NextEra Energy, Inc. · NYSE:NEE
NextEra Energy — Credit Suisse Global Energy Summit 2011
60 slides from NextEra Energy's conference presentation, Feb 8, 2011
Slide 1: Credit Suisse Global Energy Summit
Credit Suisse Global Energy Summit Armando Pimentel Executive Vice President and CFO February 8, 2011
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results Any statements made herein about future operating and/or financial results and/or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These f
Slide 3: Non-GAAP Financial Information
Non-GAAP Financial Information This presentation refers to adjusted earnings, which are not financial measurements prepared in accordance with GAAP. Adjusted earnings, as defined by NextEra Energy, represent net income before the mark-to-market effects of non-qualifying hedges and the net effect of
Slide 4: NextEra Energy is a premier U.S. power company comprised of three strong businesses
NextEra Energy is a premier U.S. power company comprised of three strong businesses • $22.8 B market capitalization(1) • 42,588 MW in operation • $53 B in total assets • One of the largest U.S. electric • Successful wholesale generator • Regulated utility in Texas utilities • U.S. leader in renewabl
Slide 5: Substantial and profitable growth while diversifying its asset base
NextEra Energy has realized substantial and profitable growth while diversifying its asset base Cumulative Adjusted EPS(1) Capital Deployed ($B) .5 % CAGR 7 $3.84 $4.05 $4.30 $34.7 $3.49 $28.9 $3.04 $22.8 $2.63 $2.41 $2.48 $2.49 $17.5 $14.4 $10.9 $6.4 $8.2 $3.4 2002 2003 2004 2005 2006 2007 2008 200
Slide 6: Focus on maximizing value of current assets generated significant shareholder returns
NextEra Energy’s focus on maximizing the value of current assets and strategically investing in new opportunities has generated significant returns for shareholders Key Success Factors • Leverage the significant scale, Operational scope, and skills of our current excellence Total Shareholder Return(
Slide 7: Dividends and dividend growth remain a core part of shareholder value
Dividends and dividend growth remain a core part of the overall value to shareholders Dividends Per Share(1) $2.00 C AGR: 7% $1.89 010 2002-2 $1.78 $1.64 $1.50 $1.42 $1.30 $1.16 $1.20 2002 2003 2004 2005 2006 2007 2008 2009 2010 (1) Annualized split-adjusted quarterly dividend; dividend declarations
Slide 8: Growth opportunities weighted toward regulated and long-term contracted
NextEra Energy’s growth opportunities are significant and weighted primarily toward regulated and long-term contracted opportunities NextEra Energy Growth Outlook • FPL has ~$10 - $11 billion of capital earmarked for deployment through 2014(1) – $6.5 billion of major generation and advanced metering
Slide 9: Business mix expected to shift to more regulated and contracted by 2014
NextEra Energy’s business mix is expected to shift to a more regulated and long-term contracted business by 2014 Adjusted EBITDA(1) Contributions from Regulated and Long-Term Contracted Operations 100% 80% 80% 74% 60% 40% 20% 0% 2010 2014E (1) Earnings Before Interest, Taxes, Depreciation and Amorti
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Slide 11: Florida Power & Light is one of the best utility franchises in the U.S.
