FERC approves big Sabal Trail pipeline, which will supply power plants in Florida

Sabal Trail Transmission LLC, a joint venture of Spectra Energy Partners LP (NYSE: SEP), NextEra Energy (NYSE: NEE) and Duke Energy (NYSE: DUK), has received a certificate of public convenience and necessity from the Federal Energy Regulatory Commission to construct and operate its interstate natural gas pipeline project.

Spectra said in a Feb. 3 statement that this approval authorizes Sabal Trail, subject to certain conditions, to proceed with final preparations to commence construction in the coming months to meet a May 1, 2017, in-service date. Once complete, the 516-mile pipeline would have the capacity to deliver approximately 1.1 billion cubic feet of natural gas per day to the Southeast U.S., including firm transportation services to NextEra subsidiary Florida Power & Light and Duke Energy subsidiary Duke Energy Florida.

“Sabal Trail will provide a critically-needed source of domestic, clean-burning, affordable natural gas to the Southeast U.S. to meet the growing demand for natural gas-fired generation, the cleanest and most versatile fuel for powering the region’s homes and businesses,” said Bill Yardley, president of Sabal Trail Management, LLC and president of U.S. Transmission and Storage, Spectra Energy.

He added: “For more than two and a half years, Sabal Trail has engaged with stakeholders, local community officials, and federal and state agencies to locate and design a pipeline system that will be built and operated safely and efficiently. Receiving this stamp of approval is a testament to our strong history of consultation and successful project execution. We are very pleased to reach this significant milestone and move one step closer to construction of the pipeline, which will diversify the region’s energy sources and generate significant economic benefits for local communities.”

Also on Feb. 3, Florida Southeast Connection LLC, a wholly owned subsidiary of NextEra Energy, announced that it has received a Certificate of Public Need and Necessity from FERC to construct and operate a proposed underground pipeline to transport natural gas to southern Florida. The approval provides the company with authorization, subject to certain conditions, to prepare for construction, which is expected to begin this spring.

“This is a major milestone for an important infrastructure project that will help meet the growing energy needs of South Floridians for generations to come,” said Michael DeBock, executive director of gas infrastructure for NextEra Energy.

The estimated $550 million Florida Southeast Connection pipeline would interconnect with the two existing systems in Central Florida and the new interstate pipeline expected to be built and operated by Sabal Trail Transmission. The Sabal Trail pipeline would originate in Alabama to access the abundant natural gas reserves in various regions of the U.S. It would terminate at a new Central Florida Hub south of Orlando, Fla.

The Florida Southeast Connection pipeline route originates in Osceola County and runs 126 miles south and east, terminating at the FPL Martin Clean Energy Center in Indiantown, Fla. The company expects FERC to issue a Notice to Proceed with Construction this spring. Construction of the underground pipeline and associated facilities is expected to take approximately one year. It is scheduled to enter service in 2017.

NextEra noted that Florida is currently served by only two major pipeline systems, and both are nearing full capacity. The new pipeline would help enable power generators such as Florida Power & Light to continue to access America’s abundant supply of clean natural gas to power Florida homes and businesses. In addition, natural gas is also vital for local gas distribution companies that serve industrial, commercial and residential customers throughout the Sunshine State. 

Spectra Energy Partners is a Houston-based master limited partnership, formed by Spectra Energy Corp. (NYSE: SE). It is one of the largest pipeline MLPs in the United States and connects growing supply areas to high-demand markets for natural gas and crude oil. These assets include more than 15,000 miles of transmission and gathering pipelines, approximately 170 billion cubic feet of natural gas storage, and approximately 4.8 million barrels of crude oil storage.

NextEra Energy has approximately 46,300 MW of generating capacity, which includes megawatts associated with noncontrolling interests related to NextEra Energy Partners LP (NYSE: NEP). Headquartered in Juno Beach, Fla., NextEra Energy’s principal subsidiaries are Florida Power & Light, which serves more than 4.8 million customer accounts in Florida and is one of the largest rate-regulated electric utilities in the United States, and NextEra Energy Resources LLC, which, together with its affiliated entities, is the world’s largest generator of renewable energy from the wind and sun.

Duke Energy is the largest electric power holding company in the United States. Its regulated utility operations serve approximately 7.3 million electric customers located in six states in the Southeast and Midwest, representing a population of approximately 23 million people.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.