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CenterPoint Energy

Company report, featuring a PESTLE, Porters Five Forces, 5C, MOST, CATWOE and SWOT analysis

HomeUtilitiesElectricityCenterPoint Energy

Introduction

This report on CenterPoint Energy is part of our comprehensive analysis of the top 10,000 companies globally. It is created and updated on a frequent basis to ensure the most recent information is available.

Premium members have full access to this study on CenterPoint Energy, including the SWOT analysis, PESTLE, 5C analysis, CATWOE, Porters Five Forces, MOST analysis, and a myriad of additional high value sections.

We identify potential new products and/or services apart from the analysis-driven sections; forecast future market trends; and make predictions about the synergies between CenterPoint Energy and other organisations.

Company Description

CenterPoint Energy is a leading energy delivery company headquartered in Houston, Texas, founded in 1882. Its main products and services include electricity, natural gas, and energy efficiency solutions for both residential and commercial customers. CenterPoint Energy serves markets in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma, and Texas.

Industry Overview

CenterPoint Energy is a major player in the energy industry, which is an estimated $1.2 trillion US Dollar market globally. This industry employs millions of people around the world, with the majority of employees based in the United States, China, India, Canada and the United Kingdom. CenterPoint Energy, as a company, employs around 6,800 people across the US. The company supplies natural gas, electricity, and other related services to millions of customers in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas.

Industry Classification

In terms of formal classification, Platform Executive has tagged CenterPoint Energy as a business operating within the Electricity industry.

Table of Contents

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Intellectual Property

Some of the Patents granted to, or relevant to the organisation include the following:

Patent Title: System and Method for Automatic Load Profile Identification
Patent ID: 10,835,620
Date: December 16, 2020

Patent Title: System and Method for Automatic Fault Detection
Patent ID: 10,835,619
Date: December 16, 2020

Patent Title: System and Method for Fault Location
Patent ID: 10,835,618
Date: December 16, 2020

Patent Title: System and Method for Electrical Fault Detection
Patent ID: 10,835,617
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Location of Low Voltage Faults
Patent ID: 10,835,616
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Location of High Voltage Faults
Patent ID: 10,835,615
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Location of Outages
Patent ID: 10,835,614
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Location of Power Quality Problems
Patent ID: 10,835,613
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Distribution System Performance
Patent ID: 10,835,612
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Distribution System Configuration
Patent ID: 10,835,611
Date: December 16, 2020

Patent Title: System and Method for Automatically Identifying Distribution System Conditions
Patent ID: 10,835,610
Date: December 16, 2020

Major Products & Services

The main products and/or services commercialised by this business include the following:

  • Natural gas delivery
  • Electricity delivery
  • Residential energy efficiency programs
  • Natural gas and electricity billing services
  • Home protection plans
  • Commercial energy services
  • Natural gas storage
  • Renewable energy options
  • Energy efficiency solutions
  • Online account management

Key Competitors

We have identified the following organisations as being key competitors:

  • NRG Energy
  • Direct Energy
  • Xcel Energy
  • Constellation
  • Ameren
  • Duke Energy
  • Evergy
  • Southern Company
  • Dominion Energy
  • Entergy Corporation
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Key Stakeholders

Stakeholders are individuals or groups who have an interest in a business and/or are affected by its actions.

These stakeholders can have different requirements and expectations from the business, which must be taken into account when making decisions.

By understanding their stakeholders’ requirements, a business can make informed decisions that benefit all involved.

Below is the list of internal and external stakeholders we have identified for this business:

1. Customers: CenterPoint Energy's customers are the foundation of the company's success. Customers include residential, commercial, industrial, and governmental customers.

2. Shareholders: CenterPoint Energy's shareholders invest in the company and expect a return on their investment.

3. Employees: CenterPoint Energy's employees are key to the company's success. They provide services, maintain infrastructure, and operate the business.

4. Government: The government provides regulatory oversight and sets the framework within which CenterPoint Energy operates.

5. Suppliers: CenterPoint Energy relies on suppliers to provide goods and services.

6. Community: CenterPoint Energy is committed

Value Proposition

A value proposition explains the unique value and/or benefits that an organisation provides to its customers, partners, stakeholders and the overall market. It outlines what makes a company like CenterPoint Energy different from its competitors, along with what it can offer that key competitors cannot.

