Duke Energy Corp.

The stable outlook on Duke Energy and its subsidiaries reflects our expectation that the company will effectively manage its regulatory risk despite its ongoing energy transition and high capital spending, which could weaken its management of regulatory risk and its financial measures. The stable outlook also reflects our expectation that Duke Energy will maintain a consistent consolidated FFO-to-debt ratio of about 14%. We could lower our ratings on Duke Energy and its subsidiaries over the next 12-24 months if Duke Energy's consolidated financial measures weaken, including FFO to debt of consistently below 12%. This could occur if the company experiences regulatory setbacks in its key regulatory jurisdictions or if the company increases its leverage because of its high capital spending

...Proposed legislation in North Carolina House Bill (HB) 951 is pending. The proposed legislation, if passed, will mandate that Duke Energy Corp. close 5,000 megawatts (MW) of coal-fired generation, with replacement generation that allows for new renewables, opportunities for dispatchable generation, energy storage and advanced nuclear. The legislation would also potentially allow for the North Carolina Utilities Commission (NCUC) to approve Performance Based Regulation (PBR) for Duke Energy that include multi-year rate plans with a maximum three-year term, with the ability to increase rates in years two and three for projected capital, subject to a cap of 4% of first year baseline revenues. The pending legislation also incudes potential for revenue decoupling for residential class of customers, and up to $500 million of energy securitization bonds related to the retirement of the Marshall Steam Station Unit 1 and Roxboro Steam Station Units 3 and 4. We continue to monitor these developments....

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