NextEra Energy, Inc. · NYSE:NEE
NextEra Energy — Barclays CEO Energy-Power Conference 2011
48 slides from NextEra Energy's conference presentation, Sep 6, 2011
Slide 1: September Investor Presentation
September Investor Presentation Armando Pimentel Executive Vice President and CFO September 6-8, 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 • $23.7 B market capitalization(1) • 42,588 MW in operation • $53 B in total assets • One of the largest U.S. electric • Successful wholesale generator • Regulated utility in Texas utilities • U.S. leader in renewabl
Slide 5: NextEra Energy is well positioned to capitalize on today's market opportunities
NextEra Energy is well positioned to capitalize on today’s market opportunities Attractive Investment Opportunity • Visible growth opportunities at all three main businesses • Aligned with fundamental trends driving the industry – Low exposure to new environmental regulation • Underpinned by excelle
Slide 6: NextEra Energy has realized substantial and profitable growth while diversifying its asset base
NextEra Energy has realized substantial and profitable growth while diversifying its asset base North American Presence 2011E Adjusted EBITDA(1) Long-Term Contracted 27% FPL 49% Other 8% Hedged 17% Cumulative Capital Deployed ($B) Adjusted EPS(2) .5% $34.7 CAGR 7 $3.84 $4.05 $4.30 $28.9 $3.49 $22.8
Slide 7: Strategic focus on clean generation has resulted in one of the lowest emissions profiles
Our strategic focus on clean generation assets has resulted in one of the lowest emissions profiles among the nation’s top 50 power producers… NextEra Energy 2010 Fuel Mix SO2 Emissions Rates Hydro (MWh) (Lbs/MWh) 1.0% Solar 0.2% Nuclear 26.4% Wind Coal 11.9% 3.6% NextEra Natural Gas Energy Oil 54.2
Slide 8: Attractive upside given the continuing direction of U.S. environmental policy
…which provides attractive upside given the continuing direction of U.S. environmental policy Summary of EPA Rules Announced Coal Plant Retirements(1) (Cumulative MW 000s) EPA Rule Status 20.3 Cross-State Air Pollution Finalized Rule (CSAPR) 16.0 16.7 14.3 SO2 NAAQS Finalized 11.4 12.2 9.8 Toxins Ru
Slide 9: Growth opportunities are tangible and weighted toward regulated and long-term contracted
NextEra Energy’s growth opportunities are tangible and weighted primarily toward regulated and long-term contracted opportunities NextEra Energy Growth Outlook • FPL has ~$10 - $11 B of capital earmarked for deployment through 2014(1) – $5.8 B of major generation and advanced metering projects to be
Slide 10: Florida Power & Light is in the midst of the largest development cycle in its history
• Florida Power & Light is in the midst of the largest development cycle in its history • Estimated 8.7% annual rate base(1) growth from 2010 through 2014 10 1) Rate base includes retail and wholesale rate base, clause-related, and AFUDC projects
Slide 11: FPL's development program is the largest of all investor-owned utilities
Comprised of clean generation projects, FPL’s development program is the largest of all investor-owned utilities Investor-Owned Utilities – Capacity Under Development(1) MW 3,000 2,870 FPL 2,500 2,040 2,000 1,550 1,500 1,021 1,000 700 668 600 523 513 498 444 373 500 364 228 212 200 148 130 101 81 50
Slide 12: FPL's Major Capital Projects Through 2014
In fact, FPL is in the largest development cycle in its history, the outcome of which will provide significant overall savings to its customers FPL’s Major Capital Projects Through 2014 Approx. Estimated Actual Size Fuel Est./Actual PSC In-Service COD (MW) Facility Name Type Cost ($B) Approved Recov
Slide 13: New generation improves the system heat rate, saving customers fuel costs
FPL’s investments in new generation improve the system heat rate resulting in substantial fuel savings for customers… FPL’s Fossil System Average Heat Rate(1) 10,000 21% 9,635 effic ienc y impr ovem 9,000 ent 8,445 Btu per kWh 8,000 7,900 7,600 7,000 6,000 2001 2006 2011 2016 Actual Actual Projected
Slide 14: High quality service to our customers: reliability
…and high quality service to our customers… SAIDI: System Average (1) Interruption Duration Index Frequency of Interruptions Avg. # of Minutes Good Interruptions per customer 175 1.5 32 % Industry Average I mp r 150 ovem ent 125 100 1 FPL 75 50 25 0.5 03 04 05 06 07 08 09 10 03 04 05 06 07 08 09 10
Slide 15: Lowest typical electric bill in Florida
