Florida Power & Light (FPL) on Jan. 26 said that before the end of 2016, it intends to build three new solar photovoltaic (PV) power plants that are being designed to cost-effectively complement other major system improvements, including the retirement of some of the company’s oldest fossil fuel-burning units.
“Over the past decade, we have continuously focused on advancing reliable, affordable, clean energy for our customers,” said Eric Silagy, president and CEO of FPL. “In particular, we have been working especially hard to find ways to advance solar energy in Floridawithout increasing electricity costs, and we have developed what we believe will be a cost-effective plan to triple the amount of solar energy we use to serve our customers before the end of 2016.”
Currently, solar power – even the most economical large-scale installation – is generally not yet cost effective in FPL’s service area, due in part to its higher costs compared to the company’s highly efficient system and low electric rates. However, FPL said it has identified three uniquely advantaged sites that will each facilitate the cost-effective development of a new, large-scale solar plant. In addition, as the cost of solar PV is projected to decline further later in the decade, FPL is optimistic that it could potentially add even more solar energy generation.
FPL operates a diverse portfolio of energy sources to power the state’s growing population and economy. As outlined previously in the company’s 10-Year Site Plan filed with the Florida Public Service Commission, FPL anticipates a significant need for additional firm power generation beginning in 2019, when its total number of customer accounts is projected to top 5 million. To meet this need, FPL intends to issue a Request for Proposals (RFP) during the first quarter of 2015. At this time, the company believes that clean, high-efficiency natural gas generation will likely be the most cost-effective energy source to meet this specific need.
Investments in high-efficiency natural gas generation since 2001 have enabled FPL to cut its use of foreign oil by more than 99% – from more than 40 million barrels of oil in 2001 to less than 1 million barrels annually today. The company has been strategically phasing out older, less efficient fossil fuel plants and replacing them with new, high-efficiency natural gas energy centers that use approximately one-third less fuel per megawatt-hour.
In addition to improvements in fossil fuel and renewable power, FPL successfully completed in 2013 the largest nuclear expansion in recent U.S. history – an investment that is now saving customers approximately $100m a year in fossil fuel costs without emitting any CO2 or other greenhouse gases.
“There’s no simple, silver-bullet solution to the complex challenge of planning to cost-effectively and reliably meet future energy needs. Energy issues involve long-term, fact-based planning and decision-making. FPL’s strategy of making smart investments in affordable, clean energy infrastructure is working. We take great pride in the fact that our electric rates have actually decreased in recent years, helping keep our typical residential customer bills the lowest in Florida and well below the national average, while we continue to deliver industry-leading reliability and invest in advancing a system that’s already one of the cleanest and most efficient in the country,” Silagy said.
FPL said its recent and ongoing power capacity development work includes:
- On Dec. 31, 2014, FPL retired two 1970s-era gas- and oil-fueled generating units in Putnam County (Putnam Plant Units 1 and 2).
- By the summer of 2015, the new Palm Beach County Solid Waste Authority (SWA) waste-to-energy plant is expected to enter service, doubling the site’s renewable energy capacity. FPL buys this renewable energy from SWA.
- Although large-scale solar PV remains the most economical way to utilize solar energy for FPL customers, the company also recognizes the role of distributed generation. In the coming months, FPL will build the first of several community-based solar installations as part of a pilot program that will be supported by the company and voluntary participation by customers. In addition, FPL continues to work on plans to install commercial-scale arrays at locations to be announced in the near future.
- In mid-2016, the new high-efficiency, natural gas-fueled FPL Port Everglades Next Generation Clean Energy Center is expected to enter service at the site of a former oil-fueled plant, which was dismantled in 2013. The project remains on schedule and on budget. This project is the third in a series of three major modernization investments. The first two projects, the FPL Cape Canaveral and Riviera Beach Next Generation Clean Energy Centers, entered service in 2013 and 2014, respectively – ahead of schedule and under budget.
- By the end of 2016, the company expects to add three new large-scale solar power plants. FPL estimates that it will be able to build these facilities cost-effectively due to several factors – in addition to the decreasing cost of solar PV – that include the sites’ key characteristics such as close proximity to existing power transmission lines and substations with adequate capacity for the additional generation.
- Clean, high-efficiency natural gas power continues to be the most likely option to meet the need for significant additional firm generation capacity beginning in 2019. To identify the best, most economical generation addition for customers, FPL will solicit proposals from interested outside parties and consider all qualifying bids in comparison with a potential new natural gas energy center that would be located on company-owned property in Okeechobee County.
- FPL continues to take a step-by-step approach to building two additional zero-emissions nuclear units at its existing Turkey Point site. Despite schedule changes announced by the U.S. Nuclear Regulatory Commission (NRC) in August and new timeline restrictions resulting from recent changes to Florida law, FPL said it continues to work toward bringing the units into service in advance of the 2030 deadline for the state to meet the EPA’s Clean Power Plan to reduce CO2 emissions from power plants.