Florida Power & Light is one of the best utility franchises in the U.S. Florida Power & Light(1) • One of the largest U.S. electric utilities • Vertically integrated, retail rate-regulated • 4.5 MM customer accounts • 23,722 MW in operation • $10.5 billion in operating revenues FPL Service Territory
Slide 12: 2010 settlement agreement provides balance and certainty
We believe our 2010 settlement agreement provides acceptable balance and certainty for our customers and our shareholders Base Rate Settlement Agreement • Retail base rates will remain effectively frozen through the end of 2012 • Cost recovery for West County unit 3 will be limited to the projected
Slide 13: FPL is in one of the largest development cycles in its history
FPL is in one of the largest development cycles in its history, the outcome of which will provide significant overall savings to its customers FPL’s Major Capital Projects Approx. Estimated Actual Size Fuel Est./Actual PSC In-Service COD (MW) Facility Name Type Cost ($B) Approved Recovery 2009 2009
Slide 14: Florida may consider new renewables legislation
Florida may consider new renewables legislation which is not reflected in our current plans Renewables Generation in Florida • Cost recovery on 110 MW of renewables generation authorized through legislation in 2008 – Recovery through the environmental clause – 110 MW of FPL solar projects were ultim
Slide 15: Earnings growth at FPL driven by an increasing rate base
Over the next couple of years, earnings growth at FPL will be driven by an increasing rate base… FPL: Rate Base (2009-2014E) $B $30.0 -2014: 8.5% CA GR 2009 $26.2 - $26.6 ted Estima $25.5 - $25.9 $25.0 $23.6 - $23.8 $21.0 - $21.2 $20.0 $19.1 $17.6 $15.0 $10.0 $5.0 $0.0 2009 2010 2011 E 2012 E 2013 E
Slide 16: Consistent retail regulatory return on equity
… and a consistent retail regulatory return on equity Retail Regulatory Return on Equity ROE 12.0% Up to Up to 11.0% 11.0% 11.0% 10.1% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2009 2010 2011E 2012 E The planned use of the surplus depreciation amortization should allow FPL to realize a retail regulatory ROE at
Slide 17: NextEra Energy Resources
NEXTera’ ENERGY & RESOURCES
Slide 18: Energy Resources has 18,866 MW across states and Canada
Energy Resources has 18,866 MW located across 26 states and Canada Energy Resources Portfolio(1) • Successful wholesale generator • U.S. leader in renewable generation • 4th largest wind energy owner in Canada • Physical assets in 26 states and Canada • 18,866 MW in operation • $4.6 billion in opera
Slide 19: Existing portfolio can be divided into six segments
Energy Resources’ existing portfolio can be divided into six segments Business Breakdown Today(1) Contracted Wind • 77 projects in 17 states and 3 Canadian provinces 6,589 MW • 14-year weighted average contract life Contracted Gas / • 1,550 MW primarily gas-fired, 1,580 MW gas/oil-fired, 1,454 MW nu
Slide 20: Significant investment opportunities and high quality development pipeline
Energy Resources has identified significant investment opportunities as well as a high quality pipeline of future development projects Energy Resources’ Key Drivers 2011-2014 • Successful execution on currently identified key major projects – Genesis and Spain solar projects • Investments in wind an
Slide 21: Genesis and Spain projects are key components of growth plan
Energy Resources’ Genesis and Spain projects are key components of the overall growth plan and the expansion of its solar strategy Energy Resources’ Key Drivers 2011-2014 • Successful execution on currently identified key major projects – Genesis and Spain solar projects • Investments in wind and so
Slide 22: Genesis solar project has approved long-term contract
Energy Resources’ Genesis solar project has an approved long-term contract and we began site work in January 2011 Genesis Solar Project • 250 MW solar-thermal trough (SEGS technology) • The long-term power purchase agreement with Pacific Gas & Electric has been approved by the California PUC • Secur
Slide 23: Spain solar thermal plants expand solar portfolio
Energy Resources’ Spain solar thermal plants represent the opportunity to expand our solar portfolio and earn attractive returns Spain Solar Projects • Spanish government approved projects in December 2009 under a Royal Decree law • Acceptable revisions to Royal Decree published in December 2010 • T
Slide 24: Additional development opportunities weighed carefully
Additional development opportunities will be weighed carefully based on our ability to secure long-term contracts at favorable terms Energy Resources’ Key Drivers 2011-2014 • Successful execution on currently identified key major projects – Genesis and Spain solar projects • Investments in wind and
Slide 25: Wind generation has been an important growth driver
Wind generation has been an important growth driver for Energy Resources Cumulative Wind Growth MW 9,000 8,298 8,000 7,544 R : 22% G 7,000 01 0 CA 6,375 2-2 6,000 2 00 5,077 5,000 4,016 4,000 3,192 3,000 2,719 2,758 2,000 1,745 1,000 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 25
Slide 26: Power demand drives interest in long-term power purchase agreements
In the near term, power demand is one of the most important drivers of our customers’ interest in signing long-term power purchase agreements % U.S. Demand and Electric Output Change Electric Output(1) MM Industrial Demand(2) MWh 6.0% 280 4.5% 3.9% 3.6% 3.7% 4.0% 2.5% 260 2.0% 16% 0.0% 240 Decli -2.
