Florida Power and Light’s footprint across Florida could be getting bigger, through a proposed deal in which its parent firm would buy Pensacola-based Gulf Power Company as part of a $6.5 billion package.
Jim Robo, Chairman and CEO of NextEra Energy, spoke with shareholders on Monday.
“NextEra has agreed to acquire Gulf Power; Florida City Gas, and ownerships stakes in the Oleander and Stanton natural as power plants,” Robo said in a conference call.
NextEra will acquire 100 percent of the Oleander plant near Cocoa, and 65 percent of Stanton near Orlando.
“The transactions expand NextEra’s energy’s regulated business operations through the addition of attractive electric and natural gas franchises,” Robo said. “Over time, the transactions will allow NextEra to extend its best-in-class proposition of low bills, clean energy, high reliability and outstanding customer service to the combined customers of Gulf Power and Florida City Gas.”
Already the largest electric utility in the state, FPL serves about five million residential and business customers. Gulf Power is the largest utility in the Panhandle, with roughly 460,000 customers in eight counties. Robo says that makes the purchase a good fit.
“In addition to roughly 9,500 miles of transmission and distribution lines, Gulf Power also owns a portfolio of nearly 2,300 megawatts of generation assets,” said Robo. “Florida City Gas provides natural gas distribution to its approximately 110,000 customers through 3,700 miles of pipeline that largely overlaps with FPL service territory.”
The transaction is subject to federal scrutiny. If approved, NextEra would finance it through issuance of new debt. The $6.5 billion dollar total would include $1.4 billion of Gulf Power debt.
Emails to the Southern Company in Atlanta requesting comment were not answered. If the deal goes through, NextEra CEO Jim Robo says Gulf Power would continue to operate as a separate electric company.
Almost immediately after the proposed sale was announced, watchdog groups began voicing concerns. Susan Glickman, Florida Director at the Southern Alliance for Clean Energy, says while the Public Service Commission regulates utility operations, the Legislature never gave them oversight when investor-owned utilities are put on the block.
“So there’s really no one looking out for the public’s interest here,” said Glickman. “And in a time when we need more competition, with all the new technology around energy issues, that one single monopoly would control so much of Florida’s utility/energy market.”
Another concern, says Glickman, is what she calls FPL’s “very tight grip” on the Statehouse; through contributions to candidates and political parties. She says that’s putting Florida behind other states when it comes to developing new projects.
“They have definitely thrown a lot of shade on Florida’s solar market,” Glickman said. “While the costs of solar are coming down, they have managed to create barriers for Florida families and businesses from putting up their own rooftop solar.”
With little if any state regulation over the sale, Susan Glickman with the Southern Alliance for Clean Energy says protesters need to go to Uncle Sam.
“The one place to weigh in is at the federal level,” Glickman said. “So I would contact your member of Congress and make sure that they’re aware about the sale, and what it would mean to the state of Florida to have so much power concentrated in one utility.”
Closure of the deal is expected to be in two parts. Florida City Gas purchase is slated for the third quarter of this year, while Gulf Power and the plants are expected to be finalized during the first half of 2019.