FERC approves sale of Vero Beach utility to FPL
Originally published October 9, 2013
Vero Beach, Fla., moved a step closer to selling its electric utility to Florida Power & Light Co. (FPL) with approval of the transaction by the Federal Energy Regulatory Commission. In an Oct. 7 order, the commission noted that FPL has agreed to hold its transmission and wholesale requirements customers harmless for five years and found that the transaction would not adversely affect the investor-owned utility’s wholesale requirements or transmission rates.
During that five-year period, FPL said it would not seek to include merger-related costs in its transmission service or wholesale requirements service revenue requirements, except to the extent it can demonstrate that merger-related savings equal or exceed the transaction-related costs.
FPL will pay a cash purchase price of $111.5 million for Vero Beach’s system. As part of the transaction, Vero Beach has entered into agreements with the Orlando Utility Commission providing that, at the same time that it closes the proposed sale, Vero Beach will: (1) terminate its existing wholesale power supply agreement with Orlando; (2) transfer Vero Beach’s Florida Gas Transmission Company gas transportation rights to Orlando; and (3) transfer all of Vero Beach’s Florida Municipal Power Agency (FMPA) power entitlements in the St. Lucie, Stanton I and Stanton II projects to Orlando. FPL will enter into a three-year power purchase agreement with Orlando to purchase 383 MW of capacity from the Stanton I and II projects.
Also as part of the sale, Vero Beach will give FPL a three-year lease to the site where the municipal utility’s generation is located, subject to a one-year extension, during which time the generation units must be retired and dismantled. The land is prime waterfront property, centrally located in Vero Beach along the intra-coastal waterway, FPL said.
The proposed sale still requires the approval of the Florida Public Service Commission and is not expected to close until 2014.
FPL owns approximately 27,000 MW of generating capacity in service or under construction and is a wholly owned owned subsidiary of NextEra Energy, Inc., which has nearly 5 million customers and over 42,000 MW of generating capacity in 26 states in the United States and four provinces in Canada.
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