“Market Cap $40.85 B As of May 2014
At a Glance
- Industry: Electric Utilities
- Founded: 1985
- Country: United States
- CEO: James Robo
- Website: www.nexteraenergy.com
- Employees: 13,900
- Sales: $14.56 B
- Headquarters: Juno Beach, Florida
#276 Global 2000
- #657 in Sales
- #345 in Profit
- #362 in Assets
- #244 in Market value
NextEra Energy, Inc. operates as an investment holding company with interests in generating and distributing electricity. The company through its subsidiaries provides retail and wholesale electric services to customers and owns generation, transmission and distribution facilities to support its services. It also produces electricity from solar facilities, and owns and operates fleets of nuclear power stations in the U.S. The company operates its business with the names of subsidiaries as their segments namely Florida Power & Light Co, NextEra Energy Resources LLC and Corporate and Other. The Florida Power & Light Co. segment engages primarily in the generation, transmission, distribution and sale of electric energy in Florida. The NextEra Energy Resources LLC segment produces the majority of its electricity from clean and renewable sources, including wind and solar. It also provides full energy and capacity requirements services, engages in power and gas marketing and trading activities, participates in natural gas production and pipeline infrastructure development and owns a retail electricity provider. The Corporate and Other segment represents other business activities. NextEra Energy was founded in 1984 and is headquartered in Juno Beach, FL.“
“NextEra Energy History
Pioneers of Power: 1925-1929
“We had a heck of a time getting the poles to set in the swamp, mud and muck. But if you put a stick of dynamite on the bottom of a pole, stood it up straight and shot it off, the pole would jump in the air and then drop into the newly created hole. We called that ‘shooting the poles.’” — FPL lineman, on working in the 1920s.
The birth of FPL
FPL was born in the final days of 1925 when
- Florida was experiencing the greatest land boom the nation had seen
- cities were springing up overnight
- residents were pouring into the state by the thousands and
- a dependable supply of electricity was desperately needed.
The founding company
FPL’s earliest roots can be traced back to Thomas Edison and the General Electric Co. GE created EBASCO (Electric Bond and Share Co.), owner of American Power & Light Co. that held many utilities in the western hemisphere.
FPL – a consolidation
American Power & Light purchased the properties that were consolidated to form FPL on Dec. 28, 1925. The unlikely patchwork of enterprises included small electric generating plants, ice plants, water, gas, fish, telephone, sawmill and street car companies, a steam laundry, an ice factory, a limestone quarry, a sponge fishing boat and even 35 mules and wagons.
Dark Days, Brighter Horizons: 1930-1944
“I’ll never forget the day the manager told us all of the hotels had been taken over by the Army. And very soon before dawn, we heard men marching in the streets. Once I had to ask soldiers to move a pup tent out of my driveway so I could get to work.”
— Secretary in the FPL Miami Beach Office, 1940.
The hurricanes in the 1920s, combined with the stock market crash, sent both Florida and FPL reeling through the Depression years. The challenges included:
- Mounting unpaid bills, though the minimum monthly electric bill was $1
- people attempting to steal electricity
- turning FPL offices into showrooms for selling appliances
- laying off workers and cutting the pay of those who stayed and
- in 1933, telling FPL shareholders there would be no dividends.
By 1939, however, Florida’s economic skies were brightening. FPL
- served more than 141,000 customer accounts with electricity
- served more than 18,700 customer accounts with gas and
- doubled its original generating capacity to 155 megawatts.
Then came 1941 and war. FPL met the challenge and
- published ads calling for conservation
- training women to do the work of over one-quarter of the employees who had been called to war
- expanded the work week to Saturdays to meet the demands of powering large military institutions and defense industries in its territory and
- worked with adjoining utility companies in a spirit of unity to interconnect power lines and systems for wartime emergencies.
FPL awarded citation
FPL’s response to the war years did not go unnoticed. On Feb. 1, 1944, Admiral W. R. Munroe, commandant of the Seventh Naval District, presented FPL with a Citation for Meritorious Wartime Service. He was quoted: “When we asked for power, we got power; and not, thank God, alibis!”
