Commission File Number | Exact name of registrants as specified in their charters, address of principal executive offices and registrants' telephone number | IRS Employer Identification Number | ||
1-8841 | NEXTERA ENERGY, INC. | 59-2449419 | ||
2-27612 | FLORIDA POWER & LIGHT COMPANY | 59-0247775 | ||
700 Universe Boulevard Juno Beach, Florida 33408 (561) 694-4000 |
NextEra Energy, Inc. Yes þ No o Florida Power & Light Company Yes þ No o |
NextEra Energy, Inc. Yes þ No o Florida Power & Light Company Yes þ No o |
NextEra Energy, Inc. | Large Accelerated Filer þ | Accelerated Filer ¨ | Non-Accelerated Filer ¨ | Smaller Reporting Company ¨ |
Florida Power & Light Company | Large Accelerated Filer ¨ | Accelerated Filer ¨ | Non-Accelerated Filer þ | Smaller Reporting Company ¨ |
Page No. | ||
PART I - FINANCIAL INFORMATION | ||
PART II - OTHER INFORMATION | ||
Item 5. | Other Information | |
• | NEE's and FPL's business, financial condition, results of operations and prospects may be adversely affected by the extensive regulation of their business. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected if they are unable to recover in a timely manner any significant amount of costs, a return on certain assets or an appropriate return on capital through base rates, cost recovery clauses, other regulatory mechanisms or otherwise. |
• | Regulatory decisions that are important to NEE and FPL may be materially adversely affected by political, regulatory and economic factors. |
• | FPL's use of derivative instruments could be subject to prudence challenges and, if found imprudent, could result in disallowances of cost recovery for such use by the Florida Public Service Commission (FPSC). |
• | Any reductions to, or the elimination of, governmental incentives that support renewable energy, including, but not limited to, tax incentives, renewable portfolio standards (RPS) or feed-in tariffs, or the imposition of additional taxes or other assessments on renewable energy, could result in, among other items, the lack of a satisfactory market for the development of new renewable energy projects, NextEra Energy Resources, LLC (NEER) abandoning the development of renewable energy projects, a loss of NEER's investments in renewable energy projects and reduced project returns, any of which could have a material adverse effect on NEE's business, financial condition, results of operations and prospects. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected as a result of new or revised laws, regulations or interpretations or other regulatory initiatives. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected if the rules implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) broaden the scope of its provisions regarding the regulation of over-the-counter (OTC) financial derivatives and make them applicable to NEE and FPL. |
• | NEE and FPL are subject to numerous environmental laws and regulations that require capital expenditures, increase their cost of operations and may expose them to liabilities. |
• | NEE's and FPL's business could be negatively affected by federal or state laws or regulations mandating new or additional limits on the production of greenhouse gas emissions. |
• | Extensive federal regulation of the operations of NEE and FPL exposes NEE and FPL to significant and increasing compliance costs and may also expose them to substantial monetary penalties and other sanctions for compliance failures. |
• | Changes in tax laws, as well as judgments and estimates used in the determination of tax-related asset and liability amounts, could adversely affect NEE's and FPL's business, financial condition, results of operations and prospects. |
• | NEE's and FPL's business, financial condition, results of operations and prospects may be materially adversely affected due to adverse results of litigation. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could suffer if NEE and FPL do not proceed with projects under development or are unable to complete the construction of, or capital improvements to, electric generation, transmission and distribution facilities, gas infrastructure facilities or other facilities on schedule or within budget. |
• | NEE and FPL may face risks related to project siting, financing, construction, permitting, governmental approvals and the negotiation of project development agreements that may impede their development and operating activities. |
• | The operation and maintenance of NEE's and FPL's electric generation, transmission and distribution facilities, gas |
• | NEE's and FPL's business, financial condition, results of operations and prospects may be negatively affected by a lack of growth or slower growth in the number of customers or in customer usage. |
• | NEE's and FPL's business, financial condition, results of operations and prospects can be materially adversely affected by weather conditions, including, but not limited to, the impact of severe weather. |
