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Gulf Power To Be Sold In Multi-Billion Dollar Deal
May 21, 2018
In a major move in the state’s utility industry, the parent company of Florida Power & Light said Monday it will buy Northwest Florida’s Gulf Power as part of a $6.475 billion deal.
NextEra Energy Inc. plans to buy Gulf Power, the Florida City Gas natural-gas company and ownership interests in two power plants from The Southern Company. The purchase of Gulf Power and the stakes in the power plants, which are subject to federal approval, are expected to close during the first half of 2019, while the Florida City Gas purchase is slated for the third quarter of 2018, according to a NextEra Energy announcement.
The deal would expand NextEra Energy’s already-massive footprint in the state. Its Florida Power & Light subsidiary is by far the largest electric utility in Florida, serving nearly 5 million customers. Gulf Power, with about 450,000 customers in eight counties, is the largest utility in the Panhandle.
Florida City Gas has about 110,000 residential and commercial natural-gas customers in Miami-Dade, Brevard, St. Lucie and Indian River counties. NextEra said it will buy a 100 percent ownership interest in a power plant near Cocoa known as Plant Oleander, which has contracts to sell electricity to the Florida Municipal Power Agency and Seminole Electric Cooperative. It also will buy a 65 percent stake in a plant near Orlando known as the Stanton Energy Center, which has contracts with the Orlando Utilities Commission and the Florida Municipal Power Agency.
“These transactions will provide meaningful benefits for the state of Florida, and Gulf Power and Florida City Gas customers, as well as NextEra Energy shareholders,” Jim Robo, chairman and chief executive officer of NextEra Energy, said in a prepared statement. “Importantly, these transactions are consistent with our long-standing, disciplined approach of maintaining the strength of our balance sheet and credit ratings, both of which are among the strongest in the industry.”
NextEra Energy plans to finance the deal through the issuance of new debt, according to the announcement. The $6.475 billion total includes NextEra Energy assuming $1.4 billion of Gulf Power debt.
Subsidiaries of The Southern Company, which is based in Atlanta, operate in numerous states. In addition to Gulf Power, the subsidiaries include Alabama Power, Georgia Power and Mississippi Power. The Florida Public Service Commission last year approved a settlement agreement that set base rates for Gulf Power.
In the announcement, NextEra Energy said that with the addition of Gulf Power, Florida City Gas and the power plants, the Juno Beach-based company “will be even better positioned to generate long-term shareholder value through a more robust financial profile, greater scale and an expanded platform for growth.”
by Jim Saunders The News Service of Florida
Comments
43 Responses to “Gulf Power To Be Sold In Multi-Billion Dollar Deal”
I knew when they spent millions on those scrubbers it would be the closure to the plant. Mating coal particles smaller by scrubbing them only makes the particles smaller and deposit in the lungs deeper than if they were bigger, The company that sells those scrubbers is about out of business. Told a employee relative that coal powered plants would be gone soon, not 20 years. This is not 1920
“tell SoCo & GlfPwr WE SAY NO~!!!”
let’s organize this grassroots thing NOW, while we’ve got SOME time to try & influence our OWN DESTINY…
I await the consensus of the readers of NorthEscambia.com.
deep background, as they used to say:
“With a briefcase full of papers, Jacob F. Horton, the senior vice president of the Gulf Power Company, took off for Atlanta in a corporate jet here in April to talk with corporate officials about possible theft, payoffs and cover-ups that are under investigation by a Federal grand jury.”
https://www.nytimes.com/1989/06/18/us/florida-mystery-is-fueled-by-intrigues-and-4-deaths.html
……and there was the mysterious plane crash in Ferry Pass involving some GP movers and shakers going to Atlanta to answer to some type of problem.
Just say No!
Speaking of business dealings of Gulf Power, remember the land that was sold to county which resulted in WD going to jail as I recall which the county sold for 2.9M in 2003? Why did Gulf Power say they needed it in 2006 paying 15M? That 15M is a capital expense we all pay 15% on or am I wrong? Lots of questionable decisions and dealings. Lets allow competition.
