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HomeMy WebLinkAboutSubmittal - Articles Submitted by Councilman Luis GonzalezNey.tEra Energ-y, inc. NextEra Energy, inc. (NYSE: NEE) is a leading dean energy company with revenues of more than $15.3 billion, more than 41,000 megawatts of generating capacity, and approximately 15,000 employees in 24 states and Canada as of year-end 2011. Headquartered in Juno Beach, Fla., NextEra Energy's principal subsidiaries are Florida Power & Light Company, which serves approximately 4.6 million customer accounts n Florida and is one of the largest rate -regulated electric utilities in the country, and NextEra Energy Resources, LLC, which together with its affiliated entities is the largest generator in the United Cates of renewable energy from the wind and sun. Through its subsidiaries, NextEra Energy generates _ieari, ern ssions-tree electricity from eight commercial nuclear power units in Florida, New Hampshire, Iowa and Wisconsin. For more information about NextEra Energy corpanies, visit these wehsites: www.NextEraEnergy.com. www.FPL.com, www.NextEraEnergyResources.com. In April 2009( 8usinessWeek agazine reported that FPL Group was one of 25 US companies that paid the least US troup paid a 1.3 percent annual tax rate, far Tess than the standard 35 percent corporate rate, based on an analysis of the company's financial figures for 2005-2008. On more than $7 billion in company earnings during this four-year period, FPL Group paid $88 million in taxes. This low rate was possible given tax breaks for having invested in alternative energy. A company spokesperson said the company is merely taking advantage of incentives to develop renewable resources. To ensure these tax breaks continue, in 2008 &one, FPL Group paid more than $500,000 to five major lobbying firms that lobby Congress. 17 SU3MTTEDSlif3MITTED,INITO TNE PALICRECORD FOR 1TEMD4.I 2-DO7244 5a17m'1f-at -- Ar-E+CIe , atiorniiied it COLIY1Luis COrratl€,Z UUJII IC JJ VV U I I ICI I I IUI IUI CU for community work. 8B win we escape a nit rnis nurricane season r Smooth sailing: The cruise Industry expects to book more passengers this year than In 2011.9B SPORTS Powerhouses clash: FSU versus Clemson It's been a while since FSU hosted a game featuring two top 10 ACC teams, IC Jets'advantage?'Fins -.. otconcerned that former coach Sparano will be on other sideline Sunday.IC High school football: American Heritage wins big; Park Vista beats Glades Central, 24-14.1C Dear Abby 2D Classifieds 1E Crosswords 9D,11E Deaths 68 9D 28 8D 9C Horoscope Lottery Movie Listlns Scoreboard To subscribe to The Palm Beach Post, call 561-820-4663 Copyright 2012 The PI11m Beach Post Vol. 43 No. U 6 section iw. Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk High-level winds are keeping storms away. By EliotKlelnberg Palm Beach Post StaffWriter. Florida, which hasn't had a hurricane make landfall since. 2005, just might escape this season without one coming ashore, a commercial weather site suggested this week. A pattern that developed over the central and eastern United States during early Sep- tember will continue to act as a buffer against major tropical systems through the end of the month, and perhaps through the season, AccuWeather.com reported. Westerly winds in the mid- dle and upper levels of the at- mosphere over the central and eastern parts of the country and nearby waters are brining in streams of dry air that "are generally too disruptive for tropical storms or hurricanes to form in nearby coastal waters and tend to cause tropical sys- tems coming from afar to avoid the Gulf and Atlantic coasts of the U.S.," AccuWeather.com senior meteorologist Dan Kot- tlowski said Thursday. Tropical Storm Nadine, its Hurricanes continued on 4A POST IN TALLAHASSEE MERIT RETENTION Fla. GOP joins fight to unseat 3 justices By.lohn Kennedy Palm Beach Post Capital Bureau TALLAHASSEE — The Florida Republican Party said Friday it is adding its heft to an effort to un- seat the last three state Supreme Court justices appointed by a Democratic governor. State GOP Chairman Lenny Curry said the par- ty's executive board has voted to oppose the mer- it retention of Justices Barbara Pariente, Fred Lewis and Peggy Quince on Nov. 6. A conserva- tive group, Restore Justice 2012, has labeled the three a liberal -leaning bloc on the seven -member court, which has stymied a variety of initiatives advanced by the Republican -ruled legislature in recent years. ontinued on SA State GOP Chairman Len- ny Curry calls the Justices Ilberal-lean- Ing activists, pointing to a specific death penalty ruling. Reduced tropical threat Accuweather.com projects wind patterns will keep storms away from the U.S. East Coast through the end of