DukeEnergy.com
Duke Energy Corporation
Headquartered at Charlotte, N.C., Duke Energy is a Fortune 500 company popularly known by the symbol DUK. The mission of the company is to create sustainable value for its customers by ensuring that it produces, converts, delivers and sells superior energy and energy services. Safe environment, health and commitment to community service are regarded as cornerstones of their efforts.
History
Duke Energy turned hundred in 2004. James Buchanan Duke in 1904 originally set up the company to provide hydropower at Catawba on North Carolina. The major customers were the emerging textile industries in the region. The Company was then called the Catawba Power Station. The company gradually expanded to cater to the power needs of region. However, growing demand for power and limited water resources forced the company to shift to coal fired generation of power in the 1930’s and 40’s. The World War II triggered off an unprecedented demand for power and the electronic revolution that filled the homes with electronic and electrical gadgets increased the demand on the power sector. Duke Energy began exploring the potential of this growing market and to build up the necessary infrastructure to meet the demands of this growing power market.
During the 1950’s the company was exploring the potential of producing and distributing nuclear power. They were convinced that nuclear fuel was the cleanest, safest and most economical alternative source of power. The influx of customers into Carolinas, inflationary pressures along with oil fueled Duke Energy’s efforts in this direction. They also shifted their attention from merely producing abundance of energy to exploring ways and means of managing and conserving energy.
In 1976, Bill Lee the President of Duke Power founded the Institute of Nuclear Power Operations and post 1986, the Chairman Lee took a lead role in organizing the World Association of Nuclear Operators with the view to increase public confidence in the use of Nuclear energy as a source of power.
Meanwhile the pipelines carrying natural gas from the Gulf of Mexico to the US in the Northeast and Midwest were laid down by Panhandle Eastern. In Canada and the Westcoast the Union Gas was emerging as a big player in this field. Duke Energy too saw an opportunity in natural Gas and began making inroads into this market. The regulations for “unbundling” of Natural Gas in the United States led to competitive situations in the transportation and delivery of natural gas. Duke Energy was one of the first few companies that began its operations taking advantage of the unbundling order. Over the years it has expanded its operations to gathering, processing and marketing natural gas liquids. Natural Gas became and alternative source of producing energy and a means of catering to the growing power demands of its customers. They could now offer their customers flexible pricing options.
In 1997 Duke Power and PanEnergy (earlier Panhandle Eastern) merged to Create Duke Energy. The company then began its International Expansion and Latin America came into focus. The Company acquired Westcoast Energy and created the link between Canadian and U.S. natural gas supply and storage.
Guiding Principles of the Company
Duke Power's founders James Buchanan Duke, Dr. W. Gill Wylie and William States Lee set up Catawba Power Corporation with a focus on economic development of the region. The commitment has not changed. It has expanded the focus to include operational excellence, ethical business practices, safety, environmental stewardship and community service as the guiding principles of the company. Throughout its history the company’s focus has not shifted from these fundamental principles and the erstwhile Duke Power (Now Duke Energy) was the recipient of the Edison Award three times for efficiency and safety of its operations. Duke Power was one of the first companies to launch an environmental and water quality program in 1923. Even today, it is unwavering in its commitment to health and environmental safety and operational efficiency in its hydroelectric, nuclear, coal or gas fired power generation activities. The pipelines gathering gas are also designed, planned, built and operated keeping these fundamental guiding principles in mind. The commitment of the company to safe delivery of energy generated from Natural Gas was recognized by the American Gas Association Safety Achievement Award.
Duke Energy works in close association with local bodies to preserve natural and cultural resources and has a tradition of community service and support. It also contributes voluntarily to education, leadership development in the community. The company sees an increasing role for itself in affirming the public’s trust in the energy industry and to contributing effectively and efficiently to the overall economic development of the nation and the communities that it seeks to serve.
Position in the Industry
Duke Energy is a diversified energy company that has harnessed a number of energy sources to service the power demands of its customers. It deals with natural gas, hydroelectric power, nuclear power or coal fired power. It has its presence in the regulated and non regulated business of the industry and has an affiliated real estate company. It processes and delivers energy for its customers in North America and in selected international markets.
Franchised Electric and Gas Services with additional telecommunication services are provided by the company in North Carolina, South Carolina, Kentucky and Ohio. In the Midwest it provides around 8,100 megawatts of commercial power from unregulated power sources and natural gas and coal fired plants. The company operates in Central and South American countries such as Argentina, Bolivia, Brazil, Ecuador, El Salvador, Guatemala, Mexico and Peru. Duke Energy Generation Services(DEGS) caters to the power generation needs of large energy consumers like municipalities, utilities, industrial facilities and generates more than 6,500 megawatts of power for this purpose. Duke Energy along with Morgan Stanley Real Estate Fund has set up Crescent Resources LLC to manage and develop real estates across ten states in the southeastern and south western parts of the United States.
Financial Health
The financial health of the company is governed by a robust and dynamic Audit Charter which has resulted in creation of audit mechanisms for independent audit, internal audit and regular financial reporting. A Finance and Risk Management Committee has been constituted to monitor and advice the Board of Directors regarding “the dividend, financing and fiscal policies; review the financial exposure of Duke Energy together with mitigating strategies; review Duke Energy's risk exposure as related to the overall company portfolio and impact on earnings; determine whether actions taken by management with respect to financial matters are consistent with internal controls; review the financial impacts of major transactions as related to mergers, acquisitions, reorganizations and divestitures; provide overview for information technology security and risk; and review systems, processes, organizational structure and people responsible for the finance and risk functions”. A Nuclear Oversight Committee has been constituted to provide the “Board of Directors ("Board")-level oversight of the nuclear safety, operational and financial performance as well as long-term plans and strategies of Duke Energy Corporation's (the "Corporation") nuclear power program and make appropriate reports to the Board.”
During the long checkered history of Duke Energy consisting of mergers, acquisitions and disinvestments, the company has consistently aimed to reduce the volatility of earnings and business risk by selling commercial marketing and trading operations and investing in the lower risk energy infrastructure business. The Company’s merger with Cinergy in April 2006 gave it the required focus in electric business and the scale that it needed to stand alone. The separation of the Natural Gas business and the electric business into two companies (Spectra Energy and Duke Energy) with specific focus will help each company focus on its niche area. Today Duke Energy is ranked among the top five energy companies of the United States in market capitalization.
Duke Energy’s ongoing diluted earnings per share of $1.81 exceeded the 2005 figure of $1.73 per share. The total shareholder return for 2006 before Spectra Energy was spun off in early 2007 was 26.3%. The quarterly results of 2007 first quarter are very encouraging. The ongoing diluted earning per share was 30 cents as against the 21 cents of the previous year. The company attributes this result to the addition of Cinergy assets and improved results from International Energy. The diluted earnings per share was 28 cents as against the 37 cents of the previous year and this is consequent upon the discontinuance of the Spectra Energy operations by Duke Energy. The company is confident that it is on track for annual employee incentive target of $1.15 per share on an ongoing diluted basis.
The Company’s Directors point out that the financial results of the first quarter of 2007 indicate that the company is set to steadily improve sales growth, earn solid returns on capital investments and achieving additional cost reductions from mergers and continuous improvement efforts.
More information can be had about the company from its website Duke-Energy.com.
Languages
English
Address
- 401 S. College St
- Charlotte NC 28202 US
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