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Released December 28, 2017 | SUGAR LAND
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SUGAR LAND--December 28, 2017--Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Florida Power & Light Company (FPL) (Juno Beach, Florida), one of the nation's largest electric utilities, wants to further increase its reliance on natural gas to generate electricity. In another portion of its generation portfolio, FPL, a unit of NextEra Energy Incorporated (NYSE:NEE) (Juno Beach, Florida), is about half-way through a dramatic expansion of its solar-power buildout. But on a third front, more questions than answers exist about FPL's plan to add more nuclear generation to its resource portfolio.
FPL recently asked the Florida Public Service Commission (PSC) (Tallahassee, Florida) to approve plans to add a 1,163-megawatt (MW) natural gas combined-cycle (NGCC) unit at its Lauderdale (Dania Beach) power plant, located in Broward County. FPL recently renamed that facility the Dania Beach Clean Energy Center. If approved by the PSC, construction of the $888-million Unit 7 could begin in late 2019, and it could enter service by mid-2022.
The project would be the latest large gas-fired generating unit to be built by FPL, as it continues its shift away from coal- and oil-fired generation. In recent years, FPL has built about $6 billion of new gas-fired generation capacity, adding units at its Riviera Beach, Port Everglades, Cape Canaveral, Lauderdale/Dania Beach and West County stations. For more on the utility's recent construction activities, see August 15, 2015, article -Florida Power & Light Continues Generation Turnover With Plans for Another Billion-Dollar, Gas-Fired Power Plant and January 20, 2012, article - FPL Capital Program Bets Big On Low Natural-Gas Prices.
Pending approval, Dania Beach Unit 7 would not become the last gas-fired mega project in FPL's future. In a few years, the utility plans to build a $1.5-billion NGCC station in Hendry County, on Florida's Gulf coast. If FPL receives approval to build that 1,423-MW facility -- called the Hendry County Power Station -- construction could begin in early 2022, and the plant could enter service by mid-2024.
Natural gas generates about 65% of the electricity used by Floridians, according to the PSC, and that percentage seems poised to rise even higher as utilities add new gas-fired units to replace shuttered coal- and oil-fired generation.
Like many other electric utilities around the country, FPL has been closing coal- and oil-fired generation and replacing them with gas-fired and renewable-energy facilities, in response to tougher environmental regulations and customer expectations. Earlier this year, FPL and public power utility JEA (Jacksonville, Florida) announced plans to close the 1,300-MW Saint Johns River Power Park Station in Jacksonville, Florida.. Through ownership and contract, FPL receives about 636 MW of generation from that facility. In a separate decision, the utility acquired a 250-MW coal-fired cogeneration facility but closed it when three solar projects came online. For more on that, see January 9, 2017, article -Florida Power & Light Swaps Out Coal-Fired Plant for Three New Solar Facilities.
FPL also is about half-way through a dramatic buildout of its solar-generation portfolio. The utility is spending an estimated $1.1 billion to build about 596 MW of solar generation at eight sites across the Sunshine State. Plants in Alachua, Putnam, Indian River and Desoto counties are scheduled to finish construction by the end of this year, FPL said. Construction on the other four plants -- located in Brevard, Indian River, Hendry and St. Lucie counties -- is expected to wrap up in early 2018. For more on the decision to build those eight solar plants, see the April 4, 2017, article -FPL Awards EPC Contracts Totaling $900 Million to Build 596 Megawatts of New Solar.
"We're investing nearly $1 billion to grow solar in Florida this year alone, and we're building each of these new solar power plants cost-effectively," FPL President and Chief Executive Eric Silagy said in an October 19statement. "Together, these eight new plants are projected to generate an estimated net lifetime savings of more than $100 million for our customers -- over and above the cost of construction. Our continued commitment to rapidly expand solar energy while keeping customer bills low demonstrates that it is, in fact, possible to be both clean and affordable."
FPL said its long-term resource plans includes the addition of more than 2,300 MW of solar generation between 2016 and 2023. It completed construction of about 225 MW of solar generation in 2016, and the 2,300 MW sum includes the roughly 600 MW of solar currently under construction. The 2,300-MW target would require installation of more than 10 million solar panels, the utility said. The Donald Trump administration reportedly is considering imposing tariffs on solar panels made in China, which could affect the cost and construction schedule of FPL's solar projects in 2018 and beyond.
By 2020, FPL said its resource mix will have more solar generation than oil- or coal-fired generation. It added that Florida ranks ninth in the nation for the quality of solar resource, making it a good place to develop solar generation.
But FPL's transition to a cleaner energy-resource portfolio has not been without the occasional bump when it comes to nuclear power. FPL has for years tried to add two nuclear units to its existing Turkey Point power complex. But as the price tag for that project kept rising, and the cost of gas-fired generation, renewable generation and energy efficiency came down, those proposed units' economic viability has come into question. Turkey Point Units 6 and 7 had been on hold for several years; the last cost estimate to build the two 1,100-MW units was about $18 billion. In early 2016, FPL decided to postpone the start of pre-construction activities for Turkey Point Unit 6 and 7 until at least 2020. For more on that, see the June 15, 2016, article -Construction of Florida Nuclear Units Pushed Back at Least Four Years.