• | Threats of terrorism and catastrophic events that could result from terrorism, cyber attacks, or individuals and/or groups attempting to disrupt NEE's and FPL's business, or the businesses of third parties, may materially adversely affect NEE's and FPL's business, financial condition, results of operations and prospects. |
• | The ability of NEE and FPL to obtain insurance and the terms of any available insurance coverage could be adversely affected by international, national, state or local events and company-specific events, as well as the financial condition of insurers. NEE's and FPL's insurance coverage does not provide protection against all significant losses. |
• | If supply costs necessary to provide NEER's full energy and capacity requirement services are not favorable, operating costs could increase and adversely affect NEE's business, financial condition, results of operations and prospects. |
• | Due to the potential for significant volatility in market prices for fuel, electricity and renewable and other energy commodities, NEER's inability or failure to hedge effectively its assets or positions against changes in commodity prices, volumes, interest rates, counterparty credit risk or other risk measures could significantly impair NEE's results of operations. |
• | Sales of power on the spot market or on a short-term contractual basis may cause NEE's results of operations to be volatile. |
• | Reductions in the liquidity of energy markets may restrict the ability of NEE to manage its operational risks, which, in turn, could negatively affect NEE's results of operations. |
• | If price movements significantly or persistently deviate from historical behavior, NEE's and FPL's hedging and trading procedures and associated risk management tools may not protect against significant losses. |
• | If power transmission or natural gas, nuclear fuel or other commodity transportation facilities are unavailable or disrupted, FPL's and NEER's ability to sell and deliver power or natural gas may be limited. |
• | NEE and FPL are subject to credit and performance risk from customers, hedging counterparties and vendors. |
• | NEE and FPL could recognize financial losses or a reduction in operating cash flows if a counterparty fails to perform or make payments in accordance with the terms of derivative contracts or if NEE or FPL is required to post margin cash collateral under derivative contracts. |
• | NEE and FPL are highly dependent on sensitive and complex information technology systems, and any failure or breach of those systems could have a material adverse effect on their business, financial condition, results of operations and prospects. |
• | NEE's and FPL's retail businesses are subject to the risk that sensitive customer data may be compromised, which could result in an adverse impact to their reputation and/or the results of operations of the retail business. |
• | NEE and FPL could recognize financial losses as a result of volatility in the market values of derivative instruments and limited liquidity in OTC markets. |
• | NEE and FPL may be adversely affected by negative publicity. |
• | NEE's and FPL's business, financial condition, results of operations and prospects may be materially adversely affected if FPL is unable to maintain, negotiate or renegotiate franchise agreements on acceptable terms with municipalities and counties in Florida. |
• | Increasing costs associated with health care plans may materially adversely affect NEE's and FPL's results of operations. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could be negatively affected by the lack of a qualified workforce or the loss or retirement of key employees. |
• | NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected by work strikes or stoppages and increasing personnel costs. |
• | NEE's ability to successfully identify, complete and integrate acquisitions is subject to significant risks, including, but not limited to, the effect of increased competition for acquisitions resulting from the consolidation of the power industry. |
• | The construction, operation and maintenance of NEE's and FPL's nuclear generation facilities involve environmental, health and financial risks that could result in fines or the closure of the facilities and in increased costs and capital expenditures. |
• | In the event of an incident at any nuclear generation facility in the United States (U.S.) or at certain nuclear generation facilities in Europe, NEE and FPL could be assessed significant retrospective assessments and/or retrospective insurance premiums as a result of their participation in a secondary financial protection system and nuclear insurance mutual companies. |
• | U.S. Nuclear Regulatory Commission (NRC) orders or new regulations related to increased security measures and any future safety requirements promulgated by the NRC could require NEE and FPL to incur substantial operating and capital expenditures at their nuclear generation facilities. |