September. Strong south, westerly winds BRENNAN KING / THE PALM BEACH POST POST COVERAGE FPL RATE HIKE CASE FPL wants to increase fees for late payments By Susan Salisbury Palm Beach Post Staff Writer Florida Power & Light Co. wants to raise late -payment charges and returned -payment fees for customers in 2013, a step that could increase its rev- enues by as much as $45 million next year. The thinking is, said FPL spokesman Mark Bubriski, that increasing the charges will gen- erate more revenue without contributing to a further in- crease in base rates. Customers who pay their bills late would face costlier penalties, and customers who pay on time would not incur any of that cost. All customers face the possibility of overall bill increases in 2013. "We don't think those who pay late should be subsidized by those who pay on time," said FPL spokeswoman Alys Daly. Public Counsel J.R. Kelly, who represents ratepayers, said higher late fees will put a big- ger burden on people already. struggling to pay their bills. "It will put it on the backs of those who can least afford it," FPL continued on 5A /11/12 FPL's profit was $945 million last year, up 14 percent - Sun Sentinel Home Collections Profit Buy This "Gas Killer" Now The stock That could end the gasoline engine is alreadyup 34%. Setter EneruvManagement Estimate More EfficlentOperations. Try Our Efficiency Calailatoft v:I b.n,r'r „01' MagnaLicsht On Sale Specialty Lighting Commercial App. Get 55 Off. Use Code: MGLIGHTS Low Cost Health Insurance Blue Cross. Aetna. CIGNA & More! Get the Coverage You Need. Related Articles FPL's parent NextEra Energy pollutes relatively little for its size. new study on electric companies finds Don't raise our electric bill, FPL ntstomers tell PSC FPL could be a big winner In tax -cut law FPL plans to Install more 'smart m eters' to help customers sane money Scripps scientists team with FPL on major solar energy project Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk Video FPL's profit was $945 million last year, up 14 percent January25. 2011 I South florida Sun -Sentinel NextEra Energy's profit was dose to $2 billion last year, including $945 million for Florida Power & Light, the state's largest utility. 0 Tweet Both companies reported a rise in net profit for the year despite decreases in revenues in the fourth quarter, according to figures they released this morning. Alternative Energy BP is Imestinq in business and technology to deliver clean energy. Save More with Echo® $0 Down Lease - Get a free quote! More powerful and more advanced. oetrotirst.aum The net profit tor FPL, the state's largest utility, rose 14 percent to $945 million, up from $831 million in 2009. That's higher than the 5 percent increase it reported from 2008 to 2009. The boost in profit last year is largely due to higher electricity because of unusual weather and customers paying more because of a $75 million increase in base rates and charges for an expansion of its natural gas plant in western Palm Beach County, according to the utility. Florida's economy also appears to be improving, as evidenced by 28,000 more customers In the fourth quarter compared to the end of 2009. Still, FPL's fourth quarter profit was down slightly to $181 million, from $186 million the year before. NexdEra Energy Chairman Lew Hay said the company's performance continues to outpace those of its peers. He said the company did well "even though last year was one of the most challenging business environments [it has] ever had to face." He said the company's recent agreement with consumer advocates and others to freeze base rates provides stability to the company and its customers, and its focus on making its plants fuel-efficlento'help make a typical FPL bill the lowest in the state. Florida regulation Company leaders said they're hoping for a stable regulatory climate in Florida. The Public Service Commission's four newest members will be up for Senate approval during the legislative session that starts March 8. In what was considered an attitude shift, the PSC unanimously rejected its staffs proposal to monitor FPL's profits in case the company earns more than what's allowed and customers are owed a refund. FPL is allowed to earn a profit on shareholders' investment of 9 percent to 11 percent, and "we believe [it] will be at or near 11 percent in 2011 and 2012," Hay said. .sun-sentinel.com/.../sfl-fpl-nextera-profit-earnings-full-year-link-012511_1_nextera-energy-base-rat... 1/3 /11/12 FPL's profit was $945 million last year, up 14 percent - Sun Sentinel Find More Stories About Profit Base Rates Renewable energy Company leaders said they're hoping for state legislation this year to allow the FPL to charge customers for new solar plants. Similar