the ETR was primarily due to a decrease in the amortization of EDIT.
Net Income Attributable to NCI. The increase was primarily due to the first closing of a minority interest investment in Florida Progress by Brookfield Super-Core Infrastructure Partners.
Nine Months Ended September 30, 2026, as compared to September 30, 2025
EU&I's results were primarily driven by higher revenues from rate cases across multiple jurisdictions, higher rider revenues, higher weather-normal retail sales volumes and lower operation and maintenance expenses, partially offset by higher depreciation expenses. The following is a detailed discussion of the variance drivers by line item.
Operating Revenues. The variance was driven primarily by:
•a $758 million increase in fuel revenues primarily due to net higher fuel rates and volumes in the current year;
•a $485 million increase due to higher pricing from rate cases across jurisdictions;
•a $229 million increase in rider revenues primarily due to the North Carolina storm securitization rider and the EDIT rider at Duke Energy Carolinas and Duke Energy Progress and higher rates for the SPP at Duke Energy Florida;
•a $224 million increase in weather-normal retail sales volumes;
•a $95 million increase in retail sales due to improved weather compared to the prior year;
•a $78 million increase in wholesale revenues, net of fuel, due to higher capacity volumes and rates at Duke Energy Progress; and
•a $68 million increase in other revenues primarily due to higher transmission revenues at Duke Energy Florida, Duke Energy Progress and Duke Energy Ohio and favorable Ohio Valley Electric Corporation (OVEC) results due to PJM prices.
Partially offset by:
•a $602 million decrease in storm recovery revenues at Duke Energy Florida.
Operating Expenses. The variance was driven primarily by:
•an $803 million increase in fuel used in electric generation and purchased power primarily due to higher natural gas prices and higher purchased power costs, partially offset by lower fuel cost recovery;
•a $348 million increase in depreciation and amortization primarily due to higher depreciable base across jurisdictions and higher depreciation rates driven by rate cases; and
•a $49 million increase in impairment of assets and other charges primarily due to regulatory settlements related to the 2025 North Carolina rate cases.
Partially offset by:
•a $349 million decrease in operation, maintenance and other primarily due to lower storm amortization at Duke Energy Florida, partially offset by increased costs related to a legal settlement, higher storm costs in the current year associated with Winter Storm Fern, higher nuclear outage costs at Duke Energy Progress and Duke Energy Carolinas and higher costs related to customer products and services programs at Duke Energy Progress.
Interest Expense. The increase was primarily due to higher outstanding debt balances across jurisdictions and higher accrued financing costs associated with deferred nuclear PTC liabilities, partially offset by higher AFUDC debt base compared to the prior year at Duke Energy Carolinas.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income and a decrease in the amortization of EDIT, partially offset by an increase in the amortization of nuclear PTCs. The ETRs for the nine months ended September 30, 2026, and 2025, were 14.3% and 13.4%, respectively.
Net Income Attributable to NCI. The increase was primarily due to the first closing of a minority interest investment in Florida Progress by Brookfield Super-Core Infrastructure Partners.
| MD&A | SEGMENT RESULTS - GAS UTILITIES AND INFRASTRUCTURE | ||||
Gas Utilities and Infrastructure
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | 2026 | 2025 | Variance | |||||||||||||||||||||||||||||
| Operating Revenues | $ | 390 | $ | 394 | $ | (4) | $ | 2,172 | $ | 2,027 | $ | 145 | |||||||||||||||||||||||
| Operating Expenses | |||||||||||||||||||||||||||||||||||
| Cost of natural gas | 117 | 110 | 7 | 772 | 642 | 130 | |||||||||||||||||||||||||||||
| Operation, maintenance and other | 114 | 125 | (11) | 376 | 379 | (3) | |||||||||||||||||||||||||||||
| Depreciation and amortization | 107 | 106 | 1 | 332 | 325 | 7 | |||||||||||||||||||||||||||||
| Property and other taxes | 35 | 41 | (6) | 120 | 129 | (9) | |||||||||||||||||||||||||||||
| Total operating expenses | 373 | 382 | (9) | 1,600 | 1,475 | 125 | |||||||||||||||||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | - | - | - | 374 | - | 374 | |||||||||||||||||||||||||||||
| Operating Income | 17 | 12 | 5 | 946 | 552 | 394 | |||||||||||||||||||||||||||||
| Other Income and Expenses, net | 19 | 19 | - | 57 | 51 | 6 | |||||||||||||||||||||||||||||
| Interest Expense | 63 | 67 | (4) | 191 | 197 | (6) | |||||||||||||||||||||||||||||
| Income (Loss) Before Income Taxes | (27) | (36) | 9 | 812 | 406 | 406 | |||||||||||||||||||||||||||||
| Income Tax Expense (Benefit) | (8) | (10) | 2 | 289 | 77 | 212 | |||||||||||||||||||||||||||||
| Segment Income (Loss) | $ | (19) | $ | (26) | $ | 7 | $ | 523 | $ | 329 | $ | 194 | |||||||||||||||||||||||
| Piedmont LDC throughput (dekatherms) | 162,597,821 | 150,368,042 | 12,229,779 | 479,543,610 | 457,572,934 | 21,970,676 | |||||||||||||||||||||||||||||
| Duke Energy Midwest LDC throughput (Mcf) | 9,527,094 | 9,505,511 | 21,583 | 58,452,917 | 63,843,944 | (5,391,027) | |||||||||||||||||||||||||||||
Three Months Ended September 30, 2026, as compared to September 30, 2025
GU&I's results were primarily driven by growth in capital riders and lower operating expenses. The following is a detailed discussion of the variance drivers by line item.
Operating Revenues. The variance was driven primarily by:
•a $17 million decrease due to lower revenues as a result of the sale of Piedmont's Tennessee business.
Partially offset by:
•a $7 million increase in cost of natural gas revenues primarily due to higher commodity prices; and
•a $5 million increase in Midwest rider revenue.