• | The inability to operate any of NEER's or FPL's nuclear generation units through the end of their respective operating licenses could have a material adverse effect on NEE's and FPL's business, financial condition, results of operations and prospects. |
• | Various hazards posed to nuclear generation facilities, along with increased public attention to and awareness of such hazards, could result in increased nuclear licensing or compliance costs which are difficult or impossible to predict and could have a material adverse effect on NEE's and FPL's business, financial condition, results of operations and prospects. |
• | NEE's and FPL's nuclear units are periodically removed from service to accommodate normal refueling and maintenance outages, and for other purposes. If planned outages last longer than anticipated or if there are unplanned outages, NEE's and FPL's results of operations and financial condition could be materially adversely affected. |
• | Disruptions, uncertainty or volatility in the credit and capital markets may negatively affect NEE's and FPL's ability to fund their liquidity and capital needs and to meet their growth objectives, and can also adversely affect the results of operations and financial condition of NEE and FPL. |
• | NEE's, NextEra Energy Capital Holdings, Inc.'s (NEECH) and FPL's inability to maintain their current credit ratings may adversely affect NEE's and FPL's liquidity and results of operations, limit the ability of NEE and FPL to grow their business, and increase interest costs. |
• | NEE's and FPL's liquidity may be impaired if their creditors are unable to fund their credit commitments to the companies or to maintain their current credit ratings. |
• | Poor market performance and other economic factors could affect NEE's and FPL's defined benefit pension plan's funded status, which may materially adversely affect NEE's and FPL's liquidity and results of operations. |
• | Poor market performance and other economic factors could adversely affect the asset values of NEE's and FPL's nuclear decommissioning funds, which may materially adversely affect NEE's and FPL's liquidity and results of operations. |
• | Certain of NEE's investments are subject to changes in market value and other risks, which may adversely affect NEE's liquidity and financial results. |
• | NEE 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 NEE. |
• | NEE may be unable to meet its ongoing and future financial obligations and to pay dividends on its common stock if NEE is required to perform under guarantees of obligations of its subsidiaries. |
• | Disruptions, uncertainty or volatility in the credit and capital markets may exert downward pressure on the market price of NEE's common stock. |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
OPERATING REVENUES | $ | 3,371 | $ | 3,134 | |||
OPERATING EXPENSES | |||||||
Fuel, purchased power and interchange | 1,182 | 1,404 | |||||
Other operations and maintenance | 775 | 693 | |||||
Depreciation and amortization | 320 | 331 | |||||
Taxes other than income taxes and other | 251 | 278 | |||||
Total operating expenses | 2,528 | 2,706 | |||||
OPERATING INCOME | 843 | 428 | |||||
OTHER INCOME (DEDUCTIONS) | |||||||
Interest expense | (265 | ) | (254 | ) | |||
Equity in earnings (losses) of equity method investees | (3 | ) | 10 | ||||
Allowance for equity funds used during construction | 13 | 12 | |||||
Interest income | 20 | 21 | |||||
Gains on disposal of assets - net | 11 | 17 | |||||
Other - net | (1 | ) | 2 | ||||
Total other deductions - net | (225 | ) | (192 | ) | |||
INCOME BEFORE INCOME TAXES | 618 | 236 | |||||
INCOME TAXES | 157 | (32 | ) | ||||
NET INCOME | $ | 461 | $ | 268 | |||
Earnings per share of common stock: | |||||||
Basic | $ | 1.12 | $ | 0.64 | |||
Assuming dilution | $ | 1.11 | $ | 0.64 | |||
Dividends per share of common stock | $ | 0.60 | $ | 0.55 | |||
Weighted-average number of common shares outstanding: | |||||||
Basic | 412.3 | 415.8 | |||||
Assuming dilution | 414.7 | 418.4 |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
NET INCOME | $ | 461 | $ | 268 | |||
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX | |||||||
Net unrealized gains (losses) on cash flow hedges: | |||||||
Effective portion of net unrealized losses (net of $2 and $5 tax benefit, respectively) | (7 | ) | (10 | ) | |||
Reclassification from accumulated other comprehensive income to net income (net of $9 and $8 tax expense, respectively) | 16 | 17 | |||||
Net unrealized gains (losses) on available for sale securities: | |||||||
Net unrealized gains on securities still held (net of $31 and $14 tax expense, respectively) | 47 | 22 | |||||
Reclassification from accumulated other comprehensive income to net income (net of $4 and $5 tax benefit, respectively) | (5 | ) | (9 | ) | |||
Defined benefit pension and other benefits plans (net of $8 tax benefit and $4 tax expense, respectively) | (12 | ) | 6 | ||||