Slide 27: RPS targets and Ontario feed-in-tariff drive renewables demand
Over the next few years, states’ renewable portfolio standard targets and Ontario’s feed-in-tariff program will drive North American demand for renewables generation 2011-2015 Cumulative Demand (GW) Energy Resources’ development is focused in areas with high supply gaps 27
Slide 28: Repowering older facilities is an attractive opportunity
Repowering older and less efficient facilities represents an attractive opportunity to develop on proven sites and potentially extend contracts with existing counterparties Repowering Opportunities • Repowerings represent 300 to 400 MW of opportunities over 4 years • Older technologies can be replac
Slide 29: Planning to add 3,500-5,000 MW of new wind by 2014
Energy Resources is planning to add 3,500-5,000 MW of new wind assets by 2014, from a 2009 base Wind Growth Strategy Installed Wind Capacity • Add 3,500-5,000 MW by 2014, from a MW 2009 base 13,000 12,500 – $7 - $10 billion of new capital deployed – 754 MW added during 2010 11,000 New 11,000 Wind •
Slide 30: Secured 1,238 MW of new PPAs in 2010
Amid challenging market conditions, Energy Resources secured 1,238 MW of new power purchase agreements in 2010, including contracts for 553 MW expected to be placed in service in 2011/2012 PPAs Secured in 2010 MW 1,500 Project COD 1,238 MW 1,200 2011/ 553 900 2012 600 238 2010 300 347 2009 0 100 200
Slide 31: Growth in utility scale solar expected to accelerate
Growth in utility scale solar projects is expected to accelerate, driven primarily by state renewable portfolio standards Projected U.S. Utility Scale Solar Installations MW 5,000 4,600 4,000 % : 124 G R 2,300 4 CA 3,000 9-201 200 2,300 2,000 1,190 1,100 2,300 1,000 525 575 225 1,100 81 0 2009 2010
Slide 32: Solar energy presents another attractive growth opportunity
Solar energy presents another attractive growth opportunity for Energy Resources Solar Growth Strategy Energy Resources • NextEra Energy is the leading Installed Solar Capacity MW U.S. operator of solar thermal 800 750 and photovoltaic assets • Leveraging our leading position 600 in wind 550 New – S
Slide 33: Modestly grow customer supply, trading, and gas infrastructure
We plan to continue to modestly grow our customer supply, trading, and gas infrastructure businesses, all of which we believe provide incremental value to our generation assets NextEra Energy’s Key Drivers 2011-2014 • Successful execution on currently identified key major projects – Genesis and Spai
Slide 34: Customer supply and trading businesses bring incremental value
Energy Resources’ customer supply and trading businesses bring incremental value to the overall portfolio Customer Supply and Trading Businesses • Optimize our physical assets • Use our physical asset expertise and market knowledge to better inform our hedging and trading decisions • Leverage knowle
Slide 35: Gas infrastructure investments provide market intelligence and returns
Energy Resources’ investments in gas infrastructure provide important market intelligence and attractive returns Gas Infrastructure Shale Gas Production: Return on Investment Shale Gas Production Annual Cash Return on • Partnering with small independent Investment 4-5 Year Simple producers with limi
Slide 36: Lone Star Transmission
L@®NEStar _— NExTera’ ENERGY Z
Slide 37: Lone Star's CREZ line is a regulated growth opportunity
Successful development of Lone Star’s CREZ line represents a regulated growth opportunity outside of FPL Lone Star Transmission CREZ Line • In January 2009, Lone Star was selected by Texas PUC as a CREZ(1) transmission service provider – ~320 mile line – ~$800 million of rate base • Lone Star receiv
Slide 38: Transmission policy reform is underway
Key to meeting state renewable portfolio standards, transmission policy reform is underway FERC Transmission Policy • FERC is moving ahead to reform transmission policy – Ratemaking is directed at two principal barriers to the development of a clean energy grid: 1. Regional cost allocation 2. Region
Slide 39: Regions pursuing reforms ahead of the final FERC rule
Some regions are even pursuing reforms ahead of the final FERC rule, but in a manner consistent with FERC policy goals Recent Regional Transmission Plans • New MISO plan allows for “multi-value” transmission projects’ (MVPs) costs to be shared – FERC approved the MISO MVP proposal in December 2010 •
Slide 40: NextEra Energy
NEX Tera ENERGY &
Slide 41: Operational excellence and tight controls across all businesses
Operational excellence and tight controls are a hallmark of our operations across all businesses NextEra Energy Fossil FPL O&M per Retail kWh Equivalent Forced Outage Rate ¢/kWh % 2.40 10.00 2.21¢ 2.20 Industry Average 8.00 7.46% Industry 7.74% Average(2) 2.00 Good 1.80¢ 6.00 1.80 1.60 1.54¢ Industr
Slide 42: Can grow adjusted EPS by 5% to 7% per year through 2014