Operating Expenses. The variance was driven primarily by:
•an $11 million decrease in operations, maintenance and other primarily due to lower expenses as a result of the sale of Piedmont's Tennessee business and lower shared services costs.
Partially offset by:
•a $7 million increase in cost of natural gas due to higher commodity prices.
Income Tax Expense (Benefit). The decrease in tax benefit was primarily due to a decrease in pretax losses. The ETRs for the three months ended September 30, 2026, and 2025, were 29.6% and 27.8%, respectively.
Nine Months Ended September 30, 2026, as compared to September 30, 2025
GU&I's results were primarily driven by the gain on sale of Piedmont's Tennessee business and growth in capital riders. The following is a detailed discussion of the variance drivers by line item.
Operating Revenues. The variance was driven primarily by:
•a $130 million increase in cost of natural gas revenues primarily due to higher commodity prices;
•a $24 million increase due to the North Carolina Integrity Management Rider (IMR), South Carolina Rate Stabilization Act rate adjustments and secondary marketing sales;
•a $19 million increase in Midwest rider revenue; and
•an $11 million increase primarily due to higher pricing from the 2025 Duke Energy Kentucky natural gas rate case.
Partially offset by:
•a $43 million decrease due to lower revenues as a result of the sale of Piedmont's Tennessee business.
| MD&A | SEGMENT RESULTS - GAS UTILITIES AND INFRASTRUCTURE | ||||
Operating Expenses. The variance was driven primarily by:
•a $130 million increase in the cost of natural gas primarily due to higher commodity prices.
Partially offset by:
•a $9 million decrease in property and other taxes primarily due to lower franchise taxes.
Gains (Losses) on Sales of Other Assets and Other, net. The increase was primarily due to the sale of Piedmont's Tennessee business, net of allocated goodwill.
Income Tax Expense (Benefit). The increase in tax expense was primarily due to an increase in pretax income and non-deductible goodwill associated with the sale of Piedmont's Tennessee business. The ETRs for the nine months ended September 30, 2026, and 2025, were 35.6% and 19.0%, respectively. The increase in the ETR was primarily due to non-deductible goodwill associated with the sale of Piedmont's Tennessee business.
Other
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | 2026 | 2025 | Variance | |||||||||||||||||||||||||||||
| Operating Revenues | $ | 41 | $ | 40 | $ | 1 | $ | 123 | $ | 122 | $ | 1 | |||||||||||||||||||||||
| Operating Expenses | 55 | 43 | 12 | 156 | 187 | (31) | |||||||||||||||||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 6 | 5 | 1 | 18 | 16 | 2 | |||||||||||||||||||||||||||||
|
Operating Gain (Loss)
|
(8) | 2 | (10) | (15) | (49) | 34 | |||||||||||||||||||||||||||||
| Other Income and Expenses, net | 17 | 40 | (23) | 88 | 102 | (14) | |||||||||||||||||||||||||||||
| Interest Expense | 329 | 332 | (3) | 991 | 968 | 23 | |||||||||||||||||||||||||||||
| Loss Before Income Taxes | (320) | (290) | (30) | (918) | (915) | (3) | |||||||||||||||||||||||||||||
| Income Tax Benefit | (87) | (79) | (8) | (247) | (243) | (4) | |||||||||||||||||||||||||||||
| Less: Preferred Dividends | 14 | 14 | - | 43 | 41 | 2 | |||||||||||||||||||||||||||||
| Net Loss | $ | (247) | $ | (225) | $ | (22) | $ | (714) | $ | (713) | $ | (1) | |||||||||||||||||||||||
Three Months Ended September 30, 2026, as compared to September 30, 2025
Other's results were primarily driven by higher insurance claims at Bison and lower returns on investments that fund certain employee benefit obligations.
Operating Expenses. The increase was primarily driven by higher captive insurance losses, partially offset by lower contributions to the Duke Energy Foundation.
Other Income and Expenses, net. The decrease was primarily driven by lower returns on investments that fund certain employee benefit obligations.
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Other's results were primarily driven by lower returns on investments that fund certain employee benefit obligations and higher interest expense, partially offset by lower contributions to the Duke Energy Foundation.
Operating Expenses. The decrease was primarily due to lower contributions to the Duke Energy Foundation.
Other Income and Expenses, net. The decrease was primarily driven by lower returns on investments that fund certain employee benefit obligations.
Interest Expense. The increase was primarily due to higher outstanding debt balances.
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | 2026 | 2025 | Variance | |||||||||||||||||||||||||||||
| Income (Loss) From Discontinued Operations, net of tax | $ | - | $ | - | $ | - | $ | 13 | $ | (1) | $ | 14 | |||||||||||||||||||||||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
The variance was primarily due to the resolution of an outstanding liability related to the Commercial Renewables Disposal Groups.
| MD&A | DUKE ENERGY CAROLINAS | ||||
DUKE ENERGY CAROLINAS
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 8,237 | $ | 7,387 | $ | 850 | |||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 2,522 | 2,080 | 442 | ||||||||||||||
| Operation, maintenance and other | 1,585 | 1,471 | 114 | ||||||||||||||
| Depreciation and amortization | 1,564 | 1,402 | 162 | ||||||||||||||
| Property and other taxes | 297 | 283 | 14 | ||||||||||||||
| Impairment of assets and other charges | 27 | - | 27 | ||||||||||||||
| Total operating expenses | 5,995 | 5,236 | 759 | ||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 5 | 6 | (1) | ||||||||||||||
| Operating Income | 2,247 | 2,157 | 90 | ||||||||||||||
| Other Income and Expenses, net | 217 | 187 | 30 | ||||||||||||||
| Interest Expense | 666 | 584 | 82 | ||||||||||||||
| Income Before Income Taxes | 1,798 | 1,760 | 38 | ||||||||||||||
| Income Tax Expense | 167 | 138 | 29 | ||||||||||||||
| Net Income | $ | 1,631 | $ | 1,622 | $ | 9 | |||||||||||
The following table shows the percent changes in GWh sales and average number of customers. The percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
| Increase (Decrease) over prior year | 2026 | ||||
| Residential sales | 4.4 | % | |||
|
Commercial sales
|
2.6 | % | |||
| Industrial sales | (0.7) | % | |||
| Wholesale power sales | 1.8 | % | |||
| Joint dispatch sales | 7.5 | % | |||
| Total sales | 3.1 | % | |||
| Average number of customers | 1.7 | % | |||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $442 million increase in fuel revenues due to higher fuel rates and volumes;
•a $129 million increase in weather-normal retail sales volumes;
•a $120 million increase due to higher pricing, including the nuclear PTC decrement rider, from the impacts of new rates implemented for the North Carolina MYRP and the 2025 South Carolina rate case;
•a $104 million increase in rider revenues primarily due to the North Carolina storm securitization rider and the EDIT rider, which ended June 1, 2026, in North Carolina and had higher rates in South Carolina; and
•a $60 million increase in retail sales due to improved weather compared to the prior year.