Net unrealized gains on foreign currency translation (net of $3 and $5 tax expense, respectively) | 6 | 10 | |||||
Other comprehensive income related to equity method investee (net of $4 tax benefit) | 15 | — | |||||
Total other comprehensive income, net of tax | 60 | 36 | |||||
COMPREHENSIVE INCOME | $ | 521 | $ | 304 |
March 31, 2012 | December 31, 2011 | ||||||
PROPERTY, PLANT AND EQUIPMENT | |||||||
Electric utility plant in service and other property | $ | 51,485 | $ | 50,768 | |||
Nuclear fuel | 1,889 | 1,795 | |||||
Construction work in progress | 5,887 | 4,989 | |||||
Less accumulated depreciation and amortization | (15,293 | ) | (15,062 | ) | |||
Total property, plant and equipment - net ($3,828 and $3,063 related to VIEs, respectively) | 43,968 | 42,490 | |||||
CURRENT ASSETS | |||||||
Cash and cash equivalents | 275 | 377 | |||||
Customer receivables, net of allowances of $7 and $11, respectively | 1,262 | 1,372 | |||||
Other receivables | 575 | 430 | |||||
Materials, supplies and fossil fuel inventory | 1,092 | 1,074 | |||||
Regulatory assets: | |||||||
Deferred clause and franchise expenses | 89 | 112 | |||||
Derivatives | 590 | 502 | |||||
Other | 89 | 84 | |||||
Derivatives | 858 | 611 | |||||
Other | 264 | 310 | |||||
Total current assets | 5,094 | 4,872 | |||||
OTHER ASSETS | |||||||
Special use funds | 4,104 | 3,867 | |||||
Other investments | 937 | 907 | |||||
Prepaid benefit costs | 1,041 | 1,021 | |||||
Regulatory assets: | |||||||
Securitized storm-recovery costs ($310 and $317 related to a VIE, respectively) | 504 | 517 | |||||
Other | 625 | 621 | |||||
Derivatives | 1,067 | 973 | |||||
Other | 1,867 | 1,920 | |||||
Total other assets | 10,145 | 9,826 | |||||
TOTAL ASSETS | $ | 59,207 | $ | 57,188 | |||
CAPITALIZATION | |||||||
Common stock ($0.01 par value, authorized shares - 800; outstanding shares - 417 and 416, respectively) | $ | 4 | $ | 4 | |||
Additional paid-in capital | 5,224 | 5,217 | |||||
Retained earnings | 10,089 | 9,876 | |||||
Accumulated other comprehensive loss | (94 | ) | (154 | ) | |||
Total common shareholders' equity | 15,223 | 14,943 | |||||
Long-term debt ($1,327 and $1,364 related to VIEs, respectively) | 20,582 | 20,810 | |||||
Total capitalization | 35,805 | 35,753 | |||||
CURRENT LIABILITIES | |||||||
Commercial paper | 1,739 | 1,349 | |||||
Short-term debt | 191 | — | |||||
Current maturities of long-term debt | 1,458 | 808 | |||||
Accounts payable | 1,073 | 1,191 | |||||
Customer deposits | 528 | 547 | |||||
Accrued interest and taxes | 501 | 464 | |||||
Derivatives | 1,347 | 1,090 | |||||
Accrued construction-related expenditures | 484 | 518 | |||||
Other | 684 | 752 | |||||
Total current liabilities | 8,005 | 6,719 | |||||
OTHER LIABILITIES AND DEFERRED CREDITS | |||||||
Asset retirement obligations | 1,634 | 1,611 | |||||
Accumulated deferred income taxes | 5,813 | 5,681 | |||||
Regulatory liabilities: | |||||||
Accrued asset removal costs | 2,120 | 2,197 | |||||
Asset retirement obligation regulatory expense difference | 1,763 | 1,640 | |||||
Other | 457 | 419 | |||||
Derivatives | 690 | 541 | |||||
Deferral related to differential membership interests - VIEs | 1,479 | 1,203 | |||||
Other | 1,441 | 1,424 | |||||
Total other liabilities and deferred credits | 15,397 | 14,716 | |||||
COMMITMENTS AND CONTINGENCIES | |||||||
TOTAL CAPITALIZATION AND LIABILITIES | $ | 59,207 | $ | 57,188 |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 461 | $ | 268 | |||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||
Depreciation and amortization | 320 | 331 | |||||
Nuclear fuel amortization | 63 | 71 | |||||
Unrealized losses (gains) on marked to market energy contracts | (132 | ) | 231 | ||||
Deferred income taxes | 134 | 9 | |||||
Cost recovery clauses and franchise fees | 48 | 61 | |||||
Changes in prepaid option premiums and derivative settlements | (1 | ) | 11 | ||||
Equity in losses (earnings) of equity method investees | 3 | (10 | ) | ||||
Distributions of earnings from equity method investees | 8 | 23 | |||||
Allowance for equity funds used during construction | (13 | ) | (12 | ) | |||
Gains on disposal of assets - net | (11 | ) | (17 | ) | |||
Other - net | 16 | (2 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Customer receivables | 110 | 229 | |||||
Other receivables | (51 | ) | 21 | ||||
Materials, supplies and fossil fuel inventory | (18 | ) | (18 | ) | |||
Other current assets | (24 | ) | — | ||||
Other assets | 40 | (36 | ) | ||||
Accounts payable | (75 | ) | (105 | ) | |||
Margin cash collateral | 75 | (25 | ) | ||||
Income taxes | 8 | (43 | ) | ||||
Interest and other taxes | 66 | 61 | |||||
Other current liabilities | (168 | ) | (71 | ) | |||
Other liabilities | (24 | ) | 6 | ||||
Net cash provided by operating activities | 835 | 983 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Capital expenditures of FPL | (1,084 | ) | (658 | ) | |||
Independent power and other investments of NEER | (740 | ) | (633 | ) | |||
