FPL Unit Buys into Iowa Plant
Posted on: Wednesday, 6 July 2005, 21:00 CDT
Jul. 6--Juno Beach-based FPL Energy LLC has agreed to buy a majority interest in a Midwest nuclear power plant for $387 million, the company said Tuesday.
The acquisition will increase the company's nuclear generating capacity by about 49 percent.
FPL Energy, which operates in 24 states and sells power on the wholesale market, is buying a 70 percent interest in the Duane Arnold Energy Center in Palo, Iowa, from Interstate Power & Light, a unit of Alliant Energy Corp., whose headquarters are in Madison, Wis. Palo is located near Cedar Rapids.
The plant has generating capacity of 598 megawatts, while FPL Energy's other nuclear plant, in Seabrook, N.H., can produce 1,218 megawatts.
"This transaction will further diversify our generating fleet and supports our strategy of building a moderate risk, well-hedged portfolio," Jim Robo, FPL Energy's president, said in a statement. It will provide a low-cost source of electricity and complements the company's existing wind power facilities in the Midwest, he added. The company currently has about 500 megawatts of wind power generating capacity in the region.
All output from FPL Energy's share of the plant will be sold to IP&L under a long-term contract. FPL Energy will take over management and operation of the plant once the deal is closed, scheduled for late this year or early 2006.
Other partners in the plant, which employs 530, are the Central Iowa Power Cooperative, with 20 percent, and the Corn Belt Power Cooperative, with 10 percent.
FPL Energy said it plans new investments in the nuclear plant after the deal is closed and will increase staffing by about 10 percent.
FPL Energy and Florida Power & Light Co. are both subsidiaries of FPL Group Inc. FPL, which has 4.2 million customers in 35 Florida counties, also owns four nuclear facilities at St. Lucie, in St. Lucie County, and Turkey Point in Miami-Dade County.
FPL Energy generates electricity from natural gas, oil, nuclear, wind, hydro and solar facilities, and ranks as the country's largest producer of wind and solar power.
FPL Energy last year booked profits of $172 million on revenues of $1.7 billion. Its net income accounted for more than 19 percent of FPL Group's 2004 profits of $887 million.
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Source: South Florida Sun-Sentinel
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