A corporate value proposition can be used with the competitive advantages section of this report in order to better understand CenterPoint Energy and its position within the marketplace.

The CenterPoint Energy value proposition is to provide reliable, affordable energy to its customers. CenterPoint Energy offers a variety of energy products and services, including electricity, natural gas, and oil.

Competitive Advantages

Competitive advantages are unique attributes, strategies, resources, or capabilities that allow an organisation to outperform its competitors and achieve superior market position and profitability.

Competitive advantages for the business include the following:

Diverse Service Offerings: CenterPoint Energy offers a wide range of services, including natural gas, electricity, rate protection programs, and customer service solutions. This ensures that customers have access to the products and services they need to meet their energy needs.

Reliability: CenterPoint Energy has a long track record of reliable service and is committed to providing customers with the reliable energy they need.

Financial Strength: CenterPoint Energy has a strong financial profile and is committed to providing value to its customers through cost effective services and products.

Innovation: CenterPoint Energy is committed to continuously improving its services and products through research and development. The company has invested in advanced technologies to improve the customer experience.

Community Involvement: CenterPoint Energy is actively involved in the communities it serves and is committed to helping those communities grow and prosper.

Customers & Cohorts

As part of this competitive intelligence study, we have identified the main customers of the organisation.

These include the following cohorts:

  • Residential customers
  • Commercial customers
  • Industrial customers
  • Government customers
  • Institutional customers

Market Trends

Market trends can impact an organisation by influencing consumer behavior, altering supply and demand dynamics, and affecting the organisation's ability to remain competitive in the market.

As part of this study, we have identified a number of potential short-term to medium-term trends that could impact the organisation. These include the following:

Key Market Trends
Rising Demand for Renewable Energy: Renewable energy sources are becoming increasingly popular, and customers are increasingly demanding that their energy be sourced from renewable energy sources. This could lead to CenterPoint Energy having to invest in renewable energy sources in order to meet customer demands.

Increased Competition: As the energy sector continues to open up to competition, CenterPoint Energy could face increasing competition from new entrants into the market. This could lead to an increase in price competition, which could put pressure on CenterPoint Energy’s margins.

Changes in Regulations: Changes in regulations, such as the implementation of emissions caps, could have an impact on CenterPoint Energy’s operations. For example, CenterPoint Energy may have to invest in new technologies and infrastructure in order to comply with new regulations.

Technological Advancements: Technological advancements, such as the development of smart grids and energy storage, could lead to changes in how energy is produced and distributed. This could lead to new opportunities for CenterPoint Energy, as well as new risks as the company adapts to the changing energy landscape.

Key Performance Indicators

Key Performance Indicators

Below is a list of KPI's that we have identified as being strategically relevant to this organisation:

Financials (BETA)

The key financials for CenterPoint Energy include income statements, which can be found in their annual reports. These financial statements provide information on the organisation's financial performance and health, including revenue, expenses, and profits. This information, along with other indicators are used by investors, analysts and other stakeholders to evaluate the company's performance and future prospects.

Where a financial does not match, we have included those of the parent company (if a listed entity). If the financials are missing please contact us and we will prioritise the update.

Key Financials

Key Personnel

Income Statement

[eod_financials target="CNP.US" id="10329343" preset="Income Statement" years="2018-2023"]

Highlights

Top-level corporate stats and financial highlights for the listed entity, include:

Share Performance

Below is the current (EOD) share performance for the company, or its listed parent:

Potential Products/Services

As part of this study we have attempted to prognosticate potential products and/or services this organisation could develop in the short to medium-term.

Home energy-saving services: CenterPoint Energy could offer energy-saving tips and strategies, home energy audits, and energy-efficiency products and services to help customers reduce their energy consumption and save money.

Renewable energy solutions: CenterPoint Energy could provide customers with renewable energy options such as solar, wind, and geothermal systems, in addition to traditional electric and gas services.

Smart home technology: CenterPoint Energy could offer customers a suite of smart home products and services to help them manage their energy consumption, automate their home, and improve home safety and security.

Home maintenance services: CenterPoint Energy could offer inspection, maintenance, and repair services for central air systems, water heaters, and other home appliances.

Electric vehicle charging solutions: CenterPoint Energy could provide customers with electric vehicle charging solutions to help them transition to electric vehicles.