When Gulf Power moved its Pensacola HQ to bayfront they spent 30M heavy handing folks to sell who didn’t want to and killing several small businesses in area all because they wanted the prime Bayfront location for their executives. How and why did a public utility do this? Was it because they are guaranteed a 15% profit on capital investment? Do you remember the Horton and WD days, the alleged Coal deals and suspicious goings on? The plan crash where Horton died where they found a jar of flammable liquid in passenger seat? Gulf Power has manipulated the area’s business under the banner of being the good neighbor. Glad there maybe a change we could use it. Deregulation needs to happen and customers need competition in the energy market. The big apple is the coal fired plant, great for cost, not so for environment or its neighbors, what is fly ash?
I saw this coming with all the changes. Hopefully we won’t see a huge increase.
Comparitevly speaking our rates are competitive…..we wouldn’t want to pay
what Hawaiians are faced with but would enjoy the low rates in say Washington
State. Course Washington State has lots of Hydroelectric ( Dams ) which are
The cheapest and cleanest way to make electricity. In our case TAXES and FEES
add way too much to our power bill not to mention surge protection which is $11.50
extra per month.in my case. ( lightning strikes ). Newer TV’s and LED lighting can
help reduce usage as well as turn-down electric water heater’s temp target. Going
conservative in electric,water,gas,telecommunications etc. can make a difference
in monthly costs. Gulf Power has really been a “good neighbor “ and usually is
very quick to respond to outages of any kind . I will say Gulf Power’s rates
could and should be lower and surge protection shouldn’t be an extra charge !
I’d have to say if it didn’t rain almost every day in Washington State I’d sure
consider a change of menu !!
Ya’ll act like you think Southern Company is a saint.
They’re doing good for their shareholders.
And what? They never raised rates right….
it is ok because my $7 a month raise in my ss check will more than cover the coming increases in my electric bill. eventhough i already used it three times to pay for other increases in my other necessary bills, they will not do us wrong.
we have no say in it just gotta do what the man {RICH} wants,
So a company that is cash poor and has to sell off a bunch of assets to create a better cash flow is somehow a better option for the consumers?? Southern Company is in need of cash and keeping them as your provider doesn’t seem to be the best option. And the PSC approves any and ALL rate increases. A company with cash is always a better option than one who is cash needy!!
FPL has been closing their coal fired plants. Recently closed JEA St. John’s River Power Park in Jacksonville, FL. It was a joint venture between FPL and JEA (FPL bought into JEA). 632,000 KW gone. The Crist Plant in Pensacola will most likely be closed in the near future. Lost jobs and lost local economy in our future.
https://www.jea.com/about/electric_systems/electric_facilities/st__johns_river_power_park/
I wondet if this has anything to do with the new work going on at their properyy on roach road…
This is GREAT NEWS! SO LONG GULP!!!!!!
@Jerry… the rates were lowered with the billing cycle that started with the March billing. The energy/fuel rates were 12.090 cents per KWH and are currently billed at 10.880 cents per KWH.
The Bloomberg report offers additional insights as to how Southern Company was put in to the position of needing to sell assets. to raise. The article also notes that Southern Company isnt done with selling assets to raise capital. You can find the article at this link:
https://www.bloomberg.com/news/articles/2018-05-21/nextera-to-buy-southern-co-florida-utilities-for-5-1-billion?utm_source=yahoo&utm_medium=bd&utm_campaign=headline&cmpId=yhoo.headline&yptr=yahoo
We just thought our light bill was high. Get ready.
The question is why is Southern Co. willing to sell off Gulf Power. While there is a large debt load –this is not out of line with most companies. Maybe they will build some sort of power plant on the Escambia River property as some one said.
What happened to the rate reduction from Gulf Power that we were supost to get in February. I watch my consumption daily and kilowatt usage from last year to this year remain the smae, but my bill is higher. They said fuel cost were down and we should see $10 for every 1,000KW that we used. I ain’t seen a penny yet.Hopefully it will be retroactive. HA! HA!