Cash grants under the American Recovery and Reinvestment Act of 2009 | — | 377 | |||||
Nuclear fuel purchases | (44 | ) | (47 | ) | |||
Other capital expenditures | (146 | ) | (106 | ) | |||
Change in loan proceeds restricted for construction | 45 | — | |||||
Proceeds from sale or maturity of securities in special use funds | 936 | 1,347 | |||||
Purchases of securities in special use funds | (973 | ) | (1,367 | ) | |||
Proceeds from sale or maturity of other securities | 99 | 154 | |||||
Purchases of other securities | (95 | ) | (177 | ) | |||
Other - net | 7 | 33 | |||||
Net cash used in investing activities | (1,995 | ) | (1,077 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Issuances of long-term debt | 566 | 201 | |||||
Retirements of long-term debt | (134 | ) | (252 | ) | |||
Proceeds from sale of differential membership interests | 303 | — | |||||
Net change in short-term debt | 582 | 488 | |||||
Issuances of common stock - net | 12 | 18 | |||||
Repurchases of common stock | (19 | ) | — | ||||
Dividends on common stock | (248 | ) | (229 | ) | |||
Other - net | (4 | ) | (9 | ) | |||
Net cash provided by financing activities | 1,058 | 217 | |||||
Net increase (decrease) in cash and cash equivalents | (102 | ) | 123 | ||||
Cash and cash equivalents at beginning of period | 377 | 302 | |||||
Cash and cash equivalents at end of period | $ | 275 | $ | 425 | |||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||||||
Accrued property additions | $ | 884 | $ | 499 |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
OPERATING REVENUES | $ | 2,224 | $ | 2,246 | |||
OPERATING EXPENSES | |||||||
Fuel, purchased power and interchange | 935 | 1,071 | |||||
Other operations and maintenance | 436 | 374 | |||||
Depreciation and amortization | 118 | 142 | |||||
Taxes other than income taxes and other | 254 | 253 | |||||
Total operating expenses | 1,743 | 1,840 | |||||
OPERATING INCOME | 481 | 406 | |||||
OTHER INCOME (DEDUCTIONS) | |||||||
Interest expense | (104 | ) | (91 | ) | |||
Allowance for equity funds used during construction | 10 | 11 | |||||
Total other deductions - net | (94 | ) | (80 | ) | |||
INCOME BEFORE INCOME TAXES | 387 | 326 | |||||
INCOME TAXES | 148 | 121 | |||||
NET INCOME(a) | $ | 239 | $ | 205 |
(a) | FPL's comprehensive income is the same as reported net income. |
March 31, 2012 | December 31, 2011 | ||||||
ELECTRIC UTILITY PLANT | |||||||
Plant in service | $ | 31,702 | $ | 31,564 | |||
Nuclear fuel | 1,084 | 1,005 | |||||
Construction work in progress | 3,356 | 2,601 | |||||
Less accumulated depreciation and amortization | (10,925 | ) | (10,916 | ) | |||
Total electric utility plant - net | 25,217 | 24,254 | |||||
CURRENT ASSETS | |||||||
Cash and cash equivalents | 16 | 36 | |||||
Customer receivables, net of allowances of $5 and $8, respectively | 634 | 682 | |||||
Other receivables | 422 | 312 | |||||
Materials, supplies and fossil fuel inventory | 781 | 759 | |||||
Regulatory assets: | |||||||
Deferred clause and franchise expenses | 89 | 112 | |||||
Derivatives | 590 | 502 | |||||
Other | 82 | 80 | |||||
Other | 121 | 166 | |||||
Total current assets | 2,735 | 2,649 | |||||
OTHER ASSETS | |||||||
Special use funds | 2,884 | 2,737 | |||||
Prepaid benefit costs | 1,100 | 1,088 | |||||
Regulatory assets: | |||||||
Securitized storm-recovery costs ($310 and $317 related to a VIE, respectively) | 504 | 517 | |||||
Other | 374 | 395 | |||||
Other | 182 | 176 | |||||
Total other assets | 5,044 | 4,913 | |||||
TOTAL ASSETS | $ | 32,996 | $ | 31,816 | |||
CAPITALIZATION | |||||||
Common stock (no par value, 1,000 shares authorized, issued and outstanding) | $ | 1,373 | $ | 1,373 | |||
Additional paid-in capital | 5,503 | 5,464 | |||||
Retained earnings | 4,253 | 4,013 | |||||
Total common shareholder's equity | 11,129 | 10,850 | |||||
Long-term debt ($410 and $437 related to a VIE, respectively) | 7,056 | 7,483 | |||||
Total capitalization | 18,185 | 18,333 | |||||
CURRENT LIABILITIES | |||||||
Commercial paper | 837 | 330 | |||||
Current maturities of long-term debt | 451 | 50 | |||||
Accounts payable | 646 | 678 | |||||
Customer deposits | 522 | 541 | |||||
Accrued interest and taxes | 292 | 221 | |||||
Derivatives | 607 | 512 | |||||
Accrued construction-related expenditures | 282 | 261 | |||||
Other | 330 | 373 | |||||
Total current liabilities | 3,967 | 2,966 | |||||
OTHER LIABILITIES AND DEFERRED CREDITS | |||||||
Asset retirement obligations | 1,160 | 1,144 | |||||
Accumulated deferred income taxes | 4,849 | 4,593 | |||||
Regulatory liabilities: | |||||||
Accrued asset removal costs | 2,120 | 2,197 | |||||
Asset retirement obligation regulatory expense difference | 1,763 | 1,640 | |||||
Other | 409 | 416 | |||||
Other | 543 | 527 | |||||
Total other liabilities and deferred credits | 10,844 | 10,517 | |||||
COMMITMENTS AND CONTINGENCIES | |||||||
TOTAL CAPITALIZATION AND LIABILITIES | $ | 32,996 | $ | 31,816 |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
