July 29, 2013

FPL selects Sabal Trail Transmission and Florida Southeast Connection to build new natural gas pipeline system into Florida

July 29, 2013 Submitted Suwannee Democrat


Live Oak — Regulatory Reviews

In December 2012, FPL issued a request for proposals (RFP) for new natural gas transportation with an April 2013 deadline for responses. The RFP specified FPL's preference for a northern pipeline that would connect from Transco Station 85 in Alabama to a new market hub in central Florida and a second, southern pipeline that would connect from the hub to FPL's operations in southeastern Florida. Due to the substantial cost of building this new natural gas transportation system, the RFP also noted that NextEra Energy would be willing to consider financial involvement in support of a selected proposal to facilitate timely construction to meet the critical May 2017 in-service date.

Bids to construct the new northern and southern pipelines were submitted by a number of well-known, national pipeline companies. Through a competitive and thorough evaluation process, the utility's selection team analyzed all bids and determined that the Sabal Trail proposal for the northern project, and FPL affiliate Florida Southeast Connection's self-build alternative for the southern project, provided the greatest customer benefits at the lowest cost.

The obligations of Sabal Trail and Florida Southeast Connection to build and operate, and FPL's obligations to be an anchor customer of, the pipelines are subject to conditions set forth in precedent agreements executed by the parties.

Both Sabal Trail and Florida Southeast Connection will be interstate natural gas pipelines subject to Federal Energy Regulatory Commission approval and oversight.

In conjunction with today's public announcement, FPL filed a petition for prudence review with the Florida Public Service Commission (PSC). Subject to PSC approval, FPL's cost of using the new pipelines to deliver natural gas for its power plants will be factored into the fuel charge on customer bills beginning in 2017, consistent with how the company's costs of using the two existing pipeline systems are recovered.

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