Operating Expenses. The variance was driven primarily by:
•a $442 million increase in fuel used in electric generation and purchased power primarily due to higher purchased power costs, including JDA, and natural gas prices, partially offset by lower fuel cost recovery;
•a $162 million increase in depreciation and amortization primarily due to higher depreciable base and the impact of new rates implemented for the North Carolina MYRP;
•a $114 million increase in operation, maintenance and other primarily due to increased costs related to a legal settlement, higher storm costs in the current year associated with Winter Storm Fern and higher outage costs;
•a $27 million increase in impairment of assets and other charges primarily due to regulatory settlements related to the 2025 North Carolina rate case; and
•a $14 million increase in property and other taxes primarily due to a higher base upon which property taxes are levied, partially offset by higher tax refunds.
| MD&A | DUKE ENERGY CAROLINAS | ||||
Other Income and expenses, net. The increase was primarily due to higher AFUDC equity base compared to the prior year, partially offset by higher non-service pension costs.
Interest Expense. The increase was primarily due to higher outstanding debt balances and higher accrued financing costs associated with deferred nuclear PTC liabilities, partially offset by higher AFUDC debt base compared to the prior year.
Income Tax Expense. The increase in tax expense was primarily due to a decrease in the amortization of EDIT and higher pretax income, partially offset by an increase in the amortization of nuclear PTCs.
PROGRESS ENERGY
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 11,507 | $ | 11,110 | $ | 397 | |||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 3,667 | 3,306 | 361 | ||||||||||||||
| Operation, maintenance and other | 2,074 | 2,475 | (401) | ||||||||||||||
| Depreciation and amortization | 2,086 | 1,910 | 176 | ||||||||||||||
| Property and other taxes | 524 | 548 | (24) | ||||||||||||||
| Impairment of assets and other charges | 20 | (2) | 22 | ||||||||||||||
| Total operating expenses | 8,371 | 8,237 | 134 | ||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 23 | 19 | 4 | ||||||||||||||
| Operating Income | 3,159 | 2,892 | 267 | ||||||||||||||
| Other Income and Expenses, net | 194 | 209 | (15) | ||||||||||||||
| Interest Expense | 890 | 830 | 60 | ||||||||||||||
| Income Before Income Taxes | 2,463 | 2,271 | 192 | ||||||||||||||
| Income Tax Expense | 407 | 361 | 46 | ||||||||||||||
| Net Income | 2,056 | 1,910 | 146 | ||||||||||||||
| Less: Net Income Attributable to NCI | 70 | - | 70 | ||||||||||||||
|
Net Income Attributable to Progress Energy
|
$ | 1,986 | $ | 1,910 | $ | 76 | |||||||||||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $401 million increase in fuel revenues primarily due to higher fuel rates and volumes;
•a $208 million increase due to higher pricing from the new rates implemented for the North Carolina MYRP and the 2025 South Carolina rate case at Duke Energy Progress and Year 2 of the 2024 Duke Energy Florida rate case;
•a $109 million increase in rider revenues primarily due to higher rates for the SPP at Duke Energy Florida, the North Carolina storm securitization rider and the EDIT rider which ended June 1, 2026, in North Carolina and had higher rates in South Carolina, partially offset by the NCEMPA rider at Duke Energy Progress;
•a $73 million increase in weather-normal retail sales volumes;
•a $57 million increase in wholesale revenues, net of fuel, due to higher capacity volumes and rates at Duke Energy Progress;
•a $54 million increase in other revenues due to higher transmission revenues from higher rates; and
•a $44 million increase in retail sales due to improved weather compared to the prior year.
Partially offset by:
•a $602 million decrease in storm recovery revenues at Duke Energy Florida.
Operating Expenses. The variance was driven primarily by:
•a $361 million increase in fuel used in electric generation and purchased power primarily due to higher natural gas prices and purchased power costs at Duke Energy Progress and higher fuel costs and increased generation from coal units at Duke Energy Florida, partially offset by lower fuel cost recovery at Duke Energy Progress;
•a $176 million increase in depreciation and amortization due to higher depreciable base at Duke Energy Progress and Duke Energy Florida and the impacts of new rates implemented for the North Carolina MYRP at Duke Energy Progress; and
•a $22 million increase in impairment of assets and other charges primarily due to regulatory settlements related to the 2025 North Carolina rate case.
| MD&A | PROGRESS ENERGY | ||||
Partially offset by:
•a $401 million decrease in operation, maintenance and other primarily due to lower storm amortization at Duke Energy Florida, partially offset by increased costs related to a legal settlement and customer products and services programs, higher storm costs in the current year associated with Winter Storm Fern and higher nuclear outage costs at Duke Energy Progress; and
•a $24 million decrease in property and other taxes due to franchise tax refunds received in the current year at Duke Energy Progress.
Other Income and Expenses, net. The decrease was primarily due to higher non-service pension costs at Duke Energy Florida.
Interest Expense. The increase was primarily due to higher outstanding debt balances.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income.