Net income | $ | 239 | $ | 205 | |||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||
Depreciation and amortization | 118 | 142 | |||||
Nuclear fuel amortization | 23 | 34 | |||||
Deferred income taxes | 265 | 220 | |||||
Cost recovery clauses and franchise fees | 48 | 61 | |||||
Allowance for equity funds used during construction | (10 | ) | (11 | ) | |||
Other - net | 10 | (11 | ) | ||||
Changes in operating assets and liabilities: | |||||||
Customer receivables | 47 | 136 | |||||
Other receivables | 6 | 33 | |||||
Materials, supplies and fossil fuel inventory | (22 | ) | (22 | ) | |||
Other current assets | (21 | ) | (6 | ) | |||
Other assets | (11 | ) | (15 | ) | |||
Accounts payable | 6 | (47 | ) | ||||
Income taxes | (117 | ) | (132 | ) | |||
Interest and other taxes | 77 | 73 | |||||
Other current liabilities | (107 | ) | (27 | ) | |||
Other liabilities | 7 | (1 | ) | ||||
Net cash provided by operating activities | 558 | 632 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
Capital expenditures | (1,084 | ) | (658 | ) | |||
Cash grants under the American Recovery and Reinvestment Act of 2009 | — | 154 | |||||
Nuclear fuel purchases | (28 | ) | (36 | ) | |||
Proceeds from sale or maturity of securities in special use funds | 727 | 964 | |||||
Purchases of securities in special use funds | (758 | ) | (978 | ) | |||
Other - net | 26 | — | |||||
Net cash used in investing activities | (1,117 | ) | (554 | ) | |||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
Retirements of long-term debt | (25 | ) | (24 | ) | |||
Net change in short-term debt | 507 | 330 | |||||
Capital contribution from NEE | 40 | — | |||||
Dividends to NEE | — | (400 | ) | ||||
Other - net | 17 | 17 | |||||
Net cash provided by (used in) financing activities | 539 | (77 | ) | ||||
Net increase (decrease) in cash and cash equivalents | (20 | ) | 1 | ||||
Cash and cash equivalents at beginning of period | 36 | 20 | |||||
Cash and cash equivalents at end of period | $ | 16 | $ | 21 | |||
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||||||
Accrued property additions | $ | 560 | $ | 331 |
Pension Benefits | Other Benefits | |||||||||||||||
Three Months Ended March 31, | Three Months Ended March 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
(millions) | ||||||||||||||||
Service cost | $ | 16 | $ | 16 | $ | 1 | $ | 2 | ||||||||
Interest cost | 25 | 25 | 5 | 5 | ||||||||||||
Expected return on plan assets | (60 | ) | (60 | ) | — | (1 | ) | |||||||||
Amortization of transition obligation | — | — | 1 | 1 | ||||||||||||
Amortization of prior service cost (benefit) | 1 | (1 | ) | — | — | |||||||||||
Net periodic benefit (income) cost at NEE | $ | (18 | ) | $ | (20 | ) | $ | 7 | $ | 7 | ||||||
Net periodic benefit (income) cost at FPL | $ | (11 | ) | $ | (13 | ) | $ | 5 | $ | 5 |
NEE | FPL | ||||||||||||||||
March 31, 2012 | December 31, 2011 | March 31, 2012 | December 31, 2011 | ||||||||||||||
(millions) | |||||||||||||||||
Current derivative assets(a) | $ | 858 | $ | 611 | $ | 17 | (b) | $ | 10 | (b) | |||||||
Noncurrent derivative assets(c) | 1,067 | 973 | 4 | (d) | 2 | (d) | |||||||||||
Current derivative liabilities(e) | (1,347 | ) | (1,090 | ) | (607 | ) | (512 | ) | |||||||||
Noncurrent derivative liabilities(f) | (690 | ) | (541 | ) | (11 | ) | (g) | (1 | ) | (g) | |||||||
Total mark-to-market derivative instrument assets (liabilities) | $ | (112 | ) | $ | (47 | ) | $ | (597 | ) | $ | (501 | ) |
(a) | At March 31, 2012 and December 31, 2011, NEE's balances reflect the netting of approximately $113 million and $106 million (none at FPL), respectively, in margin cash collateral received from counterparties. |
(b) | Included in current other assets on FPL's condensed consolidated balance sheets. |
(c) | At March 31, 2012 and December 31, 2011, NEE's balances reflect the netting of approximately $160 million and $109 million (none at FPL), respectively, in margin cash collateral received from counterparties. |
(d) | Included in noncurrent other assets on FPL's condensed consolidated balance sheets. |
(e) | At March 31, 2012 and December 31, 2011, NEE's balances reflect the netting of approximately $114 million and $112 million (none at FPL), respectively, in margin cash collateral provided to counterparties. |
(f) | At March 31, 2012 and December 31, 2011, NEE's balances reflect the netting of approximately $56 million and $79 million (none at FPL), respectively, in margin cash collateral provided to counterparties. |
(g) | Included in noncurrent other liabilities on FPL's condensed consolidated balance sheets. |
March 31, 2012 | December 31, 2011 | |||||||||||||||
Derivative Assets | Derivative Liabilities | Derivative Assets | Derivative Liabilities | |||||||||||||
(millions) | ||||||||||||||||
Interest rate swaps: | ||||||||||||||||
Current derivative assets | $ | 34 | $ | — | $ | 22 | $ | — | ||||||||
Current derivative liabilities | — | 63 | — | 60 | ||||||||||||
