JUNO BEACH, FL—NextEra Energy, Inc. (NYSE:NEE) and its wholly owned subsidiary, Florida Power & Light Company (FPL), announced today their intent to file a base rate proceeding in early 2025. The announcement was made in a notification letter to the Florida Public Service Commission (FPSC) on Monday, indicating FPL's plan to submit a four-year rate plan beginning January 2026.
The planned rate proceeding follows the expiration of the current base rate settlement agreement established in 2022. With current revenues of $26.25 billion and an EBITDA of $14.58 billion in the last twelve months, FPL anticipates requesting an initial revenue requirement increase of approximately $1.55 billion effective January 2026, with an additional annual increase of about $930 million starting January 2027.
FPL's proposal will also include the introduction of a Solar and Battery Base Rate Adjustment (SoBRA) mechanism, which, pending FPSC review, would facilitate the recovery of costs associated with the construction and operation of new solar and battery projects planned for 2028 and 2029.
Moreover, the proposal is expected to suggest an allowed regulatory return on common equity midpoint of 11.9%, in line with the equity ratio approved in past base rate cases.
The formal request to initiate this base rate proceeding is projected to be filed by FPL on or around February 28, 2025.
NextEra Energy and FPL's forward-looking statements about the rate case filing are subject to various risks and uncertainties, including regulatory actions and economic conditions that could affect their operations and financial results. The companies caution that the statements are not guarantees of future performance and that actual results may differ materially from those projected.
The information shared in this announcement is based on a press release statement filed with the SEC. For investors seeking deeper insights, InvestingPro offers comprehensive analysis with additional ProTips and detailed metrics, including the company's Fair Value assessment and financial health scores. The Pro Research Report available on InvestingPro provides an in-depth analysis of NextEra Energy's market position and future prospects.
In other recent news, NextEra Energy has been making significant strides in its financial operations and renewable energy projects. The company has announced plans to initiate a base rate proceeding in 2025, aiming to replace the current base rate agreement set in 2022. In addition, it has successfully completed a sale of equity units totaling $1.5 billion, led by J.P. Morgan Securities LLC, Mizuho (NYSE:MFG) Securities USA LLC, and Goldman Sachs (NYSE:GS) & Co. LLC.
The sale of equity units will fund investments in energy and power projects, and the proceeds might also be used for repaying a portion of outstanding commercial paper obligations. Each equity unit includes a contract to purchase NextEra Energy common stock in the future and a 5% interest in a Series O Debenture due November 1, 2029.
NextEra Energy reported a 10% year-over-year growth in earnings per share, demonstrating a robust earnings performance. The company also added 3 gigawatts to its backlog, which now totals 11 gigawatts, and announced framework agreements with two Fortune 50 customers, indicating potential projects reaching up to 10.5 gigawatts by 2030.
Goldman Sachs has reaffirmed its confidence in NextEra Energy, increasing its 12-month price target. However, it should be noted that despite these positive developments, the company faced challenges such as significant impacts from Hurricanes Helene and Milton, and a decline in adjusted EBITDA for NextEra Energy Partners due to asset divestitures.
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