Duke Energy 4Q13 Earnings Call Notes

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A digest of some of the top insights that I’ve gathered from this week’s earnings calls.  Full notes can be found here.

$9 Billion investment in 2013

“during 2013 we completed our $9 billion fleet modernization program. This program added approximately 5600 megawatts of new combined-cycle natural gas and state of the art coal capacity in the Carolinas and Indiana replacing a similar amount of capacity for older plants we have or are retiring by 2015.”

Exiting Mid-west generation business

“we are beginning a process to exit our Midwest generation business. After an 18-month regulatory process, we were disappointed the Ohio Commission denied our application for our cost-based capacity charge late last week. I want to thank the entire Ohio regulatory team that worked so diligently on its filing. However, this decision gives us clarity. The volatility inherent in emerging generation portfolio has challenged our ability to earn the level of consistent and fair return to our investors. This business is not a strategic fit for Duke Energy.”

Opportunities in renewables, greater mix of solar

“We see opportunities to continue to grow our renewables platform over the two years and expect a greater mix of solar in our capital deployment. We are targeting 400 million of renewables capital annually and we have the potential to deploy more if opportunities arise.”

Capex grows beyond 2016

“I think our CapEx profile does grow beyond 2016. I think back in our appendices we show that our rate base growth moves in the range of 6% beyond 2016 as we ramp up the lead combined cycle plants essential for the Florida combined cycle. And also we will see a change in 2016 and beyond as we become a significant taxpayer in a decrease and deferred taxes now put on to push on our rate base as well, Shar. So I think we do have growth in the earnings base.”