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FPL Selects Sabal Trail Transmission And Florida Southeast Connection To Build New Natural Gas Pipeline System Into Florida

Stocks in this article: NEE SE

JUNO BEACH, Fla., July 26, 2013 /PRNewswire/ -- Florida Power & Light Company today announced that its evaluation of proposals for additional natural gas transportation capacity determined that the best, most economical solution for ensuring Florida's continued access to the clean, affordable, U.S.-produced fuel necessary to meet the growing electricity needs of the state's residents and businesses is a combination of a natural gas pipeline and interconnection hub to be built by Sabal Trail Transmission, LLC, and a second natural gas pipeline to be built by Florida Southeast Connection, LLC.

(Logo: http://photos.prnewswire.com/prnh/20120301/FL62738LOGO)(Logo:  http://photos.prnewswire.com/prnh/20130726/FL54138LOGO-a)(Logo:  http://photos.prnewswire.com/prnh/20130726/FL54138LOGO-b)

FPL's economic analysis showed that these projects will save FPL customers nearly $600 million compared with the next closest proposal.

Sabal Trail Transmission is a joint venture of Spectra Energy Corp (NYSE: SE) and NextEra Energy, Inc. (NYSE: NEE). Florida Southeast Connection is a wholly owned subsidiary of NextEra Energy.

Sabal Trail Transmission will invest roughly $3 billion in the construction of a new natural gas pipeline that will access the abundant reserves of various regions of the U.S. The Sabal Trail pipeline will originate in southwestern Alabama and transport natural gas to Georgia and Florida. It will terminate at a new Central Florida Hub south of Orlando, Fla., where it will interconnect with the two, existing natural gas pipelines that currently serve peninsular Florida. To connect with FPL's operations, Florida Southeast Connection will invest approximately $550 million to construct a separate pipeline from Sabal Trail's Central Florida Hub to FPL's Martin Clean Energy Center in Indiantown, Fla.

"At FPL, we have worked hard to reduce our dependence on foreign oil and to keep our customers' bills low. Since 2001, our investments in cleaner, more efficient, natural gas power plants have saved our customers more than $6 billion on fuel costs. To continue meeting the growing needs of our customers efficiently and reliably in the years ahead, we will need more natural gas than the two existing major pipelines can deliver, which makes a third, independently routed pipeline system absolutely essential," said FPL President Eric Silagy. "Natural gas is vital to the reliability and affordability of electricity in our state. Although Florida has essentially no natural gas reserves, many areas of our country have a wealth of supply. This project is not only about FPL and our customers – increasing access to clean, efficient, U.S.-produced natural gas will benefit the entire state."

Florida uses more natural gas to generate electricity than any U.S. state other than Texas, but it has minimal production, no storage capabilities and only two major pipeline systems available to transport natural gas to the peninsula. Both of these pipeline systems are approaching full capacity. However, Florida's economy is projected to require additional electricity – and, consequently, more natural gas – in the near future. To meet this need, the new pipeline system will be built to provide the state with additional natural gas transportation capacity beginning in May 2017.

FPL, the state's largest electric utility and largest natural gas user, will be an anchor customer for the new pipelines. Other users will also be able to contract for capacity and benefit from the increased access to abundant domestic natural gas reserves. The proposed route of the new system will maximize accessibility to all of Florida's major natural gas users and increase the overall reliability of the state's natural gas transportation network.

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