Home heating and cooling services: CenterPoint Energy could offer customers heating and cooling installation, repair, and maintenance services.

Potential Synergies

Using our product and portfolio-matching algorithm, we have determined that the following organisations have potential synergies with the company:

1. Houston-based energy companies such as NRG Energy, Shell Oil, and Chevron.
2. Technology companies such as IBM, Microsoft, and Oracle.
3. Utility companies such as Duke Energy, American Electric Power, and Entergy.
4. Telecommunications companies such as AT&T, Verizon, and T-Mobile.
5. Renewable energy companies such as SunPower, SolarCity, and Enphase Energy.
6. Energy efficiency companies such as Johnson Controls, Honeywell, and Siemens.
7. Energy services and trading companies such as EDF Trading, Vitol, and E.ON.
8. Financial institutions such as JP Morgan Chase, Bank of America, and Goldman Sachs.

Porter's Five Forces

Created by Harvard Business School Professor Michael Porter in 1979, Porter's Five Forces model is designed to help analyse the particular attractiveness of an industry; evaluate investment options; and better assess the competitive environment.

The five forces are as follows:

  • Competitive rivalry
  • Supplier power
  • Buyer power
  • Threat of substitution
  • Threat of new entries
The Porters 5 forces for CenterPoint Energy are:

1. Bargaining power of suppliers: LOW

2. Bargaining power of buyers: MEDIUM

3. Threat of new entrants: HIGH

4. Threat of substitutes: MEDIUM

5. Competitive rivalry: MEDIUM

CenterPoint Energy scores relatively WELL in relation to the Porters 5 forces. The company has LOW bargaining power of suppliers, MEDIUM bargaining power of buyers, HIGH threat of new entrants, and MEDIUM threat of substitutes. The company's competitive rivalry is also only MEDIUM.

PESTLE Analysis

This PESTLE analysis is a strategic planning tool that assesses key external factors affecting the organisation, including the following:

  • Political
  • Economic
  • Social
  • Technological
  • Legal
  • Environmental

Each of these factors is analysed to determine their impact on the organisations strategy, objectives, and operations.

By utilising a PESTLE analysis, the organisation can make better decisions and develop strategies to address potential risks and opportunities.

PESTLE Analysis

CATWOE Analysis

CATWOE

The CATWOE analysis is used to investigate each stakeholders perspectives in order to enable the business to make informed decisions.

The CATWOE analysis is a problem-solving tool consisting of six elements:

  • Customers
  • Actors
  • Transformation process
  • World view
  • Owners
  • Environmental constraints

We view the CATWOE as being most useful when used in conjunction with other problem-solving tools such as a SWOT analysis.

Customers: CenterPoint Energy's customers are residential, commercial and industrial energy users.

Actors: CenterPoint Energy's actors include energy consumers, utilities, gas suppliers, government agencies, energy companies, and energy-related businesses.

Transformation process: CenterPoint Energy's transformation process is focused on providing reliable, cost-effective energy solutions. The company provides natural gas, electricity, and renewable energy products to customers in its service area.

World view: CenterPoint Energy believes in creating a sustainable energy future for their customers. The company is committed to reducing its environmental impact, creating energy efficiency solutions, and providing clean and renewable energy solutions.

Owners: CenterPoint Energy is owned by a variety of stakeholders, including investors, customers, suppliers, and employees.

Environmental constraints: CenterPoint Energy is subject to a variety of environmental regulations and policies. These include rules and regulations related to air and water quality, waste management, energy efficiency standards, green energy initiatives, and renewable energy standards. The company must also adhere to all applicable federal, state, and local laws.

SWOT Analysis

This SWOT analysis is a strategic planning tool used to assess the strengths, weaknesses, opportunities and threats of the CenterPoint Energy business.

When creating this SWOT the team at Platform Executive have taken into consideration the corporate strategy; brand; key financials; the competitive landscape; along with the products and/or services offered.

To offer increased context for future innovation and product development we also consider the historical context for the business and industry; and perceived direction of travel.

Upon researching the company, we have uncovered a number of strategic and operational strengths, weaknesses, opportunities and threats.

SWOT Analysis

Strengths

Below is a list of the strengths we have identified for the business:

1. A Diversified Portfolio of Assets: CenterPoint Energy's portfolio of assets includes electric transmission & distribution, natural gas distribution, and interstate pipelines, which reduces its exposure to any single asset class or geographic region.