But in the intervening time, Westinghouse Electric Company (Pittsburgh, Pennsylvania), which developed the AP1000 reactor that is slated to be installed in Turkey Point Units 6 and 7, declared bankruptcy and exited the nuclear construction business. For more on that, see March 30, 2017, article -U.S. Nuclear Power Project Developers Weigh Options in Wake of Westinghouse Bankruptcy. Also, two U.S. nuclear construction projects using the AP1000 reactor have run wildly over budget and behind schedule. One project, at the Virgil C. Summer plant in South Carolina, was abandoned after the owners invested nearly $10 billion to add two new units to that station. For more on that, see September 5, 2017, article -Summer Nuclear Units' Cancellation Followed by Two Other Terminations.
Regulators also are mulling the fate of the second U.S. nuclear construction project involving the AP1000 reactor, the two-unit addition to the Alvin W. Vogtle nuclear station in Georgia. That project, which is billions of dollars over budget and years late in delivery, is the subject of a hotly contested regulatory process in Georgia. For more information, see Industrial Info's September 1, 2017, article -Georgia Power Recommends Construction Continue at Vogtle. For details on both projects, see the project reports for the Vogtle and Summer plants.
Earlier this month, the Nuclear Regulatory Commission (NRC) (Bethesda, Maryland) held a hearing on FPL's license application for Turkey Point 6 and 7. NRC Spokesman Scott Burnell told Industrial Info a final decision on awarding a license to Turkey Point likely won't come until January 2018 at the earliest.
In applying for a license for the two new units, FPL committed to installing AP1000 reactors at the facilities. Given Westinghouse's decision to exit the nuclear construction business, it's unclear whether the AP1000 reactors, or another type of reactor, would be installed.. Since the Turkey Point license application specified deploying AP1000 reactors, Burnell said, "Attempting to amend an issued construction and operating license (COL) to a new design is unchartered territory. It would almost certainly require significant, lengthy re-review of both the safety and environmental issues that were resolved for the AP1000." The NRC has certified other advanced reactor designs.
Repeated efforts to reach FPL or Westinghouse for comment about Turkey Point Units 6 and 7 and the fate of the AP1000 reactors were unsuccessful.
Recently, Florida's utility regulators denied an FPL request to collect millions of dollars from customers for licensing and pre-construction costs for the Turkey Point nuclear units. Customers reportedly have already paid nearly $282 million for those pre-construction fees, which is permitted under Florida law providing the utility prepares an analysis that the future nuclear plants are feasible. Since FPL did not prepare a feasibility study for 2017, the utility will not be able to collect pre-construction from customers for 2017, according to an October 17 PSC ruling.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle TM, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com
FPL recently asked the Florida Public Service Commission (PSC) (Tallahassee, Florida) to approve plans to add a 1,163-megawatt (MW) natural gas combined-cycle (NGCC) unit at its Lauderdale (Dania Beach) power plant, located in Broward County. FPL recently renamed that facility the Dania Beach Clean Energy Center. If approved by the PSC, construction of the $888-million Unit 7 could begin in late 2019, and it could enter service by mid-2022.
The project would be the latest large gas-fired generating unit to be built by FPL, as it continues its shift away from coal- and oil-fired generation. In recent years, FPL has built about $6 billion of new gas-fired generation capacity, adding units at its Riviera Beach, Port Everglades, Cape Canaveral, Lauderdale/Dania Beach and West County stations. For more on the utility's recent construction activities, see August 15, 2015, article -Florida Power & Light Continues Generation Turnover With Plans for Another Billion-Dollar, Gas-Fired Power Plant and January 20, 2012, article - FPL Capital Program Bets Big On Low Natural-Gas Prices.
Pending approval, Dania Beach Unit 7 would not become the last gas-fired mega project in FPL's future. In a few years, the utility plans to build a $1.5-billion NGCC station in Hendry County, on Florida's Gulf coast. If FPL receives approval to build that 1,423-MW facility -- called the Hendry County Power Station -- construction could begin in early 2022, and the plant could enter service by mid-2024.
Natural gas generates about 65% of the electricity used by Floridians, according to the PSC, and that percentage seems poised to rise even higher as utilities add new gas-fired units to replace shuttered coal- and oil-fired generation.
Like many other electric utilities around the country, FPL has been closing coal- and oil-fired generation and replacing them with gas-fired and renewable-energy facilities, in response to tougher environmental regulations and customer expectations. Earlier this year, FPL and public power utility JEA (Jacksonville, Florida) announced plans to close the 1,300-MW Saint Johns River Power Park Station in Jacksonville, Florida.. Through ownership and contract, FPL receives about 636 MW of generation from that facility. In a separate decision, the utility acquired a 250-MW coal-fired cogeneration facility but closed it when three solar projects came online. For more on that, see January 9, 2017, article -Florida Power & Light Swaps Out Coal-Fired Plant for Three New Solar Facilities.
