Duke Energy Corporation
) announced that its Buck and Riverbend steam stations,
coal-fired power plants in the Charlotte area, will retire two
years earlier than scheduled. Earlier, both stations had been
slated for retirement in Apr 2015 in apprehension of upcoming
federal environmental regulations. However, the company elected
to retire Buck Units 5 and 6 and Riverbend Units 4 through 7 on
Apr 1, 2013. A total of 65 employees work at these plants.
The aforementioned units have been operating infrequently in
recent years and in the future would have operated even less with
the recent completion of new, more efficient plants and low
natural gas prices.
Of late, the company has been investing in new plants, retiring
older plants as well as working on modernization and upgrade of
plants to reduce emissions across its service area. Since 2007,
the company has invested approximately $6 billion in new plants
and has retired up to 6,800 megawatts of older coal capacity. All
the more, it has invested another $7.5 billion for plant
These developments indicate the company's commitment to meeting
electricity needs through advanced and cleaner generation while
fetching revenues at the same time. Also, the acquisition of
Progress Energy Inc. seems to be a smart move made by the
company. It has increased the company's ability to build new
power plants to meet future greenhouse-gas emissions limits.
However, valuation continues to be restrained by a number of
factors, including the present unfavorable macro backdrop,
predominantly fossil-fuel based generation assets, tepid demand
for electricity, foreign currency exchange volatility, pending
regulatory cases and the aftermath of Hurricane Sandy. New
Jersey, where Duke Energy has about 65% of its customers, was hit
hardest by Sandy. Other hard-hit states include Connecticut, West
Virginia, New York and Rhode Island. Duke Energy presently
retains a short-term Zacks Rank #3 (Hold).
Based in Charlotte, North Carolina, Duke Energy is a diversified
energy company with a portfolio of domestic and international,
natural gas and electric, regulated and unregulated businesses,
which supply, deliver, and process energy for customers in North
America and selected international markets. Duke Energy
Corporation's U.S. electricity and gas operations are spread over
the Carolinas, Florida, Indiana, Kentucky and Ohio that help in
generating a relatively stable and growing earnings stream.
Earlier, the acquisition of Progress Energy in July 2012 made
Duke Energy the largest U.S. utility in terms of market
capitalization. Prior to that, Chicago-based
) was the largest U.S. utility.
In the electric utility space
Pike Electric Corporation
) display better fundamentals and currently hold a Zacks Rank #1
AMEREN CORP (AEE): Free Stock Analysis Report
DUKE ENERGY CP (DUK): Free Stock Analysis
EXELON CORP (EXC): Free Stock Analysis Report
PIKE ELECTRIC (PIKE): Free Stock Analysis
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