legislation in 2008 allowed it to build solar plants that produce 110 megawatts of energy, enough to power more than 35,000 homes and business. Meanwhile, NextEra Energy, FPL's parent company, is the largest U.S. producer of wind and solar energy and it expanded its efforts in that area as well. NextEra Energy Resources, the company's unregulated alternative energy arm, invested $2.3 billion to build solar plants last year, including a 250- megawatt plant in California and a smaller project in Spain. It also entered into contracts to sell 1,238 megawatts of wind power including 553 megawatts for projects that will be completed this year or next. That's the largest amount of energy the company has struck agreements to self in one year. Renewable Energy Insights See Goldman Sachs' perspective on the Clean Technology market. goldrnansachs.com/clean-technology Steve Fleishman, a senior utilities analyst for Bank of America/Merrill Lynch, asked how that was possible and whether they're long-term contracts. Armando Pimentel, chief financial officer of NextEra Energy, said the energy was sold mainly in response to incentives in other states for utilities to buy renewable energy from other companies. "There's nothing nefarious about that number. They are all long-term contracts," he said. "We have been spending a whole heck of a lot of management time making sure we get some visibility on this." Profits for NextEra and Energy Resources NextEra Energy reported a 21 percent rise in net profit to $1.96 billion, or $4.74 per share, from $1.62 billion, or $3.97 per share, in 2009. That's despite the fact that its fourth quarter profit dipped 25 percent to $263 million, or $0.63 per share, from $349 million, or $0.85 per share, in 2009. Energy Resources reported a $980 million profit in 2010, up 30 percent from $759 million in 2009. Updated at 11 a.m. Wind Power Plants Siemens Answers for US Energy: Renewable energy technology leader. www.s i emens.com /wind -power Get 20% Off Auto Parts Buy Auto Parts & Car Accessories. Free Shipping For Orders Over $75. AdvanceAuloPans.com/Special-Otters Featured Articles 10 must -see places to visit in Florida MORE: 'Gator Boys' reality show Eight great South Florida captures state's attention snorkeling spots Low white blood cell count not always a sign of medical problem HGTV giving away Miami condo Low-cost cell phones for teens, seniors .sun-sentinel.com/.../sfl-fpl- nextera-profit-earnings- full-year-lin k-012511_1_nextera-energy- base -rat... $20 savings coupon at Festival Flea Market Lifeline program offers free cell phones with 250 minutes a month if you qualify Consumer index hints of lower COLA in 2013 for seniors Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk llora1T1hi 1)11110 (1i 1)1,1Cr iI IPI}•IOi n( I(11•: ar(dQ C 0* FPL rate increase likely Ik, Alr ..t d('r501i Muff writer lilbtishwL .tinturday. May 20, 2012 of Ise p. m. If Florida Power & Light gets its way, higher electricity rates are coming. Flush with profits, a rising stock price and escalating dividends, Florida's largest electric company wants to increase rates on 4.6 million customers next year and raise the cap on its profit margin. Under a request before state regulators, FPL would increase its base rate by 16 percent next year and boost its maximum profit margin from ti percent to 12.5 percent after taxes. FPL says the proposed increase will combat inflation, keep borrowing costs low, upgrade facilities and maintain a good return for investors. But roughly $20o million of the $690 million from the rate increase would be used to increase annual investor returns, a move strongly opposed by many consumer advocates, business groups and former utility regulators. Despite the opposition, the beating is that FPL will get its way this lime, unlike three years ago, when a more consumer friendly Public Service Commission largely •rejected the utility's request for a 31 percent base rate increase. Since then, the five -member panel charged with utility oversight in Florida has undergone a makeover, with four commissioners ousted by state lawmakers in a move viewed by many as retribution fur their strong stand against higher electricity rates. Since its last rate request was rejected, FPI, has successfully controlled expenses while earning an additional $231 million in profits — a 29 percent increase since 2009 that pushed FPL's profit to a record $1.07 billion last year — while the dividend and stock price of parent company NextEra Energy both grew by more than 25 percent. 