Net Income Attributable to NCI. The increase was due to the first closing of a minority interest investment in Florida Progress by Brookfield Super-Core Infrastructure Partners.
DUKE ENERGY PROGRESS
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 6,343 | $ | 5,612 | $ | 731 | |||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 2,254 | 1,928 | 326 | ||||||||||||||
| Operation, maintenance and other | 1,258 | 1,100 | 158 | ||||||||||||||
| Depreciation and amortization | 1,143 | 1,049 | 94 | ||||||||||||||
| Property and other taxes | 134 | 159 | (25) | ||||||||||||||
| Impairment of assets and other charges | 20 | (2) | 22 | ||||||||||||||
| Total operating expenses | 4,809 | 4,234 | 575 | ||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 1 | 1 | - | ||||||||||||||
| Operating Income | 1,535 | 1,379 | 156 | ||||||||||||||
| Other Income and Expenses, net | 139 | 142 | (3) | ||||||||||||||
| Interest Expense | 414 | 392 | 22 | ||||||||||||||
| Income Before Income Taxes | 1,260 | 1,129 | 131 | ||||||||||||||
| Income Tax Expense | 191 | 151 | 40 | ||||||||||||||
|
Net Income
|
$ | 1,069 | $ | 978 | $ | 91 | |||||||||||
The following table shows the percent changes in GWh sales and average number of customers. The percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
| Increase (Decrease) over prior period | 2026 | ||||
| Residential sales | 4.5 | % | |||
|
Commercial sales
|
2.6 | % | |||
| Industrial sales | (3.6) | % | |||
| Wholesale power sales | 4.8 | % | |||
| Joint dispatch sales | 10.3 | % | |||
| Total sales | 4.3 | % | |||
| Average number of customers | 1.6 | % | |||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $372 million increase in fuel revenues due to higher fuel rates and volumes;
•a $129 million increase due to higher pricing from the impacts of new rates implemented for the North Carolina MYRP and the 2025 South Carolina rate case;
•a $53 million increase in wholesale revenues, net of fuel, due to higher capacity volumes and rates;
•a $53 million increase in weather-normal retail sales volumes;
•a $42 million increase in rider revenues primarily due to the North Carolina storm securitization rider and the EDIT rider, which ended June 1, 2026, in North Carolina and had higher rates in South Carolina, partially offset by the NCEMPA rider; and
•a $32 million increase in retail sales due to improved weather compared to the prior year.
| MD&A | DUKE ENERGY PROGRESS | ||||
Operating Expenses. The variance was driven primarily by:
•a $326 million increase in fuel used in electric generation and purchased power primarily due to higher natural gas prices and purchased power costs, including JDA purchases, partially offset by lower fuel cost recovery;
•a $158 million increase in operation, maintenance and other primarily due to increased costs related to a legal settlement and customer products and services programs, higher storm costs in the current year associated with Winter Storm Fern and higher nuclear outage costs;
•a $94 million increase in depreciation and amortization primarily due to higher depreciable base and the impacts of new rates implemented for the North Carolina MYRP; and
•a $22 million increase in impairment of assets and other charges primarily due to regulatory settlements related to the 2025 North Carolina rate case.
Partially offset by:
•a $25 million decrease in property and other taxes due to franchise tax refunds received in the current year.
Interest Expense. The increase was driven primarily by higher outstanding debt balances.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income and a decrease in the amortization of EDIT.
DUKE ENERGY FLORIDA
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 5,154 | $ | 5,486 | $ | (332) | |||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 1,413 | 1,378 | 35 | ||||||||||||||
| Operation, maintenance and other | 807 | 1,365 | (558) | ||||||||||||||
| Depreciation and amortization | 943 | 861 | 82 | ||||||||||||||
| Property and other taxes | 390 | 389 | 1 | ||||||||||||||
| Total operating expenses | 3,553 | 3,993 | (440) | ||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 5 | 2 | 3 | ||||||||||||||
| Operating Income | 1,606 | 1,495 | 111 | ||||||||||||||
| Other Income and Expenses, net | 51 | 67 | (16) | ||||||||||||||
| Interest Expense | 389 | 352 | 37 | ||||||||||||||
| Income Before Income Taxes | 1,268 | 1,210 | 58 | ||||||||||||||
| Income Tax Expense | 240 | 235 | 5 | ||||||||||||||
| Net Income | $ | 1,028 | $ | 975 | $ | 53 | |||||||||||
The following table shows the percent changes in GWh sales and average number of customers. The percentages for retail customer classes represent billed sales only. Wholesale power sales include both billed and unbilled sales. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
| Increase (Decrease) over prior period | 2026 | ||||
| Residential sales | 2.4 | % | |||
|
Commercial sales
|
1.4 | % | |||
| Industrial sales | (4.3) | % | |||
| Wholesale power sales | (0.6) | % | |||
| Total sales | 1.4 | % | |||
| Average number of customers | 1.4 | % | |||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $602 million decrease in storm recovery revenues.
| MD&A | DUKE ENERGY FLORIDA | ||||
Partially offset by:
•a $79 million increase due to higher pricing from Year 2 of the 2024 Florida rate case;
•a $67 million increase in rider revenues primarily due to higher rates for the SPP;
•a $48 million increase in other revenues primarily due to higher transmission revenues from higher rates;
•a $30 million increase in fuel revenues primarily due to higher rates;
•a $20 million increase in weather-normal retail sales volumes; and
•a $12 million increase in retail sales due to improved weather compared to the prior year.
Operating Expenses. The variance was driven primarily by:
•a $558 million decrease in operation, maintenance and other primarily due to lower storm amortization.
Partially offset by:
•an $82 million increase in depreciation and amortization primarily due to higher depreciable base; and
•a $35 million increase in fuel used in electric generation and purchased power primarily due to higher fuel costs and increased generation from coal units.
Other Income and Expenses, net. The decrease was primarily due to higher non-service pension costs.
