Company Trend Analysis - Duke Energy - OCT 2017

Duke Energy will benefit from increasing its exposure to the natural gas and renewable energy sectors, as these industries will see the strongest growth within the US power industry over the next 10 years. Changes to the US tax regime and a heavy debt load amid an extensive capital investment plan pose the biggest threat to the company's financial objectives.

Duke Energy is the biggest utility for market capitalisation in the US. In 2016 it has agreed to sell all its assets in Latin America (it previously had operations in Brazil, Peru, Chile, Argentina, Ecuador and Central America). The company's international business is now limited to a 25% equity interest in National Methanol Company (NMC), located in Saudi Arabia.

Its Regulated Utilities business unit serves 7.4mn retail electric customers (24mn people) in six states in the Southeast and Midwest regions of the US, namely North and South Carolina, Indiana, Ohio, Kentucky and Florida. In the power generation business, the company also has a Commercial Portfolio unit - which includes renewables and gas-fired power plants.

Long-Term Gas Consumption Growth Will Outperform Electricity
United States - Average Annual Growth In Natural Gas & Electricity, % y-o-y
e/f = BMI estimate/forecast. Source: EIA, BMI

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