FPL Group, a major Florida electric utility, has taken the early lead in developing renewable power. Seems the gators and crocs (as in critters, not shoes) aren’t the only things green in Florida.
FPL primarily serves residential and commercial customers located on the lower west (Gulf) coast and industrial customers on the east coast of Florida.
FPL’s stock trades on the New York Stock Exchange under the ticker symbol “FPL.” Part II will discuss FPL from an investment standpoint.
Winning in Wind Power
FPL is the largest US wind-power generator.
Wind power provides about 30% of Florida Power & Light’s, the company’s power generation subsidiary, total power output. FPL has 48 wind farms across 16 states.
Additionally, earlier this year the company announced plans for a huge $20 billion expansion that will triple its wind capacity.
Starting to Soar in Solar
FPL has interests in seven solar thermal facilities in California’s Mojave Desert with a combined power generation capacity of 300 megawatts (MW). FPL’s overall share is about 50% — or 150 MW.
Solar thermal – sometimes called “Big Solar” – involves sunlight being reflected from a trough (or mirrors) to heat a water pipe, creating steam that drives a traditional turbine.
FPL announced in September that it will invest $1.5 billion to expand its solar power operations. It plans to expand the California operations by another 200 MW and build a 10 MW pilot facility in Florida, which could be expanded to 300 MW if it proves successful. It has also started the permitting process for 600 MW of new solar generation.
Ausra Inc. will design and supply the equipment for FPL’s new solar plants. Ausra claims that its large-scaled plants will be able to produce power at a cost level on par with natural gas-fired plants. The proof will be in the…power per kilowatt.
Check out my post on Ausra for more info about Ausra as well as the solar thermal process.
Why Wind has Breezed Past Solar at the Utility Level
At the utility level, the action in renewable energy has so far focused on wind power.
Why? Simple economics. Wind has been cheaper to build and enjoys the US federal production tax credit (while solar does not — crazy, huh?)
FPL believes, however, that it can now develop solar power profitably, even without the federal production tax credit. Stay tuned because if this turns out to be so, there will be Big Money to be made in Big Solar.
Here are some utility-level solar stats:
- As of 2005, there was only 411 MW of solar power capacity connected to the US power grid, compared with 8,706 MW of wind power.
- Just 13 facilities produce utility-scale solar power, 11 in CA and two in AZ.
- Net solar power generation from utility-scale facilities (defined as more than 1 MW of capacity) accounted for just 0.01% of all renewable energy in 2006, according to the US Department of Energy.
See you in awhile crocodile…as I’ll be back with Part II, which examines FPL from an investment standpoint.
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