Interest Expense. The increase was primarily due to higher outstanding debt balances.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income, partially offset by an increase in solar PTCs.
DUKE ENERGY OHIO
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | |||||||||||||||||
| Regulated electric | $ | 1,661 | $ | 1,546 | $ | 115 | |||||||||||
| Regulated natural gas | 601 | 553 | 48 | ||||||||||||||
| Total operating revenues | 2,262 | 2,099 | 163 | ||||||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 496 | 485 | 11 | ||||||||||||||
| Cost of natural gas | 169 | 148 | 21 | ||||||||||||||
| Operation, maintenance and other | 414 | 366 | 48 | ||||||||||||||
| Depreciation and amortization | 355 | 353 | 2 | ||||||||||||||
| Property and other taxes | 341 | 326 | 15 | ||||||||||||||
| Total operating expenses | 1,775 | 1,678 | 97 | ||||||||||||||
| Gain (Losses) on Sales of Other Assets and Other, net | 2 | - | 2 | ||||||||||||||
| Operating Income | 489 | 421 | 68 | ||||||||||||||
| Other Income and Expenses, net | 14 | 18 | (4) | ||||||||||||||
| Interest Expense | 159 | 150 | 9 | ||||||||||||||
| Income Before Income Taxes | 344 | 289 | 55 | ||||||||||||||
|
Income Tax Expense
|
63 | 47 | 16 | ||||||||||||||
| Net Income | $ | 281 | $ | 242 | $ | 39 | |||||||||||
| MD&A | DUKE ENERGY OHIO | ||||
The following table shows the percent changes in GWh sales of electricity, dekatherms of natural gas delivered and average number of electric and natural gas customers. The percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
| Electric | Natural Gas | |||||||
| Increase (Decrease) over prior year | 2026 | 2026 | ||||||
| Residential sales | 2.2 | % | (11.7) | % | ||||
|
Commercial sales
|
2.3 | % | (4.1) | % | ||||
| Industrial sales | (4.1) | % | (8.7) | % | ||||
| Wholesale electric power sales | 118.7 | % | n/a | |||||
| Other natural gas sales | n/a | (6.9) | % | |||||
| Total sales | 3.4 | % | (8.4) | % | ||||
| Average number of customers | 0.6 | % | 0.4 | % | ||||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $42 million increase primarily due to higher pricing from the 2024 Duke Energy Kentucky electric rate case and the 2025 Duke Energy Kentucky natural gas rate case;
•a $40 million increase in fuel-related revenues primarily due to higher natural gas costs passed through to customers, partially offset by lower natural gas retail sales volumes;
•a $40 million increase in retail revenue riders primarily due to the Distribution Capital Investment Rider, Ohio CEP Rider, Base Transmission Rider and Pipeline Modernization Mechanism Rider;
•a $30 million increase in Bulk Power Marketing sales; and
•a $10 million increase in weather-normal retail sales volumes.
Partially offset by:
•a $14 million decrease in OVEC rider recoveries.
Operating Expenses. The variance was driven primarily by:
•a $48 million increase in operation, maintenance and other primarily due to higher costs associated with environmental remediation and compliance activities, higher bad debt expense and higher storm costs;
•a $32 million increase in fuel expense primarily due to higher retail prices for natural gas and purchased power; and
•a $15 million increase in property and other taxes primarily due to a higher base upon which property taxes are levied and higher franchise taxes.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income.
DUKE ENERGY INDIANA
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 2,935 | $ | 2,671 | $ | 264 | |||||||||||
| Operating Expenses | |||||||||||||||||
| Fuel used in electric generation and purchased power | 1,000 | 803 | 197 | ||||||||||||||
| Operation, maintenance and other | 515 | 601 | (86) | ||||||||||||||
| Depreciation and amortization | 631 | 617 | 14 | ||||||||||||||
| Property and other taxes | 48 | 44 | 4 | ||||||||||||||
| Total operating expenses | 2,194 | 2,065 | 129 | ||||||||||||||
| Operating Income | 741 | 606 | 135 | ||||||||||||||
| Other Income and Expenses, net | 33 | 46 | (13) | ||||||||||||||
| Interest Expense | 220 | 182 | 38 | ||||||||||||||
| Income Before Income Taxes | 554 | 470 | 84 | ||||||||||||||
|
Income Tax Expense
|
75 | 60 | 15 | ||||||||||||||
| Net Income | $ | 479 | $ | 410 | $ | 69 | |||||||||||
| MD&A | DUKE ENERGY INDIANA | ||||
The following table shows the percent changes in GWh sales and average number of customers. The percentages for retail customer classes represent billed sales only. Total sales includes billed and unbilled retail sales and wholesale sales to incorporated municipalities, public and private utilities and power marketers. Amounts are not weather-normalized.
| Increase (Decrease) over prior year | 2026 | ||||
| Residential sales | 0.8 | % | |||
|
Commercial sales
|
0.9 | % | |||
| Industrial sales | 4.1 | % | |||
| Wholesale power sales | (31.5) | % | |||
| Total sales | (3.8) | % | |||
| Average number of customers | 1.1 | % | |||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $153 million increase in fuel revenues primarily due to higher retail fuel rates; and
•a $135 million increase primarily due to higher pricing from the 2024 Indiana rate case, net of certain rider revenues moving to base.
Partially offset by:
•a $27 million decrease in wholesale revenues, including fuel, primarily due to the expiration of wholesale customer contracts.
Operating Expenses. The variance was driven primarily by:
•a $197 million increase in fuel used in electric generation and purchased power primarily due to higher natural gas, purchased power and coal costs, as well as higher amortization of deferred fuel and Midcontinent Independent System Operator, Inc. (MISO) costs; and
•a $14 million increase in depreciation and amortization primarily due to higher depreciation rates from the 2024 Indiana rate case.
Partially offset by:
•an $86 million decrease in operation, maintenance and other primarily due to a decrease in the amortization of riders and lower plant maintenance.
Other Income and Expenses, net. The decrease was primarily due to shareholder coal ash insurance proceeds in the prior year and higher non-service pension costs in the current year.