…while providing our customers with the lowest typical electric bill in Florida Florida Electric Utility Residential Bill Comparison For Rates Effective June 2011 $170 Residential Bill (1,000 kWh) Florida Average U.S. Average FPL $150 $127.03 $121.08 $96.64 $130 $110 $90 $70 $50 FPL’s typical reside
Slide 16: Additional investments at FPL will drive an increasing rate base
Over the next few years, additional investments in generation and infrastructure at FPL will drive an increasing rate base… FPL Rate Base (2010-2014E) $B 0 -2014: 8.7% $30.0 CA GR 201 ted $27.0 - $27.4 Estima $26.4 - $26.8 $25.0 $24.2 - $24.4 $21.7 - $21.9 $20.0 $19.5 $15.0 $10.0 $5.0 $0.0 2010 2011
Slide 17: Retail regulatory return on equity expected to remain constant
… while retail regulatory return on equity is expected to remain constant Retail Regulatory Return on Equity ROE At or near At or near 12.0% 11.0% 11.0% 11.0% 10.1% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2009 2010 2011E 2012E The planned use of the surplus depreciation amortization should allow FPL to reali
Slide 18: Energy Resources has a robust development backlog of contracted renewable projects
• Energy Resources has a robust development backlog of long-term contracted renewable projects 18
Slide 19: Substantial wind and solar investments planned for 2011 through 2014
Energy Resources has substantial wind and solar investments planned for 2011 through 2014 for which it has already secured long-term power purchase agreements Estimated Capital Expenditures for Projects with a PPA(1) $3,125 MM - $3,525 MM Solar $1,675 - $1,875 $1,825 MM - $2,225 MM Solar $600 - $800
Slide 20: Why Invest in Renewable Generation?
Long-term contracted renewable projects offer tangible growth opportunities with attractive returns Why Invest in Renewable Generation? • Attractive returns and visible cash flows with long-term contracts • Growth opportunities not linked to commodities cycle – Demand spurred by state RPS goals • In
Slide 21: Energy Resources is by far the largest owner of wind assets in the U.S.
Energy Resources is by far the largest owner of wind assets in the U.S., with almost twice as much capacity as the next competitor Energy Resources Wind Growth Cumulative Wind Growth Top U.S. Wind Developers / Owners (MW) (MW) 8,298 8,078 (1) % : 22 7,544 GR 0 CA 6,375 -201 02 20 5,077 4,301 4,016 3
Slide 22: Securing long-term contracts for wind energy creating a strong development backlog
Energy Resources continues to be successful securing long- term contracts for wind energy creating a strong development backlog through 2014 Wind Development Update Planned Wind Projects • In 2011 and 2012, Energy with Long-Term Contracts(1) Resources plans to add 1,400 to MW 2,000 MW of new wind ca
Slide 23: Backlog of new solar opportunities is significant
Energy Resources’ backlog of new solar opportunities is significant and is expected to contribute meaningfully to adjusted earnings starting in 2013 Solar Growth Plans – 2011-2015 Planned Solar Projects • 415 MW of already-contracted with Long-Term Contracts solar projects planned for in- MW service
Slide 24: Energy Resources existing assets are largely contracted and hedged for 2012
Energy Resources existing assets are largely contracted and hedged for 2012 2012 Equivalent Gross Margin Contributions(1) 2012 Portfolio Sensitivities • $1/MMBtu change in 30% natural gas ≈ 3-4 cents in Hedged Merchant adjusted EPS(3) Assets 57% (88% hedged) Long Term Contracted • 1% change in wind
Slide 25: Lone Star is a rate-regulated utility in Texas
• Lone Star is a rate-regulated utility in Texas representing approximately $800 MM of planned investments 25
Slide 26: Lone Star's CREZ line represents a significant regulated growth opportunity
Successful development of Lone Star’s CREZ line represents a significant regulated growth opportunity 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 • Received approval f
Slide 27: NEXTera
NEXTera ENERGY & Y_ Pl. era ENERGY 25 RESOURCES L@®NEStar Lah ENERGY & a 7
Slide 28: Strong adjusted earnings and dividend growth over the past decade
NextEra Energy has produced strong adjusted earnings and dividend growth over the past decade Adjusted Earnings and Dividends Growth History Adjusted Earnings Per Share(1) Dividends Per Share(2) $4.30 (3) 5 % $2.20 . GR7 $4.05 : 7.4 % $3.84 $2.00 0 CA AGR 1 C $1.89 2-20 $3.49 011 $1.78 0 2-2 20 0 $3
Slide 29: Solid growth opportunities present an attractive value proposition
