Duke Energy Corporation Business Issues - Case Study Example

Duke Energy Corporation Overview of Duke Energy Corporation Duke Energy Corporation (Duke Energy) is essentially the largest United States electric power holding company. Duke Energy which was first was first incorporated in May 2005 has its headquarters in Charlotte, North Carolina in addition to also having a large number of assets across other regions such as Latin America and Canada. Duke Corporation was first started in 1900 by Dr. Walker Wylie and his brother as the Catawba Power Company. The two brothers were instrumental in the financing of the building of a hydroelectric power station that was to be situated along the Catawba River at Indian Hook in South Carolina. Wylie who was keen on extending his investment to include the general construction of some additional hydroelectric power plants approached and convinced James Buchanan Duke to buy a stake in the newly founded Southern Power Company that had been founded in 1905. Duke formed the Wateree Power in 1917 that helped serve as a holding company for a number of different utilities that were owned or had been founded by Duke, his associates and his family. The name of this company was eventually changed to Duke Power in 1924 and later on in the year 1927, most of the subsidiaries that were previously under the holding company were eventually merged into Duke Power (Scoggins and York County Regional Chamber of Commerce 78). The Growth of Duke Energy Currently, Duke Energy is seen to be operating in various regions across the United States principally through a number of some of its indirect and direct wholly owned subsidiaries. These are seen to include, Duke Energy Carolinas, Duke Energy Indiana, Inc., Florida Power corporation d/b/a Progress Energy Florida, Inc., Duke Energy Ohio, Inc. (Duke Energy Ohio). The company is also seen to have operations in Latin America via its Duke Energy International, LLC (DEI). Over the years, the company’s segments have grown to include Commercial Power and international Energy and Franchised Electric and Gas (USFE&G). Duke energy has been able to make a number of recent acquisitions such as the July 2012 merger with the Progressive Energy Inc. and as well as its acquisition of the Chilean Campanario Power plant. One of the company’s subsidiaries was able to acquire Iberoamericana de Energia Ibener S.A. (Ibener) which was essentially operating as a subsidiary of the CGE Group. A more recent acquisition of Duke Energy is its June 2013 undisclosed minority stake acquisition of Clean Power Finance Inc. Duke Energy is seen to have a relatively large number of various investments that are generally seen to be categorized as other investments. These investments include; its wholly owned, Captive Insurance subsidiary, its Bison insurance Company Limited (Bison), a 50% Interest in DukeNet Communications, contributions to the Duke Energy Foundation, a 60% interest in the Duke Energy Trading and marketing, LLC (DukeNet) and a variety of other related telecommunications businesses (Reuters. Nd). Duke Energy’s U.S Franchised Electric and Gas Segment (U.S.FE&G) This segment of Duke Energy is found to be responsible for the generation, distribution, transmission and eventual sale of electricity in the regions covering northern South Carolina, North Carolina, west central Florida, northern Kentucky and southern, central and north Indiana. USFE&G is also seen to be involved in the transportation and sale of natural gas in the areas around northern Kentucky and southwestern Ohio. In order to effectively conduct its operations USFE&G is seen to primarily operate through Progress Energy Carolinas, Duke Energy Ohio, duke Energy Carolinas, Progress Energy Florida and Duke Energy Indiana. Of note however is that Duke Energy Indiana and Duke Energy Ohio that engage in distribution and transmission operations are collectively referred to as Duke Energy Midwest. The service area covered by USFE&G is found to cover an approximated area of about 10, 000 square miles. USFE&G is seen to be responsible for the provision of natural gas distribution and transmission services to an estimated over 500,000 customers across northern Kentucky and southwestern Ohio. The company is seen to sell electrical power on a wholesale basis to a number of electric cooperative utilities, incorporated municipalities as well as other load serving entities across this region (Reuters. Nd). Duke Energy’s Commercial Power Segment This segment of Duke Energy is generally seen to own, manage and operate a large number of power plants in addition to its engaging procurement of electric power, its marketing as well as its being responsible for the emission and fuel allowances seen to be relating to these power plants. Commercial Power is also seen to be responsible for a number of contractual positions. Excluding its renewable energy generation assets, the power generation operations engaged in by Commercial Power are seen to primarily consist of gas-fired and coal-fired non-regulated generation assets that are essentially dispatched into a number of various wholesale markets. Using these assets, This group of Commercial Power assets that are ideally located in the Midwestern United States are seen to primarily consist of an estimated 6,825 net megawatts of electric power generation. Duke Energy is seen to serve a large number of gas customers and retail electricity across west central, northern and southern Ohio with both energy and other energy services. Commercial power has also been able to positively engaged in the construction, development and operation of a number of renewable energy projects via Duke Energy Generation Service, Inc. (DEGS). DEGS was seen to have an approximated 1,269 net megawatt of total potential renewable energy generation capability as at December 31, 2012 (Reuters. Nd). Duke Energy’s International Energy Segment The International Energy segment of Duke Energy is seen to be principally engaged in the operation and management of a number of power generation facilities in addition to the general sale and marketing operations of natural gas, natural gas liquids as well as electric power in regions found to be outside the United States. This segment is seen to conduct its various operations through Duke Energy International and a number of its affiliates. The principal market targeted by International Energy is found to be the Latin America market. International Energy is also seen to own a 25% interest in the National Methanol Company (NMC). This company that is located in Saudi Arabia is fundamentally a regional producer of methyl tertiary butyl ether (MTBE) and methanol. International Energy is also seen to have substantial interests, operate or own an approximated 4,900 gross megawatts in a number of electricity generation facilities (Rauf 99). Duke Energy