Interest Expense. The increase was primarily due to higher outstanding debt balances.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income, partially offset by an increase in the amortization of investment tax credits.
PIEDMONT
Results of Operations
| Nine Months Ended September 30, | |||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | ||||||||||||||
| Operating Revenues | $ | 1,558 | $ | 1,463 | $ | 95 | |||||||||||
| Operating Expenses | |||||||||||||||||
| Cost of natural gas | 603 | 494 | 109 | ||||||||||||||
| Operation, maintenance and other | 265 | 301 | (36) | ||||||||||||||
| Depreciation and amortization | 212 | 210 | 2 | ||||||||||||||
| Property and other taxes | 43 | 56 | (13) | ||||||||||||||
| Total operating expenses | 1,123 | 1,061 | 62 | ||||||||||||||
| Gains (Losses) on Sales of Other Assets and Other, net | 652 | - | 652 | ||||||||||||||
| Operating Income | 1,087 | 402 | 685 | ||||||||||||||
| Other Income and Expenses, net | 39 | 40 | (1) | ||||||||||||||
| Interest Expense | 133 | 143 | (10) | ||||||||||||||
| Income Before Income Taxes | 993 | 299 | 694 | ||||||||||||||
| Income Tax Expense | 249 | 56 | 193 | ||||||||||||||
| Net Income | $ | 744 | $ | 243 | $ | 501 | |||||||||||
| MD&A | PIEDMONT | ||||
The following table shows the percent changes in dekatherms delivered and average number of customers. The percentages for all throughput deliveries represent billed and unbilled sales. Amounts are not weather-normalized.
| Increase (Decrease) over prior year | 2026 | ||||
| Residential deliveries | (5.9) | % | |||
| Commercial deliveries | (3.1) | % | |||
| Industrial deliveries | (8.2) | % | |||
| Power generation deliveries | 10.3 | % | |||
| For resale | (10.6) | % | |||
| Total throughput deliveries | 4.8 | % | |||
| Secondary market volumes | (28.9) | % | |||
| Average number of customers | (12.9) | % | |||
Nine Months Ended September 30, 2026, as compared to September 30, 2025
Operating Revenues. The variance was driven primarily by:
•a $109 million increase in cost of natural gas revenues primarily due to higher commodity prices;
•a $9 million increase due to the North Carolina IMR;
•an $8 million increase due to the South Carolina Rate Stabilization Act rate adjustments; and
•a $7 million increase due to secondary marketing sales.
Partially offset by:
•a $43 million decrease due to lower revenues as a result of the sale of Piedmont's Tennessee business.
Operating Expenses. The variance was driven primarily by:
•a $109 million increase in cost of natural gas due to higher commodity prices.
Partially offset by:
•a $36 million decrease in operations, maintenance and other primarily due to lower expenses as a result of the sale of Piedmont's Tennessee business and lower shared services costs; and
•a $13 million decrease in property and other taxes primarily due to lower franchise taxes.
Gains (Losses) on Sales of Other Assets and Other, net. The increase was due to the gain on sale of Piedmont's Tennessee business.
Interest Expense. The decrease was primarily due to lower intercompany interest expense.
Income Tax Expense. The increase in tax expense was primarily due to an increase in pretax income and higher state tax expense associated with the sale of Piedmont's Tennessee business.
LIQUIDITY AND CAPITAL RESOURCES
Sources and Uses of Cash
Duke Energy relies primarily upon cash flows from operations, debt and equity issuances and its existing cash and cash equivalents to fund its liquidity and capital requirements. Duke Energy's capital requirements arise primarily from capital and investment expenditures, repaying long-term debt and paying dividends to shareholders. Duke Energy Carolinas, Duke Energy Progress and Duke Energy Florida are also monetizing tax credits in the transferability markets established by the IRA and are working with utility commissions on the appropriate regulatory process to pass the net realizable value back to customers over time. In April 2026, we executed a multiyear agreement to sell up to $3.1 billion of net tax credits with expected proceeds to be received through 2029. See Note 17 to the Condensed Consolidated Financial Statements, "Income Taxes," for further information. Duke Energy's Annual Report on Form 10-K for the year ended December 31, 2025, included a summary and detailed discussion of projected primary sources and uses of cash for 2026 to 2028.
Duke Energy has executed several equity forward sales agreements as part of the ATM program. Settlement of the forward sales agreements is expected to occur by December 31, 2027. See Note 15 to the Condensed Consolidated Financial Statements, "Stockholders' Equity" for further details.
In March 2026, Duke Energy extended the termination date of its existing $10 billion Master Credit Facility to March 2031. As of September 30, 2026, Duke Energy had $451 million of cash on hand and $8.0 billion available under its Master Credit Facility. Duke Energy expects to have sufficient liquidity in the form of cash on hand, cash from operations and available credit capacity to support its funding needs.
In July 2025, Piedmont entered into a purchase agreement with Spire Inc. to sell Piedmont's Tennessee business. On March 31, 2026, Piedmont closed on the sale and received proceeds of approximately $2.5 billion.
| MD&A | LIQUIDITY AND CAPITAL RESOURCES | ||||
In August 2025, Duke Energy, Progress Energy and Florida Progress entered into an investment agreement for Florida Progress to receive $6 billion in exchange for an eventual anticipated 19.7% indirect investment in Duke Energy Florida following a series of closings. On March 3, 2026, Duke Energy, Progress Energy and Florida Progress consummated the first closing that resulted in Florida Progress issuing 9.19% of its membership interests in exchange for approximately $2.8 billion in cash proceeds. Consistent with its option to accelerate funding, the affiliate of Brookfield Super-Core Infrastructure Partners has indicated an intent to increase its December 2026 investment in Florida Progress from $200 million to $1.2 billion and to fund the remaining $2 billion in 2027. See Note 2 to the Condensed Consolidated Financial Statements, "Dispositions," for further details.
