Duke Energy Puts Irma Repair Costs At $500M
Repair costs after Hurricane Irma cut into Duke Energy's profits in the third quarter. The cancellation of a Florida nuclear project also contributed.
CEO Lynn Good says Duke spent nearly $500 million to repair power lines and restore electricity after Hurricane Irma hit Florida and the Carolinas in September.
“This storm caused widespread, devastating damage across the Southeast region, leaving nearly a million and a half of our Florida and Carolinas customers without power,” Good told analysts on a conference call Friday.
Some of the damage costs were paid out of Duke's storm reserves. The company plans to seek rate increases to cover the rest, mainly in Florida, where Good says it could add $5 a month to the typical bill.
Duke reported a profit of $954 million in the quarter, or $1.36 a share. That was down 19 percent from a year ago, and fell 20 cents short of what Wall Street analysts were expecting.
Cancellation of the Levy nuclear project in Florida cost $84 million during the quarter. Good says customers won't be charged any more for the project.
Mild late-summer temperatures slowed down electricity use - and revenues. Duke also recorded more expenses related to last year's acquisition of Piedmont Natural Gas.
There was some good news for investors: Duke reaffirmed its prediction of 4 to 6 percent growth in profits in the coming years. Good said that's based on coming rate increases and population growth, particularly in the Carolinas and Florida.
Good also gave updates on several pipeline projects that Duke has invested in. They're designed to bring natural gas to its growing fleet of gas-fired power plants.
The Atlantic Coast Pipeline from West Virginia to Virginia and North Carolina has received federal regulatory approval, though it still needs state approvals. Good said Duke still hopes the pipeline can be operating by 2019.
The Sabal Trail pipeline from Alabama to Florida began delivering gas in July, though a court has raised new environmental concerns. Federal regulators have issued a new environmental report on the project, which continues to operate. Good said Duke expects a new court ruling in its favor.
And Duke also is a partner in the Constitution Pipeline, which is under construction in New York State. The state has denied a water permit, but the pipeline is appealing in court, and hopes the pipeline can begin service in early 2019.
Nov. 3, 2017, Duke Energy slides from earnings presentation, Duke-Energy.com
Nov. 3, 2017, Duke Energy earnings announcement and conference call