Summary
NEXTERA ENERGY INC (NEE), through its subsidiary FPL Energy Duane Arnold, LLC, announced the acquisition of a 70% majority interest in the Duane Arnold Energy Center, a 592 megawatt nuclear power plant, for approximately $373 million. This strategic acquisition positions NEE to expand its nuclear generation portfolio. Importantly, the power generated from NEE's share of the plant will be sold under a long-term contract to the seller, Interstate Power and Light Company (IP&L), ensuring predictable revenue streams through early 2014. The agreement also includes the transfer of nuclear fuel, inventory, and decommissioning funds, with NEE assuming operational responsibility and future decommissioning obligations. The company also intends to seek a 20-year license extension for the plant in 2009, signaling a long-term commitment to this asset.
Key Highlights
- 1FPL Energy Duane Arnold, LLC (a subsidiary of FPL Group/NEE) acquired a 70% interest in the Duane Arnold Energy Center nuclear power plant.
- 2The acquisition cost was approximately $373 million, including nuclear fuel and inventory.
- 3All power from NEE's share of the plant is contracted to be sold to IP&L through early 2014.
- 4The power purchase agreement has escalating prices, starting at approximately $46/MWh in 2006 and reaching $61/MWh by 2014.
- 5NEE received approximately $188 million in decommissioning funds at closing.
- 6NEE will manage and operate the plant and is responsible for its future decommissioning.
- 7NEE plans to file for a 20-year license extension in 2009 to extend the plant's operation beyond 2014.