How will this affect retirees? My husband worked for Gulf Power for 30 years and we have supplemental insurance to Medicare through Gulf Power as well as dental insurance and life insurance. This is very concerning!
This buyout has nothing to do with what is best for the customer. As others have pointed out, ultimately it will mean higher rates, less service, and a better balance sheet for the new owner.
The $1.4 billion debt says it all. No company will absorb that kind of debt without having a plan to get it all back. Bend over and brace yourselves because they will stick it to us as soon as they take control.
So now the REAL reason Gulf Power fought hard to put the federal money back into the company to decrease rates. They obviously have been in discussions for quite some time and being able to dump the federal money back into the company was more self-serving than to help its customers. I agree, just like insurance rates, our territory will have to take the hit to pay for damage from storms elsewhere. I think it may be time to go solar or go to a energy cube.
This is not a good idea. Watch our rates skyrocket As they were quoted this benefits the State of Florida and the shareholders. Not the consumer
I noticed that there was not a mention of the sale benefitting the present Gulf Power users. Quote, “These transactions will provide meaningful benefits for the state of Florida, and Gulf Power and Florida City Gas customers, as well as NextEra Energy shareholders,” Jim Robo,chairman and chief executive officer of NextEra Energy, said in a prepared statement. “Importantly, these transactions are consistent with our long-standing, disciplined approach of maintaining the strength of our balance sheet and credit ratings, both of which are among the strongest in the industry.” What about the customers of Gulf Power ?
Makes “little house on the praire” look like easy livin’!
Gulf power is bailing on the futer power upgrades required to power the panhandle. Most of electrical infrastructure is out dated and under sized. It require billions for GP to bring it capable of handling the future.
Angie is so right. Like ins co’s blaming all of us for the few that insist on doing careless driving. I try to conserve energy and the neighbor runs air conditioning with his windows open! What’s the use?
JUST NO ! ! !
This news came as a surprise. I am hoping for the best for the employees involved, friends, and former co-workers.
So this is waiting for federal approval? Contact your representatives and tell them NO. I never like when a monopoly is created, And that’s exactly what this is. one company should not be a be to have that much control over the state of Florida. The bigger they get, the worse the customer service and the pricing gets.
FP&L likes nuclear power plants so maybe they will build one here on the land GP bought in McDavid. Good jobs and clean power are a good thing.
Sadly this means higher rates for them to line the pockets of shareholders and a huge drop in customer service….This is not good for the panhandle…..
Definitely not a good move for us, the customers!
So sad…
We just thought Gulf Power was a rip-off, I guess we haven’t seen nothing yet !
Guess our rates won’t be going Down and our service ( which was pretty good ) will get lousy.
Shareholders seem like the only winners in this buy-out ☹️
Another bad deal for locals.? I think so. Do we have a say in the matter?
I try to keep up with any important (ie. what affects me) news in the local outlets. Thanks North Escambia….this is the first I have heard of this. My first reaction is “BOHICA.”
Anyone who thinks this will be good for the customer should look into some swampland they have for sale too.
quotes verbatim:
“long-term shareholder value”
“NextEra Energy shareholders”
I am a former customer of Florida Power and light. They are a FAR cry from Gulf Power as far as concern for the customer. They always behaved with indifference when contacted and were quick to blame the customer for any issues. Their rates were obscene. I always referred to the as Florida Plunder and Loot.
I think we’ve always been protected by having out own provider. When South FL takes a huge hit financially because of a storm, we don’t end up having to pay for it. Havibg one provider means well share in all the expenses, even though we don’t create most of them.
“These transactions will provide meaningful benefits for the…..shareholders.”
Translation= Higher rates and more money for the shareholders.
Having a bigger monopoly on power sources in the state of Florida doesn’t sit well with me. Not that any customer gets a say in what they do with billing rates, I don’t think we get a say here either, but I don’t approve. More competition equals more competitive rates. This company was in the Saint Augustine area some years ago and I remember service not being that good either.
Note that they talk a lot about shareholders, balance sheet and their credit rating, not so much about keeping customer’s rates down…