Must-know: Duke Energy’s generation and fuel mix



Duke’s generation facilities

Duke Energy’s (DUK) electricity generation portfolio is regionally diversified. The fuel type that’s used to produce electricity is also diversified. Duke has a generation capacity of 57,500 megawatts (or MW) in the U.S.

Even after it sells its unregulated power generation business to Dynegy Inc. (DYN), Duke will still be the largest utility in the U.S.—in terms of generating capacity. The deal is expected to close by the first half of 2015. It will take 6,100 MW of Duke’s capacity. NRG Energy (NRG) and NextEra Energy (NEE) follow Duke as the second and third largest power companies in U.S.—in terms of capacity.

Fuel Mix

Fuel mix

Coal is Duke’s top fuel source contributor. It’s used to generate electricity. Coal-based power plants make up 40% of Duke’s generating portfolio. The company has a balanced fuel mix. It has other sources that generate electricity including natural gas, nuclear, oil, hydro, wind, and solar.

Duke is focused on conventional power generation. It has a limited commitment towards renewable energy. In regards to renewable energy, it has an exposure of only 1,308 MW of installed wind and solar capacities. In its international operations, 66% of its owned capacity is hydro-based power plants.

Regional diversity

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In the six states that Duke operates in, it has a generating capacity that’s proportional to its customer base. Duke has close to 13,000 MW of installed capacity in the Carolinas. In Ohio and Florida, Duke owns a generating capacity of ~10,000 MW and 9,000 MW, respectively. The rest of the operating states for Duke have less capacity.

Internationally, Duke has capacities spread across many countries in Latin America. It has a total capacity of 4,710 MW installed in Peru, Ecuador, Brazil, El Salvador, Chile, and Argentina.

The combination of a balanced fuel mix and the presence of power plants in many regions helps shield Duke from regional risks. This is one of the reasons Duke is a top holding for the Utilities Select Sector SPDR (XLU).

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