Name: Duke Energy CEO Says 'Trade is On Everyone's Mind'
Uploaded: 2018-11-09
Duration: 5 min 1 s
Description: CEO Lynn Good says the utility's vendors are feeling the pressure of trade tariffs.

[ MUSIC ] Lyn, we're here at Fortune's Global Forum where the World economy and the US economy are important topics of discussion. As you know, there's so much anxiety about What's next for the U. S. economy? From your perspective, how do things look going into 2019? The economy is strong in the areas that we serve, Suzy. We continue to see very strong customer growth. We continue to see growth on the part of our industrial customers. So it's been a strong 18, we're hoping that momentum continues into 19. We're forecasting it for it to continue but as you know there continue to be uncertainties that a number of businesses are focused on. And one of those uncertainties is tensions between the United States and China, and You know there's, we know that Duke doesn't really do any business in China. But, how concerned are you that trade issues could be a negative for US economic growth? Trade is on everyones mind. At Duke we are supporters of a free and open market. As you said, our business is primarily here in the US. But we are impacted in our supply chain. So, vendors, things that we buy, we haven't begun to see much of an impact but we would expect that to continue over 18 into 19 Which could have some pressure on the prices on things that we buy. And the other big worry is rising interest rates and we know that big utility companies like Duke do not like high interest rates. What s you take on all of that? What's the impact for you? We're in a rising interest rate environment which of course means higher cost of money that impacts I'm you know the cost of what we building and financing and also impacts the stock price of the company like DUKE ENERGY because we are divided paying stock and typically analysing interest rate environment of stock pull back. You have some big expansion plans you are modernizing the energy grid, your investment plans for cleaner energy, that requires a lot of money And a big borrowing cost. So are those high rates making you think like some of these projects have to go on hold? We haven't made decisions to pull back specifically on interest rates, Susie. And I think the nature of our business, we are adding infrastructure year after year after year. And we've had an opportunity over the last decade to benefit from low interest rates. We also look into our productivity, how can we drive cost out of our business in other areas? So that we can continue to make smart investments. But interest rates are always on our mind, and we're focusing on how do we best manage our business in that environment. What about hiring? You can be adding to payrolls in 2019? We are always hiring so is trying to bring the right complement of skills into our business, I think about digital, Skills being important. I also think about our field crews, our line crews as we invest on our energy delivery infrastructure. Those skills are particularly important. But that workforce equation is always something that's under review as we can change our drive productivity but also make sure that we have the right skills for the business. Let's talk a little bit about technology changes cuz you're making a lot Not only at your company, but for your industry, what is the single most important tech change that you're making at Duke right now? That's an interesting question because I'm not sure I could point to one because technology is impacting us across our value chain. So we're of course introducing renewable technology. We're also introducing sensors since smart devices on our energy delivery system. We're using daily analytics. We have drones working in a variety of places. We're just working on how can we drive productivity? How can we put these tools to work to serve our customers better? And I think that's the story Susie you'd hear from any CEO. You have said that your customers have so many more demands. Of having tech upgrades, I mean what are their expectations? I think customers want more information about the way they use their energy. They want alerts on their bills. They want more pricing options. They want more energy efficiency ideas. So you think about our industry has for the most part just provided a commodity service over decades. Now we are looking to customize how can I get Better information in the hands of customers. Whether it's a mobile app, whether it's through texting or email, that gives them an opportunity to manage their life, their energy, their bill, their pricing, their need for information in a really customized way. So Duke Energy has been around in business for 140 years, how significant. Are these changes in terms of its long history? I would say it's transformative change, and as I think about just over the last decade, whether it's shell gass, or whether it's renewables, or whether it's digital and mobile technology. There has been so many dramatic changes in our industry. So that you can oly imagine What it might look like by 2025. So we're trying to make smart investments. We're focused on the customer. We're focused on our delivery systems so it can enable all these new technologies. And we're focused on clean energy. We think those are smart places to put our capital to work as this transformation continues. [ BLANK_AUDIO ]

Duke Energy CEO Says "Trade is On Everyone's Mind"

Leadership

CEO Lynn Good says the utility's vendors are feeling the pressure of trade tariffs.