Duke Energy’s subsidiary electric utilities generate power from solar, hydroelectric and biomass (including waste to energy) resources, but do not always retain the Renewable Energy Certificates (RECs) related to such generation. The RECs associated with such generation may be used to meet statutory or regulatory compliance obligations (on behalf of the respective electric utility and certain wholesale customers), assigned to customers pursuant to retail programs or sold/traded via bilateral commercial agreements. Duke Energy’s electric utilities also buy power through purchased power agreements (PPAs) from solar, wind, hydroelectric and biomass (including waste to energy) resources. Under certain PPAs for energy from such resources, the electric utilities purchase both the energy and the associated RECs. Under other PPAs, including some of those entered into pursuant to the electric utilities’ respective obligations under the Public Utility Regulatory Policies Act of 1978 (PURPA), Duke Energy does not purchase any RECs associated with the energy. Under PPAs entered into by Duke Energy’s electric utilities pursuant to certain retail customer programs, such utilities purchase RECs associated with the energy, but conveys the RECs to participating customers, or retires such RECs on the customers’ behalf. Duke Energy’s subsidiary Duke Energy Renewables sells the electricity and/or RECs it generates to its customers.