'Good value proposition' Weighing in the company's favor is the fact that even after the rate increase, FPL would continue to have the lowest electricity rates in Florida. The average FPL customer paid $94.62 in January, compared with the statewide average of $i 26.oi. FPL's rate proposal would add $7.09 to the monthly bill of an average household that uses 1,000 kilowatt hours of electricity. "I think we're offering a pretty good value proposition to our customers," NextEra CEO Lew Hay said during the company's annual shareholder meeting on Friday, adding that the company also has a superior reliability rating and creates less air pollution than most elect ric utilities. If FPL's new base rate is approved, the average custoiner's total electric bill will increase by 7.5 percent overall because base rates only account for 40 percent of the Submitted into the public ww.heraldtribune.com/article/20120526/ART[CLE/120529662?template=printart record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk total bill, which also includes fuel charges, energy conservation and environmental programs_ FPL officials also point out that fuel prices are expected to drop next year. The average customer could end up paying just $1.41 a month in additional charges when fuel prices are factored in. But critics say those savings could quickly disappear because fuel prices are highly variable. They argue that base rates — which generate much of FPL's profit — should be considered separately from fuel. "They're really trying to put the best foot forward with this huge drop in fuel cost recovery masking the base rate increase," said Charles Milsted with AARP, which is closing tracking the rate case because of the potential impact on low-income seniors. Commission concerns The debate comes to Sarasota City Hall on Thursday when the PSC kicks off a series of public hearings. FPL serves 420,00o households and businesses in Sarasota and Manatee counties. Opponents of the rate hike ranging from the AARP to the Florida Retail Federation and the Florida Industrial Power Users Group plan to aggressively challenge FPL's bid for increased profits. But many consumer advocates are concerned that lawmakers have handpicked less aggressive PSC members who are unlikely to ask tough questions. When the four PSC members who voted against FPL's last rate request were not considered for reappointment in 2010 by the Legislature's Public Service Commission Nominating Council, "that sent a clear message to any succeeding commissioner that you do what the utilities say or go look for another job," said Bill Newton, with the Florida Consumer Action Network. "The PSC has been completely whittled away and intimidated," Newton said. "I fully expect them to be the lapdogs of the utilities." That sentiment is echoed by previous PSC members, including Nancy Argenziano, who spent 10 years as a Republican state legislator before former Gov. Charlie Crist appointed her to the utility regulation board in 2007. Aggressive and blunt, Argenziano picked apart FPL's rate request as chairwoman of the PSC in 2009. She lambasted company officials over expenses such as plane travel and lavish executive compensation, and was kicked off the commission by a nominating council headed by Sen. Mike Bennett, R-Bradenton. Argenziano accused the council and Bennett of doing the utilities' bidding, and singled out FPL as the main instigator for her dismissal. "The utilities pretty much own the Legislature, in my opinion," Argenziano said. "They donate an incredible amount of money to get what they want and the public is getting the shaft big time." Bennett denied any undue influence by utilities when lawmakers picked new PSC members. He said utility representatives "were not shy about saying they didn't like" Argenziano and fellow ousted commissioner Nathan Skop, "but that did not influence me. "Neither one of them was willing to negotiate," Bennett said. "They wouldn't play well with others. It was always their showboating, a very aggressive, in -your -face type of thing. Politics is the art of compromise." 'ww.heraldtribune.cam/article/20120526/ARTICLE/120529662?template= printart Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk Bennett said he hopes the current PSC "will have enough smarts, if you will, to look at the total package of what's best for the consumer, what's best for the people of the state of Florida." CEO pay a thorny topic Consumer advocates view the PSC's decision this year to award Gulf Power a $64.1 million rate hike — or about 63 percent of what the company sought — as a bad sign. FPL received just 6 percent of its $1.27 billion rate request when Argenziano chaired the PSC, while Progress Energy received about 28 percent of the company's $499 million request. Those rate requests were viewed by many as blatant overreach. FPL seems to have learned from the experience. Some of the flashier expenditures, including jet travel, have been