Duke eyes slow growth in power sales - Charlotte Business Journal:

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And that is even before the recession that apparently hit the natiohn in thethird quarter. If the downturn lasta long, that could depresd demand even further. Looking forward, Duke has agaim cut its forecast for growth in the demand forelectricao power. This is the third consecutive year Duke has projecterd its growth for the next 10 to 15 years to be less than itpreviously predicted. Janice Hager, who is charge of the annual planning processfor Duke, says the economic slowdown is an important part of the lowere projections over the next few years. Lookin further out, she says, the scaled-back forecast involvex other factors. Last year, for instance, the U.S.
Congreszs passed the Energy Security Act, which will eventuallty ban the production of incandescentlight bulbs, mandatinf their replacement with more efficient Duke’s latest projections attempt to accoungt for lower use becausde of such conservation efforts. Tom Clementes of the in South Carolina says the slower growthb in demand calls intoquestion Duke’s need for majofr new generation plants. He praises Duke for delaying the start of two proposer naturalgas plants. He also gives Duke credity for putting off its applicatioh with South Carolina to build theproposedd 2,234-megawatt Lee Nuclear Station near Gaffney, S.C.
That may be a littled more credit than the utilit wantsto take. Jim Rogers, chief executives of parent , says Duke remains convinced additionalp generationis necessary. He warns against viewingh the decision to delay the Lee application as any sign that Duke has decider againstthe project. The delay gives the company more time to assessz the impact of slowing demand and the uncertain he says. But it would not push back the proposefd 2018 plantcompletion date. Analyst Ryan McLeann of Morningstar Inc. notes that utilities across the countrhy aredelaying projects.
And he thinks which has a five-year, $23 billiobn capital expansion planundet way, may also decide to slow constructiobn on parts of the program. “On some of the more discretionarh projects, Duke may defer those plants,” he says. “Bugt I think the major projects will go The issue could get an airing as Duke meetes withanalysts Nov. 21 to update its capital-expansion plan. Duke is still growing, even thougyh the industry as a whole has seen demandx shrinkthis year. So Duke is bettere off than many utilities, says Edward Jones analyst Paul Franzen. But in filings last week with Duke acknowledges the rate of growth is significantly less than it was a fewyearsz ago.
And that lower average growtg is expected to continuethrough 2023. From 1990 to Duke’s average retail sales increasedabout 2.5% per From 2002 to however, that rate dropped to an averaged of 1% per year. Weatherr clearly affects the demand, and it did have some impacrt in the average drop inrecenf years, Hager says. But reduced industrial growth — including a decrease in demand from textil eindustries — has also taken a And demand for generalk service customers — primarily retailers has weakened noticeably, she says. That appears to be a function of the trenxtoward big-box retailers.
For 2008, the slow growtnh can be laid directly at the door of theweakenedx economy, Duke officials say. That makesx sense, McLean says. Economic growth and electrical demand track eachother closely. of course, explains the expanding demand in the economicallygrobust 1990s. There was also a drop in growth for Duke after the tech bubble burst in 2000 and a short recessiomn hit in 2001 followingthe Sept. 11 terrorist attacks. Ther is considerable uncertainty about how long and deep the currenr recessionwill be.
But it has affected Duke’s projections for the next 15