The Building Years: 1945-1960
“The tendency to persevere, to persist in spite of hindrances, discouragement and impossibilities, it is this that in all things distinguishes the strong soul from the weak.”
— Plaque that belonged to McGregor Smith, former FPL president.
During the postwar period from 1945-1960, new residents poured into Florida at the rate of 3,000 per week. By 1960, Florida was the 10th most populous state in the nation, compared with its 20th ranking in 1950.
Meeting the explosive demand
Demand for power was so great that FPL quadrupled its generating power by
- building new plants at Palatka, Riviera, Sarasota, Fort Myers and Cutler
- expanding plant facilities at Miami, Sanford and Lauderdale
- leasing a Navy power ship docked at Port Everglades and
- equipping two large railroad cars and trailers with generators and moving them around the state to meet seasonal peak power demands.
Financing the growth
To finance Florida’s growing demand for power, FPL joined the New York Stock Exchange in 1950. The following year, the company announced a $435 million, 10-year expansion program that would take it into the 1960s.
In 1957, FPL filed for a $4.4 million rate decrease, the first of 11 rate decreases over the next 15 years.
In 1960, FPL built a new unit at Port Everglades with plans for three more units – just in time. New residents were coming from all directions, lured by the Space Age from the north and by simple freedom from the south as Cuban exiles hit Miami’s shores.
Space Age to Nuclear Age: 1961-1972
“U.S. Fires Astronaut Out of This World”
— Miami News, May 5, 1961.
Space age challenges
FPL did its part to meet the Space Age challenges of putting a man on the moon. Starting in 1964, FPL built the Cape Canaveral plant to provide
- 425 megawatts of power, twice the amount in the entire FPL system only 20 years earlier, and
- a plentiful supply of power to the missile complex and the expanding surrounding residential and industrial areas.
A stormy decade
Weather turned out to be another of FPL’s challenges in the 1960s. These stormy years brought the following hurricanes that hit FPL’s service areas: Cleo, Dora, Betsy, Alma and Inez.
Nuclear age plants
In 1965, FPL announced plans to build a $100 million nuclear power plant at Turkey Point. In 1972, FPL brought Turkey Point Unit 3 on line, followed by Unit 4 in 1973.
Partnering with the community
In the process of building the Turkey Point plant, FPL found opportunities to partner with community organizations to use Turkey Point land for:
- Dade County’s largest and most pristine wildlife sanctuary for birds, fish and other wildlife
- Boy Scout and Girl Scout camps, along with a home for a full-time Florida Board of Conservation ranger, and
a sea survival school near the site created by the Air Force.
Crisis and Challenge: 1973-1999
“This country cannot be dependent upon foreign oil, or the day will come when the lights will go out.”
— FPL official, 1970s.
The 1970s challenged FPL in new ways. Management had to deal with
- the OPEC oil embargo, causing petroleum prices to rise from $4 a barrel in 1972 to more than $30 by 1981,
- FPL’s dependency on oil for more than 50 percent of its generation
- a recession that gripped the nation with double-digit inflation and interest rates
- requesting FPL’s first general rate increase in history in 1972, with other rate increases and denials of rate increases following,
- stalled construction projects and financial difficulties, and
- the national controversy over nuclear power after Three Mile Island.
FPL emerged from this time of crisis to make several important changes:
- Instead of promoting the use of electricity, FPL would focus on promoting the conservation of energy and become an industry leader in environmental performance.
- FPL Group Inc., a new holding company, was formed in 1984. This enabled the company to expand through the creation of new companies and the acquisition of existing ones.
- By converting some oil-fired units to natural gas, adding new nuclear units and contracting with neighboring utilities to purchase coal-fired power, oil dropped to 26 percent of FPL’s generation by 1988.
New nuclear plant
In 1976, St. Lucie unit 1 went on line followed in 1983 by unit 2. Considering the times and circumstances, unit 2’s completion in an industry-record six years was an amazing feat.
