Duke Energy (DUK) Risk Factor Changes

Each of the Duke Energy Registrants’ senior long-term debt issuances is currently rated investment grade by various rating agencies.

While we strive to maintain constructive communications with our shareholders, activist shareholders may, from time to time, engage in proxy solicitations or advance shareholder proposals, or otherwise attempt to affe…

Cybersecurity risks have increased in recent years as a result of the proliferation of new technologies, and the increased sophistication, magnitude and frequency of cyberattacks and data security breaches.

Federal and state laws, regulations and other legal requirements, including those related to the 2015 CCR Rule and 2024 CCR Rule, may require or result in additional expenditures, including increased operating and mai…

Natural disasters or operational accidents within the Company or industry (such as wild fires, earthquakes, hurricanes or natural gas transmission pipeline explosions) could have direct or indirect impacts to the Duke…

Factors that could impact sales volumes, generation of electricity and market prices at which the Duke Energy Registrants are able to sell electricity and natural gas include the following:

A continuation of adverse economic conditions including economic downturn or high commodity prices could also negatively impact the financial stability of certain of our customers and result in their inability to pay…

These laws and regulations generally require the Duke Energy Registrants to obtain and comply with a wide variety of environmental licenses, permits, inspections and other approvals.

Increased competition and unrecovered costs could adversely affect the Duke Energy Registrants’ results of operations, financial position or cash flows and their utility businesses.

As a consequence, Duke Energy may not be able to fully implement or realize the anticipated results of its energy modernization, which may have an adverse effect on its financial condition.

Meeting the evolving and growing energy needs of our customers will require continued operation of our existing carbon-free technologies including nuclear and renewables.

Duke Energy’s results of operations depend, in significant part, on the extent to which it can implement its business strategy and goals successfully.

Duke Energy’s future results could be adversely affected if it is unable to implement its business strategy to provide reliable energy while maintaining low costs and balancing energy modernization objectives and carb…

If the rating agencies were to rate the Duke Energy Registrants below investment grade, borrowing costs would increase, perhaps significantly.

Each of the Duke Energy Registrants’ senior long-term debt issuances is currently rated investment grade by various rating agencies.

In addition, actions such as those described above could cause fluctuations in the trading price of our common stock, based on temporary or speculative market perceptions or other factors that do not necessarily refle…

Duke Energy’s long-term strategy requires the construction of new projects, either wholly owned or partially owned, which involve a number of risks, including construction delays, delays in or failure to receive requi…

The Duke Energy Registrants may not recover costs incurred to begin construction on projects that are canceled.

In addition, certain regulatory and legislative bodies have passed legislation implementing the extension of certain tax credits to be used toward the costs of residential solar installation or have introduced or are…

The 2015 CCR Rule classifies CCR as nonhazardous waste and allows for beneficial use of CCR with some restrictions.

•capacity and transmission service into, or out of, the Duke Energy Registrants’ markets.

•ability to procure satisfactory levels of inventory, including materials, supplies, and fuel such as coal, natural gas and uranium; and

•natural gas, crude oil and refined products production levels and prices;

•availability of competitively priced alternative energy sources, which are preferred by some customers over electricity produced from coal, nuclear or natural gas plants, and customer usage of energy-efficient equipm…

•transmission or transportation constraints or inefficiencies;

•supply of and demand for energy commodities, including potential usage of electricity by data centers;

•weather conditions, including extreme winter or summer weather that could cause significantly lower or higher demand for energy or natural gas usage for heating or cooling purposes, as applicable, storm-related custo…

The EPA has issued or proposed federal regulations, including the new rules issued in April 2024, governing the management of wastewater, CCR management units and CO2 emissions.

environmental laws or regulations to more stringent compliance levels could, and are likely to, result in additional costs of operation for existing facilities or development of new facilities being prevented, delayed…

carbon capture technologies that are not yet adequately demonstrated at utility scale.

and negatively impact customer reliability and affordability due to such rules' imposition of stringent GHG emissions limitations and reliance on

successful, and adherence to these rules may increase the cost of compliance, impact generation resource mix and carbon-reduction targets,

impoundments at retired generating facilities (Legacy CCR Surface Impoundments).

corrective action requirements on previously unregulated coal ash sources at regulated facilities (CCR Management Units) and inactive surface

and more stringent air toxic limits on existing coal plants, increase limitations on wastewater discharge, and impose groundwater monitoring and

rules issued in April 2024, among other things, impose stringent GHG emissions limitations on existing coal plants and new natural gas plants

The Duke Energy Registrants are subject to numerous environmental laws and regulations affecting many aspects of their present and future operations, including CCRs, air emissions, water quality, wastewater discharges…

Additionally, even if completed, strategic transactions may not deliver the anticipated strategic, operational or financial results.

•Costs incurred in connection with these transactions, including advisory fees and management diversion, for which we may receive little or no benefit.

•Opportunity costs, lost strategic optionality, and foregone operational or financial benefits; and

•Negative reactions from financial markets and stakeholders, including reputational effects;

•Adverse impacts to our credit metrics and potential pressure on our credit ratings;

•Inability to achieve anticipated proceeds could require Duke Energy to seek alternative funding sources to execute its capital plan and impede our ability to displace previously planned issuances of long-term debt an…

There can be no assurance that strategic transactions, including merger and acquisition activities and the disposition of assets or businesses, will be completed as expected or at all.

Failure to complete strategic transactions could adversely affect the Duke Energy Registrants’ financial condition, credit profile and ability to execute their business strategy.

Duke Energy’s long-term strategy requires extensive capital investment in generation and transmission facilities.

The Duke Energy Registrants have incurred, and may incur additional costs or delays in the construction of new plants or facilities and may not be able to recover their investments in whole or in part.

Duke Energy’s operations and capital projects are exposed to supply chain disruptions, inflation, tariffs and export restrictions.

Risks Related to Supply Chain Disruptions, Inflation, Tariffs and Foreign Export Restrictions

Federal legislation enacted in 2025 eliminated the long‑term extension of certain residential solar tax credits, causing these incentives to expire after 2025, however, some states continue to offer or consider solar…

The generation of electricity and the transportation and storage of natural gas involve inherent operating risks that may result in accidents involving serious injury or loss of life, environmental damage or property…

At times, demand can exceed available generation capacity and emerging large loads – such as hyperscale data centers and industrial facilities – present unique risks due to their high demand, rapid fluctuations, and u…

•fuel procurement challenges for coal, natural gas, crude oil and uranium and capacity limitations for transmission services.

•customer-owned generation, energy efficiency adoption and technological advances reducing demand; and

•transmission or transportation constraints, purchased power availability and competitive alternative energy sources;

•weather variability such as extreme seasonal conditions, storm-related outages, or drought impacting generation economics;

The Duke Energy Registrants are exposed to financial and operational risks associated with growth including volatility in sales, supply and demand forecasts, and customer usage changes which could negatively impact th…

The Duke Energy Registrants are subject to numerous environmental laws and regulations affecting many aspects of their present and future operations, including CCR, air emissions, water quality, wastewater discharges,…

The Duke Energy Registrants may also face heightened competitive pressures arising from other utilities and energy suppliers that construct or install generation facilities directly for customers, as well as from cust…