removed from FPL's current request, although the issue of executive compensation continues to generate controversy. Activist shareholders questioned Hay's $13 million compensation package at the shareholder meeting in Juno Beach. FPL accounts for more than half of NextEra's net income. Tony Fransetta, president of the Florida Alliance for Retired Americans, called Hay's compensation "wrong." "You are making the money that you make on the backs of senior citizens," Fransetta said. The questioning became so testy that Hay declared the activists "out of order" and briefly adjourned the meeting while security guards removed chanting protestors .from the room NextEra's shareholders then voted to approve the company's executive salaries. Profit margin criticized The loudest criticism has been aimed at FPL's request to boost its maximum profit margin to 12.5 percent. The increased return to investors is estimated at roughly $200 million annually, although some critics say it could be closer to $250 million. FPL would not provide an official estimate. Florida Public Counsel J.R. Kelly, who represents utility customers in rate cases, said the profit margin is "totally unreasonable," considering the company is a regulated monopoly that offers a fairly secure investment with little risk. "We think it's ridiculous," Kelly said. "All you're doing is putting more burden on the backs of the ratepayers to fill the pockets of the shareholders. We don't think there's any justification whatsoever for that high of a return." Pam Rauch, FPL's vice president of development and external affairs, said the company's profit margin has been artificially pumped up by accounting maneuvers in recent years. FPL officials say their facilities and equipment are lasting longer than expected so they have been able to take some of the expected depreciation expense off their books, boosting profits. They say that "depreciation reserve surplus" will be used up by next year. ww.heraldtribune.com/article/20120526/ARIICLE/120529662?template=printart Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk "Everyone knew it was a temporary Band-Aid," Rauch said. Kelly said FPL basically overcharged customers for facilities and maintenance expenses and the depreciation issue should only factor into the current rate case if FPL can prove it will fall below a 9 percent profit margin — the bottom of the company's approved profit range of nine to i i percent — without the maneuver. "I don't want there to be a misunderstanding that if they're not earning exactly at the high point of their return range that they're somehow losing money or being penalized," Kelly said. There must be a balance between keeping rates down and ensuring a healthy utility, Rauch said. "I would submit that balance may have been a little bit out of kilter three years ago," she said. Rauch said that power plant upgrades included in the rate increase will cut fuel consumption and lead to lower costs for consumers over time. "Our customers are saving money because of what we're doing," Rauch said. "That's basically what the reason is for our rate request." FPL officials had said in 2009 that profit could drop to just 3.1 percent without a rate increase. Instead, the profit margin has consistently hit the it percent maximum currently allowed. Staff in the PSC office even suspected that FPL earned above its maximum profit last year, but commissioners declined to pursue the issue. FPL officials also argued in 2009 that investors would flee and the company would be stuck with increased borrowing costs without a rate hike. The company's credit rating dipped slightly in 2010, but Kelly said he can find no evidence that FPL is struggling to attract investors or borrow money. Most glaringly, FPL officials said the company would not be able to afford upgrades that are badly needed to maintain reliable and affordable service. The company's former CEO said immediately after the last rate request was rejected that he was suspending a series of major projects. Since then FPL has moved ahead with the largest spending in the company's history — investing roughly $3 billion annually, for an estimated total of more than $15 billion by 2oi4 — while simultaneously increasing profits. "There hasn't been this parade of horribles that was envisioned," said Jon Moyle, who represents industrial power users in Florida. Added Schef Wright, a lawyer representing the Florida Retail Federation, "The PSC said no and FPL has done great." Copyright © 2012 HeraldTribune.com — All rights reserved. Restricted use only. rww.heraldtribune.com/article/20120526/ARTICIE/120529662?template=printart Submitted into the public record in connection with item D4.1 on 10-11-12 Dwight S. Danie City Clerk