Through it all, FPL tackled the challenges and flourished, earning
- the Edison Electric Institute’s prestigious Edison Award in 1986
- numerous accolades for its environmental programs
- acclaim for its innovative Quality Improvement Program and
- the Deming Prize in 1989 – the first non-Japanese company ever to capture the coveted quality award.
FPL continued to face challenges in the 1990s:
- Sweeping federal initiatives to deregulate the utility industry created more energy choices for customers than ever before. Utilities that would prosper in this highly competitive environment would be those that delivered quality and reliable services at the lowest prices.
- FPL worked to reduce costs and streamline its operations. Operations and maintenance expenses are reduced by 36 percent from 1990 through 1999.
- Hurricane Andrew, the nation’s most costly natural disaster, strikes South Florida in 1992 causing extensive damage to FPL’s system. Thousands of FPL employees, many victims of the storm, work tirelessly to restore electricity to 1.4 million homes and businesses in just over a month.
A new “generation” of power plants
State-of-the-art combined cycle units, an industry showcase for efficiency, entered service at the Martin plant in 1994 more than $100 million below budget.
The Fort Lauderdale plant, site of FPL’s first power plant construction project in 1925, is repowered in the 1990s to nearly triple the plant’s generating capacity.
Growth beyond FPL’s service area
FPL Energy (renamed NextEra Energy Resources in 2008) was formed in 1998 to manage NextEra Energy’s growing interests in electricity markets outside FPL’s Florida service area. The subsidiary focuses on clean energy technologies and fuels such as
- hydro, and
- natural gas
Substantial Growth and The Great Recession: 2000-2009
“At NextEra Energy, Inc. we do more than talk about sustainability. We embody it. In just over a decade, we’ve committed more than $10 billion to renewable energy. Today, we’re the leading renewable energy company in North America. We’re No. 1 in wind energy production and No. 1 in solar power, too.”
— Lew Hay, NextEra Energy, Inc. Chairman and CEO, 2009.
Industry and economic challenges
In the first decade of the 21st century, the electric industry faced challenging events that continue to have an impact on NextEra Energy:
a failed attempt at energy restructuring in California, followed by warnings of a national power shortage, then the fear of a glut of generating capacity in most regional markets
the collapse of Enron and other companies, raising serious concerns about business ethics and financial integrity
continued volatility in the market price for natural gas, followed by discoveries of unprecedented reserves
a high-profile national debate over the best response to global warming, and
new federal energy legislation, with important provisions related to wind energy, nuclear power, energy conservation and industry structure.
New ways to manage
NextEra Energy is responding with initiatives that include:
- improving commercial skills and pioneering new ways to do business
- streamlining operations and lowering costs
- improving customer focus, service and responsiveness,
- growing its emissions-free wind power, solar power and nuclear power businesses, and
- maintaining a corporate governance structure and financial reporting process that reflect the best practices in the industry.
In recognition of our achievements in clean energy production, environmental excellence, customer satisfaction and shareholder value, NextEra Energy was named the 2003 winner of the Edison Award, the electric industry’s highest honor.
Dramatic growth outside of Florida
NextEra Energy subsidiary NextEra Energy Resources is a clean energy leader and one of the largest competitive energy suppliers in North America.
- This business is the largest generator in North America of renewable energy from the wind and sun.
- The company operates nearly 9,000 wind turbines at more than 70 wind projects located in 17 states and two Canadian provinces.
- It operates the largest solar power plant in the world in California’s Mojave Desert – the 310-megawatt Solar Electric Generating Systems (SEGS).
- NextEra Energy Resources also operates clean, emissions-free nuclear power generation facilities in New Hampshire, Iowa and Wisconsin as part of the NextEra Energy nuclear fleet, which is the third largest in the United States.
- Going forward, NextEra Energy Resources has a strong pipeline of attractive renewable energy projects.
