4. Financial Instruments

The carrying amounts of cash equivalents and commercial paper approximate their fair values. At September 30, 2011 and December 31, 2010, other investments of NextEra Energy, not included in the table below, included financial instruments of approximately $75 million and $97 million ($4 million and $4 million at FPL), respectively, including $41 million and $48 million included in current other receivables on the condensed consolidated balance sheets (none at FPL), which primarily consist of notes receivable that are carried at estimated fair value or cost, which approximates fair value.

The following estimates of the fair value of financial instruments have been made primarily using available market information. However, the use of different market assumptions or methods of valuation could result in different estimated fair values.



	September 30, 2011								December 31, 2010
	Carrying Amount				Estimated Fair Value				Carrying Amount				Estimated Fair Value
	(millions)
NextEra Energy:
Special use funds	$	3,668		^(a)	$	3,668		^(b)	$	3,742		^(a)	$	3,742		^(b)
Other investments:
Notes receivable	$	503			$	521		^(c)	$	525			$	583		^(c)
Debt securities	$	94		^(d)	$	94		^(b)	$	114		^(d)	$	114		^(b)
Equity securities	$	75			$	154		^(e)	$	57			$	125		^(e)
Long-term debt, including current maturities	$	20,632		^(f)	$	22,578		^(g)	$	19,929			$	20,756		^(g)
Interest rate swaps - net unrealized losses	$	(276	)	^(f)	$	(276	)	^(h)	$	(16	)		$	(16	)	^(h)
Foreign currency swaps - net unrealized gains	$	11			$	11		^(h)	$	44			$	44		^(h)
FPL:
Special use funds	$	2,611		^(a)	$	2,611		^(b)	$	2,637		^(a)	$	2,637		^(b)
Long-term debt, including current maturities	$	6,934			$	8,346		^(g)	$	6,727			$	7,236		^(g)

————————————

(a)

At September 30, 2011, includes $150 million of investments accounted for under the equity method and $40 million of loans not measured at fair value on a recurring basis ($105 million and $25 million, respectively, for FPL). At December 31, 2010, includes $76 million of investments accounted for under the equity method and $17 million of loans not measured at fair value on a recurring basis ($94 million and $11 million, respectively, for FPL). For the remaining balances, see Note 3 for classification by major security type. The amortized cost of debt and equity securities is $1,645 million and $1,405 million, respectively, at September 30, 2011 and $1,616 million and $1,489 million, respectively, at December 31, 2010 ($1,317 million and $859 million, respectively, at September 30, 2011 and $1,281 million and $943 million, respectively, at December 31, 2010 for FPL).


(b)	Based on quoted market prices for these or similar issues.

(c)

Classified as held to maturity. Based on market prices provided by external sources. Notes receivable bear interest primarily at fixed rates and mature from 2014 to 2029. Notes receivable are considered impaired and placed in non-accrual status when it becomes probable that all amounts due cannot be collected in accordance with the contractual terms of the agreement. The assessment to place notes receivable in non-accrual status considers various credit indicators, such as credit standings and ratings and market-related information. As of September 30, 2011, neither NextEra Energy nor FPL had any notes receivable reported in non-accrual status.


(d)	Classified as trading securities.


(e)	Modeled internally based on latest market data.


(f)	Exclude balances related to liabilities associated with assets held for sale. See Note 3 - Nonrecurring Fair Value Measurements.


(g)	Provided by external sources based on market prices indicative of market conditions.


(h)	Modeled internally based on market values using discounted cash flow analysis and credit valuation adjustment.

Special Use Funds - The special use funds consist of FPL's storm fund assets of $129 million and NextEra Energy's and FPL's nuclear decommissioning fund assets of $3,539 million and $2,482 million, respectively, at September 30, 2011. The majority of investments held in the special use funds consist of equity and debt securities which are classified as available for sale and are carried at estimated fair value (see Note 3). For FPL's special use funds, consistent with regulatory treatment, changes in fair value, including any other than temporary impairment losses, result in a corresponding adjustment to the related regulatory liability accounts. For NextEra Energy's non-rate regulated operations, changes in fair value result in a corresponding adjustment to OCI, except for unrealized losses associated with marketable securities considered to be other than temporary, including any credit losses, which are recognized as other than temporary impairment losses on securities held in nuclear decommissioning funds and included in Other - net in NextEra Energy's condensed consolidated statements of income. Debt securities included in the nuclear decommissioning funds have a weighted-average maturity at September 30, 2011 of approximately six years at both NextEra Energy and FPL. FPL's storm fund primarily consists of debt securities with a weighted-average maturity at September 30, 2011 of approximately three years. The cost of securities sold is determined using the specific identification method.

Realized gains and losses and proceeds from the sale or maturity of available for sale securities are as follows:



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011				2010				2011				2010
	NextEra Energy		FPL		NextEra Energy		FPL		NextEra Energy		FPL		NextEra Energy		FPL
	(millions)
Realized gains	$	69	$	22	$	23	$	7	$	156	$	60	$	85	$	38
Realized losses	$	27	$	17	$	6	$	4	$	70	$	51	$	21	$	14
Proceeds from sale or maturity of securities	$	992	$	675	$	1,212	$	775	$	3,567	$	2,483	$	5,350	$	4,088

Unrealized losses on available for sale debt securities at September 30, 2011 and December 31, 2010 were not material to NextEra

Energy or FPL. The unrealized gains on available for sale securities are as follows:



	NextEra Energy				FPL
	September 30, 2011		December 31, 2010		September 30, 2011		December 31, 2010
	(millions)
Equity securities	$	372	$	612	$	264	$	384
U.S. Government and municipal bonds	$	48	$	15	$	43	$	15
Corporate debt securities	$	28	$	23	$	23	$	19
Mortgage-backed securities	$	27	$	20	$	24	$	18
Other debt securities	$	3	$	2	$	3	$	1

Regulations issued by the Federal Energy Regulatory Commission (FERC) and the U.S. Nuclear Regulatory Commission (NRC) provide general risk management guidelines to protect nuclear decommissioning funds and to allow such funds to earn a reasonable return. The FERC regulations prohibit, among other investments, investments in any securities of NextEra Energy or its subsidiaries, affiliates or associates, excluding investments tied to market indices or mutual funds. Similar restrictions applicable to the decommissioning funds for NextEra Energy Resources' nuclear plants are included in the NRC operating licenses for those facilities or in NRC regulations applicable to NRC licensees not in cost-of-service environments. With respect to the decommissioning fund for NextEra Energy Resources' Seabrook Station (Seabrook), decommissioning fund contributions and withdrawals are also regulated by the Nuclear Decommissioning Financing Committee pursuant to New Hampshire law.

The nuclear decommissioning reserve funds are managed by investment managers who must comply with the guidelines of NextEra Energy and FPL and the rules of the applicable regulatory authorities. The funds' assets are invested giving consideration to taxes, liquidity, risk, diversification and other prudent investment objectives.

Interest Rate and Foreign Currency Swaps - NextEra Energy and its subsidiaries use a combination of fixed rate and variable rate debt to manage interest rate exposure. Interest rate swaps are used to mitigate and adjust interest rate exposure when deemed appropriate based upon market conditions or when required by financing agreements. In addition, with respect to certain debt issuances and borrowings, Capital Holdings has entered into cross currency swaps, one of which hedges against currency movements with respect to both interest and principal payments and another which hedges against currency and interest rate movements with respect to both interest and principal payments. See Note 2.