* First phase of pipeline could enter service in 2017
* Pipeline to run from Alabama to central Florida
* FPL sees three new Florida power plants on by 2016
By Scott DiSavino
Jan 29 U.S. power company NextEra Energy Inc
is seeking proposals to build a natural gas pipeline to
serve the growing demand for the fuel in Florida, its chief
financial officer said on Tuesday.
"As customer demand grows and fleets across the state shift
to more natural gas-fired generation, Florida's natural gas
needs will increase significantly," NextEra CFO Moray Dewhurst
told analysts on a conference call following the release of
In December, NextEra's Florida Power and Light (FPL) unit
issued a request for proposals (RFP) for a third major gas
pipeline to serve Florida.
The proposed "Southeast Pipeline" will provide 400,000
million British thermal units (mmBtu) per day of gas capacity
for Florida beginning in 2017, and an additional 200,000 mmBtu
per day beginning in May 2020, Dewhurst said.
He said the pipeline will consist of two segments and run
about 700 miles in total.
The first, or upstream portion, will run from western
Alabama to a new hub in Central Florida that will interconnect
with all major existing Florida pipelines.
"This portion will access the abundant onshore natural gas
resources, helping reduce reliance on off-shore resources which
can be disrupted by tropical weather," Dewhurst said.
The second, or downstream segment, will run from the Central
Florida hub to connect with FPL's giant Martin County oil/gas
Dewhurst said the company had not yet determined total
capital expenditures for the pipeline project, noting the routes
will be selected and proposed by companies submitting bids.
As part of the process, Dewhurst said NextEra expects to
offer a self-build option for the downstream portion and is
prepared to consider investing in support of the selected
upstream option to help speed things up.
He said the company expects to begin evaluating proposals
during the second quarter of 2013, with construction expected to
be completed in 2017.
NextEra has said Florida uses more gas for electricity than
any U.S. state other than Texas, with about 60 percent of power
generated by plants that burn natural gas.
But unlike Texas, Florida has minimal gas production, no
storage capabilities and only two major pipelines to deliver the
fuel that powers the peninsula.
The company said building a pipeline will generate thousands
of jobs during construction and millions of dollars in new tax
revenue for local schools and governments.
In 2012, Dewhurst said FPL's fossil fuel fleet reached a
record level of efficiency, bringing the system-wide heat rate
down to 7,669 British thermal units (BTU) per kilowatt hour, or
roughly 24 percent better than the industry average of 10,040
BTUs per kilowatt hour.
In 2012, he said the company invested more than $4 billion
at FPL with more than $830 million of this associated with the
modernization of three old oil and gas-fired power plants in
Florida into efficient combined cycle gas plants.
The Cape Canaveral project is currently on schedule and
under budget, with an expected in-service date of June 2013.
The Riviera Beach modernization is also on time and on
budget, with an expected in-service state of June 2014, he said.
FPL expects the modernized Port Everglades plant to enter
service in June 2016, with demolition of the existing plant
planned for the second quarter of this year, he said.
On the nuclear front, he said FPL has completed three of
four planned extended power upgrades, investing roughly $3
billion to date and adding about 395 MW of clean, emissions-free
energy to the fleet.
The final upgrade at Turkey Point 4 is expected to come
online in the spring of 2013 and add about 120 MW of capacity,