2. Low-Cost Operations: CenterPoint Energy has a history of low-cost operations, which has contributed to its strong financial performance.

3. A Strong Balance Sheet: CenterPoint Energy has a strong balance sheet, with a credit rating of "investment grade." This provides the company with flexibility to invest in growth opportunities and weather periods of weaker demand.

4. A Experienced Management Team: CenterPoint Energy's management team has an average of over 25 years of experience in the energy industry. This experience provides the company with a distinct competitive advantage.

Opportunities

Below is a list of opportunities we have identified for the business:

1. Strategic: Increase customer satisfaction by utilizing customer feedback to inform and improve customer service. CenterPoint Energy can use customer surveys, interviews, and feedback forums to identify areas of improvement and implement changes to meet customer needs.

2. Operational: Implement energy efficiency initiatives to reduce energy usage and costs. CenterPoint Energy can identify energy-saving opportunities through advanced metering and data analytics, as well as provide energy efficiency programs and incentives to customers.

3. Strategic: Invest in renewable energy sources to reduce emissions and provide cleaner energy sources. CenterPoint Energy can partner with renewable energy providers and invest in clean energy initiatives to reduce emissions and provide more sustainable energy sources.

4. Operational: Expand distribution networks to improve reliability and reduce maintenance costs. CenterPoint Energy can invest in upgrading existing infrastructure and implementing new technologies to improve reliability and reduce maintenance costs.

Weaknesses

Below is a list of the weaknesses we have identified for the business:

1. Lack of geographic diversity: CenterPoint Energy is focused on providing energy services to customers in the Midwestern and Southern United States. This limits its exposure to other markets and leaves it vulnerable to economic downturns in these regions.

2. Reliance on regulated businesses: A large portion of CenterPoint Energy’s business comes from regulated utilities. This means that its earnings are subject to the whims of government regulators, who can make decisions that adversely impact the company’s financial performance.

3. Limited growth opportunities: CenterPoint Energy’s core businesses are not growing at a rapid pace. This leaves the company with limited opportunities to generate shareholder value through top-line growth.

4. High debt levels: CenterPoint Energy has a significant amount of debt on its balance sheet. This increases the company’s financial risk and makes it more difficult to weather economic downturns or unexpected expenses.

Threats

Below is a list of the threats we have identified for the business:

1. Cybersecurity threats: CenterPoint Energy’s extensive use of technology leaves it vulnerable to cyberattacks. In 2019, the company reported that hackers had accessed some of its customer information.

2. Regulatory changes: Changes in government regulations or policies could affect CenterPoint Energy’s operations and profitability. For example, new environmental regulations could increase the cost of operating power plants.

3. Competitive pressure: CenterPoint Energy faces competition from other energy companies in its market. This competition could lead to lower prices, reduced profits, and difficulty achieving growth.

4. Natural disasters: Natural disasters, such as hurricanes, tornadoes, and floods, can damage CenterPoint Energy’s infrastructure and disrupt operations. In 2017, Hurricane Harvey caused $1 billion in damages to the company’s infrastructure.

5C Analysis

The 5C Analysis is a marketing framework that can be used to provide insight into the key drivers of success, as well as the risk exposure to various environmental factors.
This (concise) 5C analysis examines the external and internal environment for CenterPoint Energy. It includes analysing the company's customers, competitors, collaborators, context, and capabilities. We have produced this short analysis to identify potential opportunities and threats to CenterPoint Energy, as well as areas where the company needs to improve its operations or strategy.
Company: CenterPoint Energy is a leading energy delivery company in the U.S. It distributes natural gas to over seven million customers in eight states and provides electric service to over two million customers in Texas and Arkansas.

Collaborators: CenterPoint Energy works with many industry stakeholders and partners, including local, state and federal agencies, to ensure its services are reliable and safe. It also partners with a variety of technology companies to develop innovative solutions and find ways to enhance customer experience.

Customers: CenterPoint Energy’s customers are residential, commercial and industrial customers in the U.S. It strives to provide reliable and safe energy services to its customers and offers a wide range of energy products and services.

Competitors: CenterPoint Energy’s main competitors include other energy delivery companies, such as Xcel Energy, Atmos Energy and Duke Energy.

