But according to a recent analysis by Morgan Stanley Smith Barney, in its most recent quarter, the FPL Group had a return on equity that is 174.67% higher than industry average. In this context, what exactly does "a fair shake" mean? Olivera warned that if the rate increase doesn't go through that JOBS might be lost. What else was he going to say? What the Herald ought to do for its subscribers, rather than print the gloss of an editorial board meeting: provide a forensic analysis of Olivera and the spin doctors' claims relative to the company's financial performance. What are we, ratepayers, really paying for?
On another matter, citizens are taking the FPL black hole on information related to $20 billion in new nuclear reactors at Turkey Point directly to the public. Good for South Miami ... (please click, 'read more')
... rising above their "benevolent king", Mayor Horace Feliu, who accepted campaign contributions from FPL and represented in a public forum that the City of South Miami endorsed new overhead power transmission lines along the US 1 corridor when no such decision had been made by elected commissioners.
A public meeting will be held 10 Dec 2009, 7-9 pm, at South Miami City Hall, 6130 Sunset Drive, to hear local activists discuss FPL's proposed US 1 powerlines and South-Dade nuclear expansion. The format will allow for audience questions; hopefully members of the Herald editorial board will attend, too, to hear about concerns that Olivera didn't bring to the paper's offices on Thursday.
Knowledgeable speakers will present information on:
– New biomedical literature on health effects of powerlines on residents
– Turkey Point's history of safety violations and equipment malfunctions
– Risks of new reactors to our aquifers and Biscayne Bay
– Effects of new reactors on Everglades restoration
– Economics of nuclear power generation vs. renewable energy
– Citizen options
From Morgan Stanley Smith Barney:
6 comments:
No charm offensive here, just threats.
FPL CEO: Gas Pipeline, Nuclear Project Hinge On Rate Case
December 03, 2009: 05:01 PM ET
NEW YORK -(Dow Jones)- FPL Group Inc. (FPL) may decide against building a natural-gas pipeline and new nuclear reactors in Florida if the company doesn't get a favorable decision from state regulators on an electric-rate proposal, said Lew Hay, the company's chairman and chief executive, in an interview Thursday.
Florida's Public Service Commission, which oversees utilities in the state, was rocked by allegations earlier this year that two of its commissioners acted improperly by attending dinners and parties hosted by executives of the utilities the PSC regulates. Gov. Charlie Crist appointed two new commissioners to the PSC earlier this month after deciding not to reappoint the commissioners who had been accused of misconduct.
The upheaval has FPL executives concerned that Florida Power & Light, the company's utility subsidiary, won't get fair treatment from regulators. Florida Power & Light has asked to raise annual base rates by about $1.3 billion, or 30% . Base rates compensate utilities for investments in power plants, substations, wires and other equipment, along with setting their allowed rate of return.
"I think there is fair amount uncertainty about how the commission is going to act," Hay said.
He said a recommendation by commission staff earlier this week on a pending rate increase filed by Progress Energy Inc. (PGN) "wasn't terrible." The staff backed a revenue increase of $174 million compared to $500 million requested by Progress, which serves central Florida and the Gulf coast.
Yet staff recommendations in recent months have become less of a barometer for the commission's final decision. In October, the PSC, contrary to its staff's recommendation, voted to deny Florida Power & Light's proposal to build a new $ 1.5 billion underground natural-gas pipeline, arguing that the project wasn't the most cost-effective and reliable way to bring more gas to the state.
The utility hasn't decided whether it will submit a new pipeline proposal to regulators, Hay said.
The company's decision to build two new reactors at its Turkey Point nuclear power plant in south Florida will also hinge on Florida Power & Light's relationship with regulators, he said. FPL estimates the project will cost $17 billion to $20 billion.
"That's a lot of money to put into a state where the politics of the day determine how much you're going to earn on infrastructure investment," Hay said.
FPL shares closed down 32 cents, or 0.6%, at $53.00 Thursday.
-By Christine Buurma, Dow Jones Newswires; 212-416-2143; christine.buurma@ dowjones.com
Is there a link to the Morgan Stanley analysis, or should we just take your word for it?
I added to the bottom of the post, the material cited: it is not possible to link to the site.
The quote on recent analysis by Morgan Stanley Smith Barney as to the FPL return on equity. I believe this report is on FPL group. This information may confuse readers with “facts” that aren’t entirely correct. The rate case is on FPL the utility and its rate of return, NOT FPL Group who the analyst usually report on. This mix and max can provide confusing information on how FPL the utility is doing financially . Only the utility is regulated by the PSC.
exFPLer is probably right. The unregulated side of the company has grown to be as big as the utility part and is benefiting greatly from the national interest in renewable energy.
The gem within the utility rate increase is the request to jack up the rate of return from 10 to 12.5% if I'm not mistaken. That at a time when the average joe would count themselves lucky if their 401k isn't as underwater as their home values.
You don't see that mentioned in their ads do you?
Would the FPL group be enjoying these exborbiant returns without the contribution of FPL the utlity:
Return on Sales: +167.44% of the industry. On equity
+176.67%, on assets +165.44%. And if they assess
us $4,000 per home or more to build #6 and #7 and expand 37 year old #3 and #4, the $20 Billion will go into their base assets and they will be able to earn a return on assets that we paid for and should be held in a public trust. They should either be a utlity with
a guaranteed and monitored rate of return or a private business; it should not be both ways.
And what about the Gainesville model which fosters and helps finance home and business based
solar energy generation; where is the offer from FPL for this option?
Barry J White
CASE/Citizens Allied for Safe Energy, Inc.
TOWN HALL MEETING Dec 10 7-9
South Miami City Hall
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