NextEra Energy’s solid growth opportunities and strong track record present an attractive value proposition NextEra Energy Value Proposition • Strong organic growth prospects Comparative Earnings driving adjusted EPS growth of 5% - Growth and Dividend Yield 7% through 2014 from a 2011 base 14.0% – S
Slide 30: Appendix
30 Appendix NExTera’ ENERGY Z
Slide 31: Contracted assets expected to generate more than $2.2 billion in gross margin in 2012
Energy Resources’ contracted assets are expected to generate more than $2.2 billion in equivalent gross margin in 2012 Contracted Assets Financial Information(1) Expected(2) Equivalent % Gross Generation Gross Margin(3) Margin 2012 Contracted Assets MW MWh Range ($MM) Hedged (4) Midwest Wind 2,576 9
Slide 32: Estimated 2012 gross margin from hedged/merchant assets
Energy Resources’ estimated 2012 equivalent gross margin from hedged/merchant assets is substantially hedged Hedged/Merchant Assets Financial Information(1) Expected(2) Equivalent % Gross Generation Gross Margin(3) Margin 2012 Hedged/Merchant MW MWh Range ($MM) Hedged Texas Wind 1,709 5,206,167 $270
Slide 33: 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 34: 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 35: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy’s and FPL’s financial results could be negatively affected if they or their rate-regulated businesses are unable to recover, in a timely manner, certain costs, a return on certain assets or an appropriate ret
Slide 36: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy’s and FPL’s businesses are subject to risks associated with legislative and regulatory initiatives. NextEra Energy and FPL operate in a changing market environment influenced by various legislative and regu
Slide 37: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) create substantial additional costs in the form of taxes or emission allowances; make some of NextEra Energy’s and FPL’s electric generating units uneconomical to operate in the long term; require significant capital
Slide 38: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Terrorist threats and increased public scrutiny of nuclear generation facilities could result in increased nuclear licensing or compliance costs which are difficult or impossible to predict. NextEra Energy’s and FPL’s ope
Slide 39: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) inability to properly manage or mitigate known equipment defects throughout NextEra Energy’s and FPL’s generation fleets and transmission and distribution systems; use of new or unproven technology; and dependence on
Slide 40: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) A portion of NextEra Energy’s power generation facilities operate wholly or partially without long-term power purchase agreements. As a result, power from these facilities is sold on the spot market or on a short-term con
Slide 41: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy’s and FPL’s results of operations are affected by the growth in customer accounts and by customer usage, each of which directly influences the demand for electricity and the need for additional power genera
Slide 42: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Although NextEra Energy’s competitive energy subsidiaries have used non-recourse or limited-recourse, project-specific financing in the past, market conditions and other factors could adversely affect the future availabil
Slide 43: 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 44: 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 45: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy’s and FPL’s businesses are highly dependent on their ability to process and monitor, on a daily basis, a very large number of transactions, many of which are highly complex, and cross numerous and diverse m
Slide 46: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) The implementation of security guidelines and measures and maintenance of insurance, to the extent available, addressing such activities could increase costs. These types of events could materially adversely affect NextEr
Slide 47: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NextEra Energy and FPL are required to maintain decommissioning funds to satisfy their future obligations to decommission their nuclear power plants. In addition, NextEra Energy sponsors a qualified noncontributory define
Slide 48: NEX Tera
NEX Tera ENERGY &
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