FPL also is about half-way through a dramatic buildout of its solar-generation portfolio. The utility is spending an estimated $1.1 billion to build about 596 MW of solar generation at eight sites across the Sunshine State. Plants in Alachua, Putnam, Indian River and Desoto counties are scheduled to finish construction by the end of this year, FPL said. Construction on the other four plants -- located in Brevard, Indian River, Hendry and St. Lucie counties -- is expected to wrap up in early 2018. For more on the decision to build those eight solar plants, see the April 4, 2017, article -FPL Awards EPC Contracts Totaling $900 Million to Build 596 Megawatts of New Solar.
"We're investing nearly $1 billion to grow solar in Florida this year alone, and we're building each of these new solar power plants cost-effectively," FPL President and Chief Executive Eric Silagy said in an October 19statement. "Together, these eight new plants are projected to generate an estimated net lifetime savings of more than $100 million for our customers -- over and above the cost of construction. Our continued commitment to rapidly expand solar energy while keeping customer bills low demonstrates that it is, in fact, possible to be both clean and affordable."
FPL said its long-term resource plans includes the addition of more than 2,300 MW of solar generation between 2016 and 2023. It completed construction of about 225 MW of solar generation in 2016, and the 2,300 MW sum includes the roughly 600 MW of solar currently under construction. The 2,300-MW target would require installation of more than 10 million solar panels, the utility said. The Donald Trump administration reportedly is considering imposing tariffs on solar panels made in China, which could affect the cost and construction schedule of FPL's solar projects in 2018 and beyond.
By 2020, FPL said its resource mix will have more solar generation than oil- or coal-fired generation. It added that Florida ranks ninth in the nation for the quality of solar resource, making it a good place to develop solar generation.
But FPL's transition to a cleaner energy-resource portfolio has not been without the occasional bump when it comes to nuclear power. FPL has for years tried to add two nuclear units to its existing Turkey Point power complex. But as the price tag for that project kept rising, and the cost of gas-fired generation, renewable generation and energy efficiency came down, those proposed units' economic viability has come into question. Turkey Point Units 6 and 7 had been on hold for several years; the last cost estimate to build the two 1,100-MW units was about $18 billion. In early 2016, FPL decided to postpone the start of pre-construction activities for Turkey Point Unit 6 and 7 until at least 2020. For more on that, see the June 15, 2016, article -Construction of Florida Nuclear Units Pushed Back at Least Four Years.
But in the intervening time, Westinghouse Electric Company (Pittsburgh, Pennsylvania), which developed the AP1000 reactor that is slated to be installed in Turkey Point Units 6 and 7, declared bankruptcy and exited the nuclear construction business. For more on that, see March 30, 2017, article -U.S. Nuclear Power Project Developers Weigh Options in Wake of Westinghouse Bankruptcy. Also, two U.S. nuclear construction projects using the AP1000 reactor have run wildly over budget and behind schedule. One project, at the Virgil C. Summer plant in South Carolina, was abandoned after the owners invested nearly $10 billion to add two new units to that station. For more on that, see September 5, 2017, article -Summer Nuclear Units' Cancellation Followed by Two Other Terminations.
Regulators also are mulling the fate of the second U.S. nuclear construction project involving the AP1000 reactor, the two-unit addition to the Alvin W. Vogtle nuclear station in Georgia. That project, which is billions of dollars over budget and years late in delivery, is the subject of a hotly contested regulatory process in Georgia. For more information, see Industrial Info's September 1, 2017, article -Georgia Power Recommends Construction Continue at Vogtle. For details on both projects, see the project reports for the Vogtle and Summer plants.
Earlier this month, the Nuclear Regulatory Commission (NRC) (Bethesda, Maryland) held a hearing on FPL's license application for Turkey Point 6 and 7. NRC Spokesman Scott Burnell told Industrial Info a final decision on awarding a license to Turkey Point likely won't come until January 2018 at the earliest.
In applying for a license for the two new units, FPL committed to installing AP1000 reactors at the facilities. Given Westinghouse's decision to exit the nuclear construction business, it's unclear whether the AP1000 reactors, or another type of reactor, would be installed.. Since the Turkey Point license application specified deploying AP1000 reactors, Burnell said, "Attempting to amend an issued construction and operating license (COL) to a new design is unchartered territory. It would almost certainly require significant, lengthy re-review of both the safety and environmental issues that were resolved for the AP1000." The NRC has certified other advanced reactor designs.
Repeated efforts to reach FPL or Westinghouse for comment about Turkey Point Units 6 and 7 and the fate of the AP1000 reactors were unsuccessful.
Recently, Florida's utility regulators denied an FPL request to collect millions of dollars from customers for licensing and pre-construction costs for the Turkey Point nuclear units. Customers reportedly have already paid nearly $282 million for those pre-construction fees, which is permitted under Florida law providing the utility prepares an analysis that the future nuclear plants are feasible. Since FPL did not prepare a feasibility study for 2017, the utility will not be able to collect pre-construction from customers for 2017, according to an October 17 PSC ruling.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle TM, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com
