Duke Energy CEO Seeks Pay-As-You-Go Construction (DUK)
Duke Energy Corp’s (DUK) new CEO, Lynn Good, says she wants to change how the company can charge customers so it can more easily pass along the cost of building expensive, big power plants as the construction moves along.
Currently, the regulations in Florida and the Carolinas, where Duke primarily does business, say that utility companies can only increase rates to customers once a project is finished. However, Good, who took over as CEO of Duke on Monday, wants to charge customers more as the construction goes, in order to minimize financing costs. Good and other proponents say that it ultimately reduces the final price tag that customers have to pay.
On the other hand, opponents of this pay-as-you-go construction plan say it shifts the risks to consumers, as the customers are paying for a project that might not produce power for years into the future, if ever.
Currently, South Carolina allows a pay-as-you-go method to charging customers for power plant constructions. Duke is now putting pressure on Florida and North Carolina regulators to ease up on their rate increase guidelines.
Duke Energy share were down 34 cents, or 0.50%, during morning trading on Friday. The stock is up 5.03% year-to-date.
The Bottom Line
Shares of Duke Energy (DUK) have a dividend yield of 4.63% based on Wednesday’s closing price of $67.39 and the company’s annualized dividend payout of $3.12 per share.
Duke Energy Corp (DUK) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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