NextEra Eyes Strong Backlog, Data Center Hub Strategy

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Written by Danny Levin, Deputy Editor for IIR News Intelligence (Sugar Land, Texas)

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Summary

NextEra highlighted its renewables and battery storage backlog as well as its model for powering data centers without straining the power grid or raising costs for ratepayers.

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NextEra is Well-Positioned to Meet Demand

NextEra on October 21 highlighted its renewables and battery storage backlog and its model for supplying data centers and other large-load customers without straining the power grid or raising costs for ratepayers.

The company added 3.7 gigawatts (GW) of renewables and battery storage capacity to its backlog in the third quarter, with battery storage accounting for 2.4 GW--driving the total backlog to about 36.7 GW.

"With these new additions to our backlog and projects that reached commercial operation, we've now achieved greater than two-thirds of the midpoint of our 2026 through 2029 development expectations and we added approximately 15 gigawatts to the backlog in the last 12 months," John Ketchum, chief executive officer of NextEra, said in the company's recent third-quarter earnings conference call.

Industrial Info Resources data show there is $6.6 billion worth of projects under construction from NextEra, nearly all of which is attributed to solar and battery energy storage-system (BESS) projects. This includes its NextEra Energy Resources (NEER) merchant energy business and Florida Power & Light (FPL) subsidiary.

Projects include:

400-megawatt (MW) High Spring solar plant in Muskogee, Oklahoma

451.5-MW Ziessel Solar facility in Knox County, Texas, north of Abilene

Panama Energy Center in Martell, Nebraska, southwest of Lincoln, consisting of a 304-MW solar facility and 80-MW BESS unit

Industrial Info Resources offers more information on these projects, each of which could wrap up by the end of 2028, in its Global Market Intelligence (GMI) Power Project Database, where subscribers can find details in project reports.

Hub Strategy for Data Centers, Large Loads

"To date, we've advanced more than 20 gigawatts of large-load projects -- over 18 gigawatts of which are gas-fired generation," Ketchum said.

The portfolio relies on NextEra's new "hub strategy" aimed specifically at meeting large-load demand, envisioning multi-gigawatt power-generation sites feeding directly into data centers and bypassing the power grid altogether.

NextEra announced it has signed definitive agreements for about 16.5 GW worth of capacity through three "federal hubs," where Ketchum says the company "expects to develop, build, and operate projects for fees without investing capital."

Dubbed "federal" hubs, they are tied to a larger $550 billion investment commitment from Japan as part of a U.S.-Japan trade deal, with the projects jointly owned by the U.S. and Japan. NextEra said the projects have received $5.7 billion in initial funding year-to-date.

This includes two sites, one in Texas and another in Pennsylvania; view the related project reports and plant profiles.

"We are advancing construction and PPA [power purchase agreement] solicitation in parallel to maximize speed to market while working to secure required permits and other approvals," he said.

The projects are expected to be operational as early as 2028 and 2029, with full completion lasting through 2032.

Without putting capital into the projects, "we expect federal hubs to generate approximately 50% of the expected adjusted earnings per share that Energy Resources [NextEra Energy Resources] would receive if we own the projects ourselves over the first 20 years of operation."

He also highlighted the opportunity to build and own battery storage to support data center load at the federal hub opportunities.

He also noted "a development pipeline of 30 potential hubs we are discussing with the market, and we continue to expect that number to rise to 40 by year-end," in addition to advancing a "significant pipeline of large-load projects that we expect to own and operate ourselves."

NextEra is in the process of recommissioning and restarting its nuclear Duane Arnold Energy Center near Palo, Iowa, by early 2029. Alphabet Incorporated, the parent company of Google, has agreed to purchase power from the 615-MW plant to fuel its artificial intelligence (AI) and other operations in Iowa. Readers can view a plant profile and project report.

Industrial Info Resources data show $130 billion worth of active and planned projects overall from NextEra. View a full list here.

Pending Merger with Dominion Energy

NextEra's proposed $67 billion, all-stock merger with Dominion Energy is moving forward amid regulatory scrutiny. Shareholders of both companies approved the transaction in September, and state regulatory reviews and federal review processes are underway; however, state regulators and elected officials have raised concerns regarding costs to ratepayers and the concentration of power in a combined entity that would have 10 million customers across multiple states.

Virginia Lieutenant Governor Ghazala Hashmi (D) has said the acquisition is "not in the best interest of Virginians," while Governor Abigail Spanberger (D) proposed a six-year rate freeze as one of a set of conditions she said state regulators should impose if they approve the merger.

"Dominion Energy would remain locally led and separately regulated while gaining access to NextEra Energy's experience across the full energy value chain," Ketchum said in the recent earnings call.

Ketchum said he expects the combination will close in the second half of 2027.

Key Takeaways

• NextEra added renewables and storage capacity to its backlog.
• The company's data center hub model is gaining traction, with definitive agreements for 16.5 GW of contracted load in place.
• $6.6 billion: Total value of projects under construction from NextEra, mainly solar and BESS.
• $130 billion: Total value of active and planned projects from NextEra.

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About Industrial Info Resources
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, Industrial Info Resources is tracking over 250,000 current and future projects worth $30.2 trillion (USD).