Noncurrent derivative assets | 9 | — | 15 | — | ||||||||||||
Noncurrent derivative liabilities | — | 243 | — | 260 | ||||||||||||
Foreign currency swap: | ||||||||||||||||
Current derivative liabilities | — | 3 | — | 3 | ||||||||||||
Noncurrent derivative liabilities | — | 11 | — | 3 | ||||||||||||
Total | $ | 43 | $ | 320 | $ | 37 | $ | 326 |
Three Months Ended March 31, | |||||||||||||||||||||||||||||||
2012 | 2011 | ||||||||||||||||||||||||||||||
Commodity Contracts | Interest Rate Swaps | Foreign Currency Swap | Total | Commodity Contracts | Interest Rate Swaps | Foreign Currency Swaps | Total | ||||||||||||||||||||||||
(millions) | |||||||||||||||||||||||||||||||
Gains (losses) recognized in OCI | $ | — | $ | 1 | $ | (10 | ) | $ | (9 | ) | $ | — | $ | 1 | $ | (16 | ) | $ | (15 | ) | |||||||||||
Gains (losses) reclassified from AOCI to net income(a) | $ | 1 | $ | (16 | ) | $ | (10 | ) | (b) | $ | (25 | ) | $ | 5 | $ | (19 | ) | $ | (11 | ) | (b) | $ | (25 | ) |
(a) | Included in operating revenues for commodity contracts and interest expense for interest rate swaps. |
(b) | Loss of approximately $1 million is included in interest expense and the balance is included in other - net. |
March 31, 2012 | December 31, 2011 | |||||||||||||||||||||||||||||||
NEE | FPL | NEE | FPL | |||||||||||||||||||||||||||||
Derivative Assets | Derivative Liabilities | Derivative Assets | Derivative Liabilities | Derivative Assets | Derivative Liabilities | Derivative Assets | Derivative Liabilities | |||||||||||||||||||||||||
(millions) | ||||||||||||||||||||||||||||||||
Commodity contracts: | ||||||||||||||||||||||||||||||||
Current derivative assets | $ | 1,447 | $ | 510 | $ | 18 | (a) | $ | 1 | (a) | $ | 1,127 | $ | 432 | $ | 11 | (a) | $ | 1 | (a) | ||||||||||||
Current derivative liabilities | 4,244 | 5,636 | 5 | 612 | 3,358 | 4,494 | 1 | 513 | ||||||||||||||||||||||||
Noncurrent derivative assets | 1,631 | 413 | 4 | (b) | — | 1,290 | 250 | 2 | (b) | — | ||||||||||||||||||||||
Noncurrent derivative liabilities | 1,416 | 1,898 | 1 | (c) | 12 | (c) | 1,222 | 1,579 | — | 1 | (c) | |||||||||||||||||||||
Foreign currency swap: | ||||||||||||||||||||||||||||||||
Current derivative liabilities | — | 3 | — | — | — | 3 | — | — | ||||||||||||||||||||||||
Noncurrent derivative assets | — | — | — | — | 27 | — | — | — | ||||||||||||||||||||||||
Noncurrent derivative liabilities | — | 10 | — | — | — | — | — | — | ||||||||||||||||||||||||
Total | $ | 8,738 | $ | 8,470 | $ | 28 | $ | 625 | $ | 7,024 | $ | 6,758 | $ | 14 | $ | 515 |
(a) | Included in current other assets on FPL's condensed consolidated balance sheets. |
(b) | Included in noncurrent other assets on FPL's condensed consolidated balance sheets. |
(c) | Included in noncurrent other liabilities on FPL's condensed consolidated balance sheets. |
Three Months Ended March 31, | |||||||
2012 | 2011 | ||||||
(millions) | |||||||
Commodity contracts(a): | |||||||
Operating revenues | $ | 190 | $ | (152 | ) | ||
Fuel, purchased power and interchange | (11 | ) | (25 | ) | |||
Foreign currency swap - other - net | (37 | ) | (5 | ) | |||
Total | $ | 142 | $ | (182 | ) |
(a) | For the three months ended March 31, 2012 and 2011, FPL recorded approximately $252 million and less than $1 million of losses, respectively, related to commodity contracts as regulatory assets on its condensed consolidated balance sheets. |
Commodity Type | NEE | FPL | ||||||||
(millions) | ||||||||||
Power | (86 | ) | mwh(a) | — | ||||||
Natural gas | 1,481 | mmbtu(b) | 1,063 | mmbtu(b) | ||||||
Oil | (3 | ) | barrels | — |
(a) | Megawatt-hours |
(b) | One million British thermal units |
March 31, 2012 | ||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting(a) | Total | ||||||||||||||||
(millions) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||
NEE - equity securities | $ | 105 | $ | — | $ | — | $ | — | $ | 105 | ||||||||||
FPL - equity securities | $ | 5 | $ | — | $ | — | $ | — | $ | 5 | ||||||||||
Special use funds: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Equity securities | $ | 797 | $ | 1,421 | (b) | $ | — | $ | — | $ | 2,218 | |||||||||
U.S. Government and municipal bonds | $ | 507 | $ | 142 | $ | — | $ | — | $ | 649 | ||||||||||
Corporate debt securities | $ | — | $ | 462 | $ | — | $ | — | $ | 462 | ||||||||||
Mortgage-backed securities | $ | — | $ | 512 | $ | — | $ | — | $ | 512 | ||||||||||
Other debt securities | $ | 1 | $ | 39 | $ | — | $ | — | $ | 40 | ||||||||||
FPL: | ||||||||||||||||||||
Equity securities | $ | 143 | $ | 1,259 | (b) | $ | — | $ | — | $ | 1,402 | |||||||||
U.S. Government and municipal bonds | $ | 460 | $ | 111 | $ | — | $ | — | $ | 571 | ||||||||||
Corporate debt securities | $ | — | $ | 298 | $ | — | $ | — | $ | 298 | ||||||||||
Mortgage-backed securities | $ | — | $ | 436 | $ | — | $ | — | $ | 436 | ||||||||||
Other debt securities | $ | — | $ | 26 | $ | — | $ | — | $ | 26 | ||||||||||
