NEE Advances on Riviera Beach Plant (Revised)

Zacks

NextEra Energy Inc.’s (NEE) operating wing Florida Power & Light (“FPL”) Company announced the successful conclusion of a string of operational tests on the first natural gas-powered combustion turbine at its Riviera Beach Next Generation Clean Energy Center.

The preliminary testing phase commenced in late Sep 2013 and involved a range of assessments as well as running the combustion turbine at 25 megawatts (MW) of electricity. The high-tech Riviera Beach facility has three combustion turbines.

Development work at the facility is still underway and on completion will have a generating capacity of up to 1,250 MW which will adequately serve NextEra Energy’s 250,000 customers by the first half of 2014.

NextEra Energy is using the first combustion turbine to carry out a series of steam pipe-cleaning activities to prepare the facility’s piping for full operation. At the moment, testing on the second combustion turbine is proceeding with the third turbine set for testing in November.

NextEra Energy spent over $1 billion for the cutting-edge infrastructure of the Riviera Beach Center. The facility will generate power using 33% less fuel per megawatt-hour and will have lower emissions than the previous plant, demolished in 2011.

The Riviera Beach Center employs combined-cycle natural gas technology which will contribute to substantial net savings for NextEra Energy’s customers. The facility’s operational lifespan is projected to be 30 years.

The project is a part of NextEra Energy’s strategy to steadily minimize its reliance on fuel imports. It has reduced its foreign oil dependency by 98% and is gradually steering its investments to more fuel-efficient power plants.

These modernization efforts are directed towards providing almost 100% service reliability and offering attractive power rates than its peers in Florida. This move will certainly lead to customer retention as well as add more non-FPL customers. We note that the Florida market is gaining traction owing to a decline in housing inventories and an increase in construction activities.

In early 2013, its Cape Canaveral Next Generation Clean Energy Center came online and the company has already torn down its Port Everglades plant to build a new center to be open in 2016.

FPL is also expanding its transmission network to bring domestically sourced natural gas services to Florida by 2017. It is collaborating with Spectra Energy Corp. (SE) to build the Saba Trail Transmission line which will boost NextEra Energy’s gas-based infrastructure.

NextEra Energy’s focus on strengthening its natural gas operations will bode well for the company’s future growth objectives as the current pulse in the U.S. market is increasingly in favor of clean energy.

Currently, the company carries a Zacks Rank #3 (Hold). However, other well-placed operators include Zacks Ranked #2 (Buy) Cleco Corp. (CNL) and Ameren Corp. (AEE).

Disclaimer

We are reissuing this article to correct a mistake. The original article, issued Wednesday, October 23, 2013, erroneously mentioned FirstEnergy Corp. [FE] as being involved with this development. It was not and is not; the original article should no longer be relied upon.

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