Cash Flow Information
The following table summarizes Duke Energy's cash flows.
| Nine Months Ended | ||||||||||||||
| September 30, | ||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||
| Cash flows provided by (used in): | ||||||||||||||
| Operating activities | $ | 7,889 | $ | 8,672 | ||||||||||
| Investing activities | (10,824) | (9,976) | ||||||||||||
| Financing activities | 3,130 | 1,622 | ||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 195 | 318 | ||||||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 363 | 421 | ||||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 558 | $ | 739 | ||||||||||
OPERATING CASH FLOWS
The following table summarizes key components of Duke Energy's operating cash flows.
| Nine Months Ended | ||||||||||||||||||||
| September 30, | ||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | |||||||||||||||||
| Net income | $ | 4,372 | $ | 3,865 | $ | 507 | ||||||||||||||
| Non-cash adjustments to net income | 6,305 | 6,376 | (71) | |||||||||||||||||
| Payments for asset retirement obligations | (381) | (374) | (7) | |||||||||||||||||
| Working capital | (1,282) | (1,595) | 313 | |||||||||||||||||
| Other assets and Other liabilities | (1,125) | 400 | (1,525) | |||||||||||||||||
| Net cash provided by operating activities | $ | 7,889 | $ | 8,672 | $ | (783) | ||||||||||||||
The variance is primarily driven by:
•a $1.5 billion decrease in cash inflow due to changes in other assets and liabilities, primarily due to higher deferred fuel and purchased power costs as well as storm restoration costs due to severe winter weather.
Partially offset by:
•a $436 million increase in net income, after adjustment for non-cash items, primarily due to the recovery of infrastructure investments to reliably serve customers in our growing jurisdictions and improved weather, partially offset by interest expense and operation and maintenance expense, including storm costs.
INVESTING CASH FLOWS
The following table summarizes key components of Duke Energy's investing cash flows.
| Nine Months Ended | ||||||||||||||||||||
| September 30, | ||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | |||||||||||||||||
| Capital, investment and acquisition expenditures | $ | (12,566) | $ | (9,881) | $ | (2,685) | ||||||||||||||
|
Proceeds from the sale of Piedmont's Tennessee business
|
2,501 | - | 2,501 | |||||||||||||||||
| Proceeds from the sale of Commercial Renewables Disposal Groups, net of cash divested | - | 559 | (559) | |||||||||||||||||
| Other investing items | (759) | (654) | (105) | |||||||||||||||||
| Net cash used in investing activities | $ | (10,824) | $ | (9,976) | $ | (848) | ||||||||||||||
The variance is primarily driven by higher capital expenditures within the EU&I segment, partially offset by proceeds received from the sale of Piedmont's Tennessee business. The variance also reflects the absence of proceeds received in the prior year from the sale of the Commercial Renewables Disposal Groups.
| MD&A | LIQUIDITY AND CAPITAL RESOURCES | ||||
FINANCING CASH FLOWS
The following table summarizes key components of Duke Energy's financing cash flows.
| Nine Months Ended | ||||||||||||||||||||
| September 30, | ||||||||||||||||||||
| (in millions) | 2026 | 2025 | Variance | |||||||||||||||||
| Issuance of long-term debt, net | $ | 3,142 | $ | 4,806 | $ | (1,664) | ||||||||||||||
| Issuance of common stock | - | 16 | (16) | |||||||||||||||||
| Notes payable, commercial paper and other short-term borrowings | (381) | (824) | 443 | |||||||||||||||||
| Dividends paid | (2,555) | (2,455) | (100) | |||||||||||||||||
| Contributions from NCI | 2,839 | - | 2,839 | |||||||||||||||||
| Other financing items | 85 | 79 | 6 | |||||||||||||||||
| Net cash provided by financing activities | $ | 3,130 | $ | 1,622 | $ | 1,508 | ||||||||||||||
The variance is primarily due to:
•a $2.8 billion increase in proceeds received from the initial closing of Brookfield Super-Core Infrastructure Partners' minority interest investment in Florida Progress; and
•a $443 million increase due to lower net repayments of notes payable and commercial paper.
Partially offset by:
•a $1.7 billion decrease in proceeds from net issuances of long-term debt, primarily due to the timing of issuances and redemptions.
OTHER MATTERS
Environmental Regulations
The Duke Energy Registrants are subject to federal, state and local regulations regarding air and water quality, hazardous and solid waste disposal, coal ash and other environmental matters. These regulations can be changed from time to time and result in new obligations of the Duke Energy Registrants. Refer to Note 4, "Regulatory Matters," in Duke Energy's Annual Report on Form 10-K for the year ended December 31, 2025, for more information regarding potential plant retirements and Note 4, "Regulatory Matters," to the Condensed Consolidated Financial Statements, for further information regarding regulatory filings related to the Duke Energy Registrants.
GHG Standards and Guidelines
In April 2024, the EPA issued final rules under section 111 of the Clean Air Act (EPA Rule 111) regulating GHG emissions from existing coal-fired and new natural gas-fired power plants, referred to as electric generating units. Duke Energy is participating in legal challenges to EPA Rule 111 as a member of a coalition of similarly affected utilities and as a member of a utility trade group. The litigation is currently pending in the U.S. Court of Appeals for the District of Columbia Circuit (the Court). On April 21, 2025, the EPA filed a motion with the Court requesting a continuing abeyance while it conducted a new notice-and-comment rulemaking to reconsider the challenged EPA Rule 111. On April 25, 2025, the Court granted the EPA's motion and ordered that the litigation remain in abeyance pending further order of the Court.
