February 2013, Vol. 68 No. 2
Newsline
Florida Power & Light Company issues request to build a third major natural gas pipeline to serve Florida
Over the past decade, Florida Power & Light Company (FPL) has reduced its use of oil by 98 percent by investing in new, highly efficient power plants that use clean, U.S.-produced natural gas as a fuel to produce electricity. In 2001, FPL used more than 40 million barrels of oil to power customers; in 2012, the company used less than one million barrels.
With the two existing major natural gas pipelines serving peninsular Florida nearing full capacity, the state needs new natural gas transportation infrastructure by 2017 to meet the growing need for natural gas power. A new major natural gas pipeline will also improve the reliability of the state’s critical fuel transportation system and expand the state’s access to onshore sources, helping reduce exposure to offshore sources in the Gulf of Mexico and supply interruptions caused by tropical weather.
Florida uses more natural gas for electricity than any U.S. state other than Texas, with about 60 percent of Floridians’ power generated by plants that burn natural gas. But, unlike Texas, Florida has minimal natural gas production, no storage capabilities and only two major pipelines to deliver the fuel necessary to power the peninsula’s residents and businesses.
The proposed new “Southeast Pipeline” will provide 400,000 MMBtu per day, or approximately 400 million cubic feet per day, of natural gas capacity for FPL beginning in 2017, increasing in capacity in future years. It will be composed of two segments:
• The “Florida Interstate Connection” and “Central Florida Hub” comprise the upstream pipeline project, which will originate at an existing hub in western Alabama, run east and then south, ending at a new hub to be built in Central Florida that will allow the new pipeline to interconnect with Florida’s existing pipeline systems.
• The “Florida Southeast Connection” is the downstream pipeline project, which will originate at the new Central Florida Hub and connect with FPL’s system in Martin County, FL.
Approximately four-fifths of the roughly 700-mile distance from western Alabama to FPL’s Martin County plant would be covered by the upstream Florida Interstate Connection segment with the other one-fifth covered by the downstream Florida Southeast Connection segment. Interested companies can bid on one or both of the segments. The specific routes will be selected and proposed by companies submitting bids. FPL will oversee a fair, competitive RFP evaluation process that will select the best option or options for FPL customers.
As part of the evaluation process, FPL plans to consider a self-build alternative for the downstream Florida Southeast Connection segment. The self-build alternative, if found to be in the best interest of FPL customers, would be owned and operated by a NextEra Energy Inc. company. No consideration is being given to an FPL self-build alternative for the upstream Florida Interstate Connection and Central Florida Hub portion. However, the cost to build a pipeline project of this size will be substantial, and the completion schedule is critical. To facilitate timely construction, NextEra Energy will be prepared to discuss financial involvement in support of a selected option. FPL customers would not provide funding nor see their bills impacted by this in any way.
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