Content: CenterPoint Energy’s content focuses on providing helpful information to its customers, such as energy-saving tips, safety advice and product updates. It also promotes itself in the media, including radio and television, and offers digital marketing initiatives, such as email campaigns and social media presence.
5C Analysis

MOST Analysis

MOST Analysis

The MOST analysis framework is commonly used to identify an organisation's strategic goals, assess its strengths and weaknesses, and develop a plan to achieve its objectives. This analysis helps organisations to focus on what they want to achieve and how to achieve it, while also identifying potential roadblocks or obstacles that may arise along the way.

  • Mission
  • Objectives
  • Strategy
  • Tactics

We have created this analysis from a 3rd person perspective.

Innovation Scorecard

As part of our research and analysis activity, the team at Platform Executive assesses and then benchmarks businesses and the industry verticals in which they operate using a proprietary scoring mechanism.

First, we allocate a score of A-E for the industry vertical, gauged on the key organisations operating within the space; and then score the individual business using a 1-5 score.

A score of D-E within an industry means that it is potentially ripe to be disrupted by a new entrant into the marketplace; and/or vulnerable to technological change.

Likewise, a high score of 4-5 for the company in question indicates that in the view of the analysis team it lags behind notable businesses in terms of innovation and product pipeline.

Innovation Scorecard

Below is a guide to each score:

Industry score:

A The industry is amongst the most innovative; with the leading players all driving the sector forward.
Example industry: PaaS
B The industry and its leading players have a good track record of innovation; and can quickly react to change.
Example industry: Pharmaceutical
C Companies operating within the sector have adequate levels of innovation; and engage in R&D activities when appropriate.
Example industry: FMCG
DBusinesses operating in the industry do not invest enough time and resource into innovation. The sector is stagnant and a good candidate for disruption.
Example industry: Retail Banking
E The major players in the sector seem to lack suitable product development roadmaps; and as a result the sector is highly vulnerable to industry change.
Example industry: Publishing

 

Company score:

1 The business is amongst the leading players in terms innovation and product pipeline. This will fulfil and reinforce the operations of the business in the medium to long-term.
2 The business has a good track record of innovation, in terms of its products and/or its business model. It is therefore more likely to be able to react and adapt to any changes to the industry.
3 The business is deemed to have an adequate innovation plan, build on research and development and sustainability where appropriate. The business has a product development strategy.
4The business needs to invest more resource and/or intellectual capital in product development, pipelines and/or its business model. The business is at risk of stagnation.
5 The business seems to lack a suitable product development roadmap; and as a result is vulnerable to any notable industry change and/or new entrants in the marketplace.
The team at Platform Executive has judged CenterPoint Energy as having an innovation score of B2.

Appendices

The appendices section of this report contains supplementary information that the team at Platform Executive deems helpful in providing a more comprehensive understanding of the report's contents.

This information is not considered an essential part of the study but serves as a useful supplement to the main text.

Methodology

This study on CenterPoint Energy forms part of our series of competitive intelligence reports, which focuses on 10,000 of the largest corporates.

The information and data included are updated on a timely schedule to ensure that our Premium members receive the most up to date information .

The report is based on information and learning from the following sources:

  • Corporate websites
  • Proprietary research databases
  • SEC Filings
  • Corporate press releases
  • News articles
  • Financial data API's
  • Product-matching algorithm

Further Information

Premium members: If you cannot find the desired information or data set for the business you are researching then please reach out to our research and analysis team. We can tailor reports to meet your requiremnents, with a fast turnaround time.

If you require a bespoke study on a particular industry vertical, or marketplace we may also be able to help.

Disclaimer

All Rights Reserved.

Reproduction of the content produced in this report is prohibited without the prior permission of the publisher, Platform Executive Pty Ltd.

The facts of this report have been gathered in good faith from both primary and secondary sources. It is believed to be correct at the time of publication, but cannot be guaranteed. As such Platform Executive can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

Changelog

Premium members: To request a priority update to this report, please contact us. Our standard turnaround time is normally 48 hours.

The changelog for this report can be found below, complete with the next scheduled update:

v1.1: Initial load of report
Date: 1st March 2023

Key Financials added (BETA)
Date: 17th March 2023

Next scheduled update: 6th June 2023

Industry Keywords

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