Other investments: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Equity securities | $ | 10 | $ | — | $ | — | $ | — | $ | 10 | ||||||||||
U.S. Government and municipal bonds | $ | 9 | $ | — | $ | — | $ | — | $ | 9 | ||||||||||
Corporate debt securities | $ | — | $ | 42 | $ | — | $ | — | $ | 42 | ||||||||||
Mortgage-backed securities | $ | — | $ | 42 | $ | — | $ | — | $ | 42 | ||||||||||
Other | $ | 5 | $ | 4 | $ | — | $ | — | $ | 9 | ||||||||||
Derivatives: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Commodity contracts | $ | 3,115 | $ | 4,316 | $ | 1,307 | $ | (6,856 | ) | $ | 1,882 | (c) | ||||||||
Interest rate swaps | $ | — | $ | 43 | $ | — | $ | — | $ | 43 | (c) | |||||||||
FPL - commodity contracts | $ | — | $ | 18 | $ | 10 | $ | (7 | ) | $ | 21 | (c) | ||||||||
Liabilities: | ||||||||||||||||||||
Derivatives: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Commodity contracts | $ | 3,237 | $ | 4,502 | $ | 718 | $ | (6,753 | ) | $ | 1,704 | (c) | ||||||||
Interest rate swaps | $ | — | $ | 306 | $ | — | $ | — | $ | 306 | (c) | |||||||||
Foreign currency swaps | $ | — | $ | 27 | $ | — | $ | — | $ | 27 | (c) | |||||||||
FPL - commodity contracts | $ | — | $ | 622 | $ | 3 | $ | (7 | ) | $ | 618 | (c) |
(a) | Includes the effect of the contractual ability to settle contracts under master netting arrangements and margin cash collateral payments and receipts. |
(b) | At NEE, approximately $1,226 million ($1,106 million at FPL) are invested in commingled funds whose underlying investments would be Level 1 if those investments were held directly by NEE or FPL. |
(c) | See Note 2 for a reconciliation of net derivatives to NEE's and FPL's condensed consolidated balance sheets. |
December 31, 2011 | ||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Netting(a) | Total | ||||||||||||||||
(millions) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Cash equivalents: | ||||||||||||||||||||
NEE - equity securities | $ | 159 | $ | — | $ | — | $ | — | $ | 159 | ||||||||||
FPL - equity securities | $ | 11 | $ | — | $ | — | $ | — | $ | 11 | ||||||||||
Special use funds: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Equity securities | $ | 709 | $ | 1,206 | (b) | $ | — | $ | — | $ | 1,915 | |||||||||
U.S. Government and municipal bonds | $ | 508 | $ | 167 | $ | — | $ | — | $ | 675 | ||||||||||
Corporate debt securities | $ | — | $ | 516 | $ | — | $ | — | $ | 516 | ||||||||||
Mortgage-backed securities | $ | — | $ | 511 | $ | — | $ | — | $ | 511 | ||||||||||
Other debt securities | $ | — | $ | 47 | $ | — | $ | — | $ | 47 | ||||||||||
FPL: | ||||||||||||||||||||
Equity securities | $ | 128 | $ | 1,056 | (b) | $ | — | $ | — | $ | 1,184 | |||||||||
U.S. Government and municipal bonds | $ | 458 | $ | 134 | $ | — | $ | — | $ | 592 | ||||||||||
Corporate debt securities | $ | — | $ | 359 | $ | — | $ | — | $ | 359 | ||||||||||
Mortgage-backed securities | $ | — | $ | 434 | $ | — | $ | — | $ | 434 | ||||||||||
Other debt securities | $ | — | $ | 32 | $ | — | $ | — | $ | 32 | ||||||||||
Other investments: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Equity securities | $ | 4 | $ | — | $ | — | $ | — | $ | 4 | ||||||||||
U.S. Government and municipal bonds | $ | 8 | $ | — | $ | — | $ | — | $ | 8 | ||||||||||
Corporate debt securities | $ | — | $ | 43 | $ | — | $ | — | $ | 43 | ||||||||||
Mortgage-backed securities | $ | — | $ | 33 | $ | — | $ | — | $ | 33 | ||||||||||
Other | $ | 5 | $ | 5 | $ | — | $ | — | $ | 10 | ||||||||||
Derivatives: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Commodity contracts | $ | 2,448 | $ | 3,478 | $ | 1,071 | $ | (5,477 | ) | $ | 1,520 | (c) | ||||||||
Interest rate swaps | $ | — | $ | 37 | $ | — | $ | — | $ | 37 | (c) | |||||||||
Foreign currency swaps | $ | — | $ | 27 | $ | — | $ | — | $ | 27 | (c) | |||||||||
FPL - commodity contracts | $ | — | $ | 8 | $ | 6 | $ | (2 | ) | $ | 12 | (c) | ||||||||
Liabilities: | ||||||||||||||||||||
Derivatives: | ||||||||||||||||||||
NEE: | ||||||||||||||||||||
Commodity contracts | $ | 2,588 | $ | 3,582 | $ | 585 | $ | (5,453 | ) | $ | 1,302 | (c) | ||||||||
Interest rate swaps | $ | — | $ | 320 | $ | — | $ | — | $ | 320 | (c) | |||||||||
Foreign currency swaps | $ | — | $ | 9 | $ | — | $ | — | $ | 9 | (c) | |||||||||
FPL - commodity contracts | $ | — | $ | 513 | $ | 2 | $ | (2 | ) | $ | 513 | (c) |
(a) | Includes the effect of the contractual ability to settle contracts under master netting arrangements and margin cash collateral payments and receipts. |
(b) | At NEE, approximately $1,086 million ($979 million at FPL) are invested in commingled funds whose underlying investments would be Level 1 if those investments were held directly by NEE or FPL. |
(c) | See Note 2 for a reconciliation of net derivatives to NEE's and FPL's condensed consolidated balance sheets. |
Transaction Type | Fair Value at March 31, 2012 | Valuation Technique(s) | Significant Unobservable Inputs | Range | ||||||||
Assets | Liabilities | |||||||||||
(millions) |