Mission Statement and Company Values According to Duke Energy’s mission statement, the electricity company aims to try and essentially attempt to make the lives of people better by ensuring that it constantly strives to ensure that it provides electricity and gas services to them in a manner that can be perceived as essentially being clean, reliable and affordable. In this regard, the company has to always ensure that it is on the constant look out for ways in which it can generally be able to grow, improve as well as significantly be able to reduce its impact on the environment. Duke Energy Corporation is also seen to aim at creating superior value for its various investors, the communities that it serves, its customers as well as all its employees by ensuring that it is constantly producing, delivering and converting energy and electrical services for use. Duke Energy strives to ensure that it is able to always provide energy that is found to constantly be reliable, clean and affordable to all its various customers all through 24 hours each day, and during all seven days each week. In line with its established mission statement, Duke Energy is seen to constantly be trying to implement and observe a number of key values that if well adhered to, will essentially serve to help the company realize its goals as outlined in its mission statement (Duke Energy 2013). Duke Energy Company Values Duke Energy can generally be perceived as constantly trying to observe a number of key values in its operations. These values are seen to include; Safety: Duke Energy has developed a policy of always ensuring that it tries to put safety first in all that it endeavors to do, in line with this policy, the company has been able to successfully establish an effective environmental, health and safety (EHS) management system. This is seen to help in providing it with a common framework that enables the company to be able to connect its business planning, the implementation of these plans and the subsequent measurement of the success of these plans as well as any performance improvement initiatives. The laid out EHS standards are found to generally be greatly varied as implemented by the company’s different businesses, mainly dependent on the procedures and methods that are found to best apply to a given community with the company. Integrity: The company also attempts to adopt the highest possible degree of integrity in not only honoring its various commitments but also in its admitting of wrong doing in the event that it happens to be wrong. Respect: Duke Energy is keen on valuing all the diverse experiences, perspective and talents shown by all the different individuals and entities it comes across. It constantly treats others in the same manner in which it would itself want to be treated. Caring: The company also looks for each other in addition to making both the communities and environment around the company a much better place for one to live. Passion: Duke Energy is also seen to be particularly passionate in respect to its business and is always striving to attain better standards of excellence. This value has helped the company develop a culture that sees it take accountability for all its actions. Openness: In its efforts geared at causing the company to increasingly become better, Duke Energy is essentially open to an new ideals that might happen to be generated by its stakeholders, customers and co-workers (Duke Energy 2013). E-commerce Website Analysis The Duke Energy company title is found to be evidently quite appropriate as its Home Page title of HOME – Duke Energy is quite short and as a result of its consisting of about 18 characters is seen to be easily searched by most search engines as most search engines normally stop any attempts to look at a page title after going through about 60 characters, as compared to Duke Energy, its competitor the American Energy and Power’s website has a rather vague title in the form of AEP.com which might possible have a number of different interpretations (AEP 2013). The Centre Point Energy is also clear and quite comprehensive (CenterPointenergy 2013). All the website loads at a relatively fast rate in addition to not requiring any special software downloads before once can be able to access them. Although the information presented on Duke Energy Website is found to be more as compared to that which is availed by the company’s competitors on their webpages, the information presented by all these companies is essentially clearly legible with the ease of navigation being ensured by the provision of a number of quick links being provided on their homepages to facilitate easy access across the entire website. Users have also been thoughtfully provided with a link that enables them to easily contact the different companies. However, it is easy to easy to find required information across the entire website. The website is compatible with a large number of different browsers, a factor that causes it be become quite easily accessible by all individuals irrespective of the web browser in use. The Duke Energy website provides users with the option of setting up an account with which they can be able to easily access their bills and manage their payments. Similarly the American Electric Power and the CenterPoint Energy websites also provide the same services to their customers. However, of the three, the Duke Energy company website is seen to best advertise a number of products and services some of which can be able to easily purchase from the company website (Duke Energy 2013). The CentrePoint Energy Website has been creatively subdivided into a number of easy to access sections to cater and provide specialized information for the various categories of energy consumers namely the Business, the Residential and the builders and Trade allies’ categories (CenterPointenergy 2013). The Duke Energy and American Energy Websites are however not seen to provide this easy categorization (AEP 2013; Duke Energy 2013). In general the Duke Energy website is seen to be far more user friendly and comprehensive as compared to the websites of its two other rivals with the American Electric Power being seen to be having the poorest design and user friendliness (AEP 2013). Works cited AEP. American Electric Power. 2013 Web. 4th Sept. 2013. http://www.aep.com/ CenterPointenergy. CentrePoint Energy. 2013. Web. 4th Sept. 2013. Duke Energy. Duke Energy-Home. Duke Energy.com nd. Web. 4th Sept. 2013. Rauf, Bobby. Finance and accounting for energy engineers. Lilburn, GA : Fairmont Press; Boca Raton, FL : Distributed by Taylor & Francis, 2011. Print. Reuters. Duke Energy Corp (DUK). reuters.com. nd. Web. 4th Sept. 2013. Scoggins, Michael and York County Regional Chamber of Commerce (S.C.). Historic York County : an illustrated history. San Antonio, Tex. : Historical Pub. Network, 2009. Print. Read More