- As the cost of solar PV continues to decrease, there is strong potential for several additional large-scale solar plants to be built cost-effectively in the next decade. FPL is analyzing potential sites in many parts of its service area.
Three solar power plants eyed in 2016
FPL has identified three sites with built-in advantages, such as the existence of sufficient transmission and substation infrastructure, which reduce the overall cost of building new solar plants. In the coming months, FPL intends to present detailed plans to the local communities identified as the most likely locations for new solar plants. The anticipated plants and sites are:
- FPL Citrus Solar Energy Center, DeSoto County, near Florida’s first large-scale solar plant, which FPL commissioned in 2009;
- FPL Babcock Ranch Solar Energy Center, Charlotte County, in coordination with and with the support of the county and the Babcock Ranch community; and
- FPL Manatee Solar Energy Center, Manatee County, on the site of an existing natural gas power plant that FPL operates.
Each of the new plants is being designed for roughly 74 MW of capacity. With support from the local communities, FPL would begin construction on the plants later this year and complete them by the end of 2016. These new plants, combined with community-based solar installations and other small-scale arrays that FPL is installing, would total more than 225 MW of new solar capacity. This would effectively triple FPL’s solar capacity, which currently totals approximately 110 MW.
FPL’s current solar portfolio includes: 75 MW at the hybrid FPL Martin Next Generation Clean Energy Center; the 25-MW FPL DeSoto Next Generation Solar Energy Center; and the 10-MW FPL Space Coast Next Generation Solar Energy Center near NASA’s Kennedy Space Center.
Gas and nuclear to get the lion’s share of the new capacity build
FPL projects a need for additional generation beginning in 2019. This projected need for new generation remains after accounting for all of the identified achievable potential conservation that is cost-effective. The current projection is that approximately 1,000 MW of firm capacity will still be needed beginning in mid-2019 due to several factors, including the retirement of older, inefficient plants and Florida’s growing economy and population. In order to identify the best, most economical generation addition for customers, all qualifying bids in the imminent RFP will be carefully considered in comparison with a potential new, FPL-operated natural gas-fired combined-cycle plant that would be located on company-owned property in Okeechobee County, Fla.
“U.S.-produced natural gas is critical to keeping our customers free from the past’s reliance on foreign oil,” said Silagy. “Clean, high-efficiency natural gas energy centers, along with cost-effective energy efficiency programs and zero-emissions nuclear and solar power, ensure FPL can continue to deliver clean, affordable and reliable electricity for customers 24 hours a day, 365 days a year, now and in the future.”
Over the past few years, FPL invested more than $3bn to successfully upgrade each of its nuclear units through one of the most complex nuclear projects in U.S. history. The new nuclear capacity added by the successful project is equivalent to a new medium-sized power plant. This investment, made possible because of Florida’s nuclear cost recovery system, is now saving FPL customers an estimated $100m a year on fuel.
FPL continues to make progress on the licensing of two new nuclear units at the company’s Turkey Point site. These units would generate enough clean energy 24 hours per day to power approximately 1.3 million homes for decades to come, saving FPL customers an estimated $170bn in fossil fuel costs and preventing approximately 418 million tons of carbon emissions over the initial operating life of the units.
In August 2014, the NRC announced a delay in its schedule for reviewing FPL’s previously submitted application for a combined operating license for the two new nuclear units, due largely to the agency’s resource constraints. This forces an extension of the project timeline by about two-and-a-half years. In addition, recent changes to Florida’s nuclear cost recovery law prevent certain work from being conducted until the NRC process is complete – causing an additional two-and-a-half year delay to the project timeline.
Despite this, FPL continues to expect that the new zero-emissions units will be built and producing power for its customers in advance of the state’s 2030 compliance deadline for the EPA’s pending carbon emissions reduction requirements, with the first unit projected to enter service in 2027 and the second to follow in 2028.
“Because we have lived and breathed our clean energy commitment for many years now, FPL is one of the cleanest electric generating companies in the U.S., positioning us well to meet the goals of the EPA’s Clean Power Plan,” Silagy said. “We are concerned that many other utilities and their customers may be facing potentially billions of dollars in compliance costs; however, we believe our customers will be protected from those potential rate impacts thanks to the affordable clean energy strategy we have been implementing with the support of the Florida PSC and other important stakeholders over the past 15 years.”
Florida Power & Light is the third-largest electric utility in the United States, serving more than 4.7 million customer accounts across nearly half of the state of Florida. FPL is a subsidiary of Juno Beach, Fla.-based NextEra Energy (NYSE: NEE).