OneDrive does not duplicate files on its own. The task to duplicate files must have been given by a user; and there are a few reasons as to why OneDrive will prompt you with the option to duplicate or delete files.

• Syncing issues: It is possible that OneDrive is having problem to sync, thus causing it to create duplicate files. Always that your OneDrive is synced and not paused before making  any changes to files.
• Conflicting Files: In an environment where multiples devices are connected to the same SharePoint account, conflicts may occur. For example, if a file is being edited by a particualr user and another user went on opening the files, it can create OneDrive duplicate to preserve both versions of the files.