On June 17, 2025, the EPA published a proposed rule to repeal EPA Rule 111 based on a finding that fossil fuel-fired power plants do not contribute significantly to dangerous air pollution under section 111 of the Clean Air Act. The EPA also published an alternative proposal that would repeal a narrower set of requirements. On September 17, 2026, the EPA published a final rule that repeals the carbon capture and sequestration-based requirements of EPA Rule 111 and retains only efficiency-based standards applicable to certain new and reconstructed stationary CT electric generating units (Partial Repeal Rule). Based on the Company's current assessment, the Partial Repeal Rule is generally consistent with the pace and scale of its existing capital plan. On September 17, 2026, the EPA also published a supplemental proposed rule that would repeal all remaining GHG emission requirements for power plants under EPA Rule 111 based on the EPA's proposed best reading of the statute that section 111 does not authorize the agency to regulate emissions from power plants in response to global climate change concerns. A coalition of environmental groups filed a petition for review with the Court on September 17, 2026, challenging the Partial Repeal Rule, and on October 16, 2026, Duke Energy, as a member of a coalition of similarly affected utilities, moved to intervene to support the EPA's defense of the rule. The Duke Energy Registrants will continue to monitor rulemaking developments and actions of the Court and will evaluate the impacts of any additional EPA actions as they become available.
Coal Combustion Residuals
In April 2024, the EPA issued the 2024 CCR Rule, which significantly expanded the scope of the 2015 CCR Rule by establishing regulatory requirements for inactive surface impoundments at retired generating facilities (Legacy CCR Surface Impoundments). The 2024 CCR Rule also imposed a subset of the 2015 CCR Rule's requirements, including groundwater monitoring, corrective action (where necessary), and in certain cases, closure, and post-closure care requirements, on certain previously unregulated coal ash accumulations at regulated facilities (CCR Management Units). Duke Energy, as part of a group of similarly affected utilities, filed a petition to challenge the 2024 CCR Rule in the U.S. Court of Appeals for the District of Columbia Circuit (the Court) on August 6, 2024. On December 15, 2025, the EPA filed a motion with the Court requesting a continuing abeyance while it reconsiders certain aspects of the 2024 CCR Rule for both Legacy CCR Surface Impoundments and CCR Management Units. On December 16, 2025, the Court granted the EPA's motion and ordered that the litigation remain in abeyance pending further order of the Court.
| MD&A | OTHER MATTERS | ||||
On April 13, 2026, the EPA published a proposed rule titled "Hazardous and Solid Waste Management System: Disposal of Coal Combustion Residuals from Electric Utilities; Legacy/CCRMU Amendments" under which the EPA proposes numerous amendments to the 2015 CCR Rule, as amended by the 2024 CCR Rule. Among other changes, the EPA is proposing to rescind all CCR Management Unit requirements finalized in the 2024 CCR Rule. In the event the EPA determines not to rescind all such requirements, the EPA is also seeking comments on several potential alternatives that would revise the existing CCR Management Unit regulations, including (i) deferring all CCR Management Unit requirements (other than the requirement to complete facility evaluations) to determinations made by a regulatory authority under a state or federal CCR permit program and (ii) expanding the CCR permit program deferral criteria for certain CCR Management Unit closures to a state or federal permit authority. With respect to Legacy CCR Surface Impoundments, the EPA is proposing (i) to establish an additional pathway for owners and operators of such units to certify closure by removal of the unit under the oversight of a regulatory authority prior to November 8, 2024, and (ii) to expand the CCR permit program deferral criteria for Legacy CCR Surface Impoundments that completed closure under state or federal regulatory authority prior to November 8, 2024, until the CCR permit authority can consider, on a site-specific basis, the need for additional closure measures, if any, to be taken. The proposed amendments, if finalized substantially as proposed, could reduce or defer certain compliance obligations associated with CCR Management Units and certain Legacy CCR Surface Impoundments. The Duke Energy Registrants will continue to monitor rule-making developments and actions of the court and will evaluate the impacts of any final rule and other EPA actions, once available. A final rule is anticipated in the fourth quarter of 2026.
In addition to the requirements of the federal CCR rules, CCR landfills and surface impoundments will continue to be regulated by the states. Cost recovery for future expenditures is anticipated and will be pursued through the normal ratemaking process with federal and state utility commissions and through wholesale contracts, which permit recovery of reasonable and prudently incurred costs associated with Duke Energy's regulated operations.
State Legislation
Indiana House Enrolled Act 1002
Indiana House Enrolled Act 1002 was signed into law on February 26, 2026. It reflects legislative priorities focused on electric utility affordability, low-income customer protections and assistance, and longer-term ratemaking concepts, including three-year rate plans and performance-based affordability and reliability metrics. Under the law, Duke Energy Indiana is required to file its first MYRP between November 15 and December 15, 2026.
Ohio Natural Gas Senate Bill 103
Ohio Senate Bill 103 (SB103) was signed into law and became effective on March 20, 2026. SB103 allows natural gas utilities to file MYRPs with forward-looking test periods.
Carolinas Resource Plan
On October 1, 2025, Duke Energy Carolinas and Duke Energy Progress filed their systemwide 2025 Carolinas Resource Plan (the 2025 Plan) with the NCUC that builds upon the approved dual-state 2023 Carolinas Resource Plan. The 2025 Plan seeks to maximize the value of existing resources, enhance grid flexibility and add new supply-side resources to reliably meet growing energy demands in the most reasonable and cost-effective manner in a period of unprecedented load growth. The evidentiary hearing took place in June 2026 and an order from the NCUC is expected to be issued by December 31, 2026. Information related to the updated systemwide plan was filed with the PSCSC on November 25, 2025, and the PSCSC issued an order accepting the resource plan on May 15, 2026.
On August 14, 2026, Duke Energy Carolinas and Duke Energy Progress filed their systemwide 2026 Carolinas Resource Plan with the PSCSC. Consistent with previous resource plans and supportive of South Carolina energy policy goals under the South Carolina Energy Security Act, the latest plan advances new generation, new energy storage and renewables opportunities, evaluates future nuclear generation options, maximizes energy efficiency and maintains flexibility to adapt as customer needs, technology and market conditions evolve. The evidentiary hearing has been scheduled for April 2027 and an order from the PSCSC is expected by June 2027.
Duke Energy Corporation published this content on November 05, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 05, 2026 at 18:32 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]