Considering both company and industry drivers, we believe we can grow adjusted EPS by an average of 5% to 7% per year through 2014 from a 2009 base NextEra Energy Adjusted EPS(1) $6.00 $5.68 R $5.50 7% CAG 5% - $5.00 $5.17 $4.50 $4.30 $4.05 $4.00 $3.50 $3.00 (1) (1) 2009 2010 2014 (1) See Appendix f
Slide 43: Solid growth opportunities and strong track record present value proposition
NextEra Energy’s solid growth opportunities and strong track record present an attractive value proposition NextEra Energy Value Proposition Earnings Growth and Dividend Yield • Solid growth opportunities at all three main businesses 14.0% • Business mix shifting to more 12.0% 10.7% regulated and lo
Slide 44: NextEra Energy
NEX Tera ENERGY &
Slide 45: Appendix
45 Appendix NExTera’ ENERGY Z
Slide 46: Reconciliation of GAAP to Adjusted Earnings per Share
NextEra Energy - Reconciliation of GAAP to Adjusted Earnings per Share Reconciliation of Adjusted Earnings Per Share to Earnings Per Share 2002 2003 2004 2005 2006 2007 2008 2009 2010 Earnings Per Share (assuming dilution) $1.38 $2.53 $2.48 $2.34 $3.23 $3.27 $4.07 $3.97 $4.74 Adjustments: Net unreal
Slide 47: Reconciliation of 2010 Adjusted EBITDA to EBITDA
Reconciliation of 2010 Adjusted Earnings Before Interest, Taxes Depreciation and Amortization (Adjusted EBITDA) to EBITDA (Full Year Ended December 31, 2010) GAAP Adjustments Adjusted (1) Net income $1,957 ($179) $1,778 Add back interest 979 0 979 (1) Add back income taxes 532 (116) 416 Add back dep
Slide 48: Cautionary Statement And Risk Factors
Cautionary Statement And Risk Factors That May Affect Future Results In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (Reform Act), NextEra Energy, Inc. (NextEra Energy) and Florida Power & Light Company (FPL) are hereby providing cautionary state
Slide 49: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) FPL is a regulated entity subject to the jurisdiction of the Florida Public Service Commission (FPSC) over a wide range of business activities, including, among other items, the retail rates charged to its customers, the
Slide 50: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) markets. NextEra Energy’s results of operations and growth prospects could be adversely affected as a result of future legislation or regulatory initiatives, including, but not limited to, those that reverse or restrict the
Slide 51: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) The nuclear generation facilities are subject to environmental, health and financial risks, such as risks relating to site storage of spent nuclear fuel, the disposition of spent nuclear fuel, emissions of tritium and oth
Slide 52: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) The operation and maintenance of power generation, transmission and distribution facilities involve significant risks that could adversely affect the results of operations and financial condition of NextEra Energy and FPL.
Slide 53: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy’s competitive energy business is subject to development and operating risks that could limit the revenue growth of this business and have other negative effects on NextEra Energy’s results of operations and f
Slide 54: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) In addition to federal financial incentives, NextEra Energy Resources relies on state incentives that support the sale of energy generated from renewable sources, such as state-adopted RPS which require electricity provid
Slide 55: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Disruptions, uncertainty or volatility in the credit and capital markets may negatively affect NextEra Energy’s and FPL’s ability to fund their liquidity and capital needs and to meet their growth objectives, and can also a
Slide 56: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy provides full energy and capacity requirement services, which include, for example, load-following services and various ancillary services, primarily to distribution utilities to satisfy all or a portion of
Slide 57: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy may be unable to meet its ongoing and future financial obligations and to pay dividends on its common stock if its subsidiaries are unable to pay upstream dividends or repay funds to NextEra Energy or if Next
Slide 58: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Energy’s and FPL’s operational systems and infrastructure is challenging. NextEra Energy’s and FPL’s operating systems and facilities may fail to operate properly or become disabled as a result of events that are within the
Slide 59: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) The businesses and results of operations of NextEra Energy and FPL could be negatively affected by the lack of a qualified workforce, work strikes or stoppages and increasing personnel costs. NextEra Energy and FPL may no
Slide 60: NextEra Energy
NEX Tera ENERGY &
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