New plants and customer programs at FPL
FPL added its 4 millionth customer in 2002 and continues to take actions to meet its customers’ demand for reliable electric service and help them take more control over their energy use:
- More than 1,000 megawatts of clean, natural gas-fired generation were added to FPL’s system in 2002 with the repowering of existing power plants at FPL’s Fort Myers and Sanford locations, and an additional 1,900 megawatts entered service at the Manatee and Martin plants in 2005.
- A new natural gas-fired power generating unit at FPL’s Turkey Point site south of Miami was commissioned in 2007. The unit serves some 230,000 Florida homes and businesses.
- FPL received approval from the Florida Public Service Commission (PSC) to build three combined cycle generating units at the company’s West County Energy Center. Two of the units, serving a total of 500,000 Florida homes and businesses, are already online, and the third unit is under construction and is expected to go into service in 2011. These investments are increasing the efficiency of the FPL generation fleet and providing savings to customers.
- FPL is also moving forward with nuclear “uprates” at its St. Lucie and Turkey Point nuclear power plants, which will add 400 megawatts of emissions-free power.
- In 2009, FPL commissioned the DeSoto Next Generation Solar Energy Center, the largest solar photovoltaic power plant in the United States. Construction is also underway at two other FPL solar plants in Florida, one at the Martin plant location and one on the Space Coast.
- During the decade, FPL expanded dramatically the services available to customers on its Web site, www.FPL.com. Customers can receive and pay their electric bill, connect or disconnect service, access useful energy information such as an online home energy audit, and more.
- FPL continues to offer a variety of energy efficiency and load management programs to help customers hold down energy costs and exercise more control over energy consumption. Since 1981, these programs have avoided the need to build 12 additional power plants.
Responses to the “Great Recession”
Success is often determined not by how well you do in good times, but how you respond to adversity. NextEra Energy has actively responded to the challenges of the extraordinary 2008-2009 “Great Recession.” The company:
- made tactical adjustments to its financing plan and focused on maintaining access to capital
- reduced capital expenditures in its wind program and elsewhere
- increased focus on expanded electric transmission systems, especially in West Texas, so that renewable energy can more easily be brought to the population centers where it’s needed most, and
- increased its commitment to shaping the public policy debate.
A low-carbon leader
Through NextEra Energy’s substantial investments in low-carbon electricity generation, the company is now one of the cleanest power companies in the nation. Consider:
- If every utility had made the choices NextEra Energy has made over the years, carbon dioxide emissions from the electric power sector, which is responsible for 40 percent of America’s CO2 output, would be cut in half.
- For the United States as a whole, that translates into a 20 percent emissions reduction, which is the equivalent of removing 209 million cars from the road. That’s eight out of every 10 vehicles – just from asking the power industry to match NextEra Energy’s emissions profile.
Taking a stand on climate change
NextEra Energy has been a leader in advocating for prompt action to address climate change.
- In June 2008, for example, Chairman and CEO Lew Hay spoke at the Florida Summit on Global Climate Change in Miami. “Every day we delay,” he said, “another 18 million tons of CO2 are released into the atmosphere, most of which will remain there for close to a century. And with every year of inaction, the carbon reductions needed to deal successfully with climate change become larger and harder to achieve.” We need real leadership on climate change – leadership that looks at the challenge of ‘decarbonizing’ the $14 trillion U.S. economy and says, ‘We can do this.’ Leadership that considers the consequences of inaction and says, ‘We must do this.’ Leadership that recognizes America’s obligation to set an example for other countries around the world and says, ‘We will do this.’”
- In February 2009, Mr. Hay told a meeting of the National Association of Regulatory Utility Commissioners in Washington, D.C., that “Carbon emissions impose huge costs on society – costs that the emitters don’t bear. To use a phrase you don’t normally hear from a power company CEO, we must ‘make polluters pay.’ Only when carbon carries a price equal to its cost to society as a whole will we have a level playing field among all forms of electricity generation.”
*Information from Forbes.com and Nexteraenergy.com
**Video published on YouTube by “FPL“