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Commitments and Contingencies | 3 Months Ended
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Mar. 31, 2023
Commitments and Contingencies [Abstract] |
Commitments and Contingencies | Commitments and Contingencies Commitments – NEE and its subsidiaries have made commitments in connection with a portion of their projected capital expenditures. Capital expenditures at FPL include, among other things, the cost for construction of additional facilities and equipment to meet customer demand, as well as capital improvements to and maintenance of existing facilities. At NEER, capital expenditures include, among other things, the cost, including capitalized interest, for development, construction and maintenance of its competitive energy businesses. Also see Note 3 – Contingent Consideration. At March 31, 2023, estimated capital expenditures, on an accrual basis, for the remainder of 2023 through 2027 were as follows:
| Remainder of 2023 |  | 2024 |  | 2025 |  | 2026 |  | 2027 |  | Total
| (millions)
FPL: |  |  |  |  |  |  |  |  |  |  |
Generation:(a) |  |  |  |  |  |  |  |  |  |  |
New(b) | $ | 2,810 |  |  | $ | 2,315 |  |  | $ | 2,820 |  |  | $ | 3,670 |  |  | $ | 3,150 |  |  | $ | 14,765 |
Existing | 1,110 |  | 1,175 |  | 1,045 |  | 1,280 |  | 1,465 |  | 6,075 |
Transmission and distribution(c) | 1,945 |  | 3,975 |  | 3,645 |  | 3,340 |  | 3,575 |  | 16,480 |
Nuclear fuel | 90 |  | 160 |  | 200 |  | 200 |  | 225 |  | 875 |
General and other | 510 |  | 455 |  | 515 |  | 385 |  | 525 |  | 2,390 |
Total | $ | 6,465 |  |  | $ | 8,080 |  |  | $ | 8,225 |  |  | $ | 8,875 |  |  | $ | 8,940 |  |  | $ | 40,585 |
NEER:(d) |  |  |  |  |  |  |  |  |  |  |
Wind(e) | $ | 2,750 |  |  | $ | 1,320 |  |  | $ | 625 |  |  | $ | 50 |  |  | $ | 40 |  |  | $ | 4,785 |
Solar(f) | 3,365 |  |  | 1,320 |  |  | 240 |  |  | 5 |  |  | 5 |  |  | 4,935 |
Other clean energy(g) | 705 |  |  | 300 |  |  | 80 |  |  | 90 |  |  | 15 |  |  | 1,190 |
Nuclear, including nuclear fuel | 140 |  |  | 230 |  |  | 220 |  |  | 225 |  |  | 295 |  |  | 1,110 |
Rate-regulated transmission | 185 |  |  | 105 |  |  | 95 |  |  | 70 |  |  | 20 |  |  | 475 |
Other | 580 |  |  | 275 |  |  | 175 |  |  | 160 |  |  | 130 |  |  | 1,320 |
Total | $ | 7,725 |  |  | $ | 3,550 |  |  | $ | 1,435 |  |  | $ | 600 |  |  | $ | 505 |  |  | $ | 13,815 |
——————————————— (a)Includes AFUDC of approximately $100 million, $105 million, $90 million, $125 million and $115 million for the remainder of 2023 through 2027, respectively. (b)Includes land, generation structures, transmission interconnection and integration and licensing. (c)Includes AFUDC of approximately $40 million, $50 million, $55 million, $30 million and $30 million for the remainder of 2023 through 2027, respectively. (d)Represents capital expenditures for which applicable internal approvals and also, if required, regulatory approvals have been received. (e)Consists of capital expenditures for new wind projects and repowering of existing wind projects totaling approximately 3,081 MW, and related transmission. (f)Includes capital expenditures for new solar projects (including solar plus battery storage projects) totaling approximately 6,890 MW and related transmission. (g)Includes capital expenditures primarily for battery storage projects and renewable fuels projects. The above estimates are subject to continuing review and adjustment and actual capital expenditures may vary significantly from these estimates. In addition to guarantees noted in Note 6 with regards to NEP, NEECH has guaranteed or provided indemnifications or letters of credit related to third parties, including certain obligations of investments in joint ventures accounted for under the equity method, totaling approximately $493 million at March 31, 2023. These obligations primarily related to guaranteeing the residual value of certain financing leases. Payment guarantees and related contracts with respect to unconsolidated entities for which NEE or one of its subsidiaries are the guarantor are recorded at fair value and are included in noncurrent other liabilities on NEE’s condensed consolidated balance sheets. Management believes that the exposure associated with these guarantees is not material. Contracts – In addition to the commitments made in connection with the estimated capital expenditures included in the table in Commitments above, FPL has firm commitments under long-term contracts primarily for the transportation of natural gas with expiration dates through 2042. At March 31, 2023, NEER has entered into contracts with expiration dates through 2033 primarily for the purchase of wind turbines, wind towers and solar modules and related construction and development activities, as well as for the supply of uranium, and the conversion, enrichment and fabrication of nuclear fuel. Approximately $4.6 billion of related commitments are included in the estimated capital expenditures table in Commitments above. In addition, NEER has contracts primarily for the transportation and storage of natural gas with expiration dates through 2041. The required capacity and/or minimum payments under contracts, including those discussed above, at March 31, 2023 were estimated as follows:
| Remainder of 2023 |  | 2024 |  | 2025 |  | 2026 |  | 2027 |  | Thereafter
| (millions)
FPL(a) | $ | 835 |  |  | $ | 1,065 |  |  | $ | 1,065 |  |  | $ | 1,065 |  |  | $ | 985 |  |  | $ | 8,545 |
NEER(b)(c)(d) | $ | 3,230 |  |  | $ | 1,800 |  |  | $ | 145 |  |  | $ | 100 |  |  | $ | 95 |  |  | $ | 670 |
——————————————— (a)Includes approximately $310 million, $410 million, $405 million, $400 million, $400 million and $5,560 million for the remainder of 2023 through 2027 and thereafter, respectively, of firm commitments related to the natural gas transportation agreements with Sabal Trail and Florida Southeast Connection. The charges associated with these agreements are recoverable through the fuel clause and totaled approximately $102 million and $102 million for the three months ended March 31, 2023 and 2022, respectively, of which $25 million and $26 million, respectively, were eliminated in consolidation at NEE. (b)Excludes commitments related to equity contributions and a 20-year natural gas transportation agreement (approximately $70 million per year) with a joint venture, in which NEER has a 32.2% equity investment, that is constructing a natural gas pipeline. These commitments are subject to the completion of construction of the pipeline which has a very low probability of completion. See Note 3 – Nonrecurring Fair Value Measurements. (c)Includes approximately $260 million of commitments to invest in technology and other investments through 2031. See Note 7 – Other. (d)Includes approximately $365 million, $1,285 million, $5 million, $5 million, $0 million and $0 million for the remainder of 2023 through 2027 and thereafter, respectively, of joint obligations of NEECH and NEER. Insurance – Liability for accidents at nuclear power plants is governed by the Price-Anderson Act, which limits the liability of nuclear reactor owners to the amount of insurance available from both private sources and an industry retrospective payment plan. In accordance with this Act, NEE maintains $450 million of private liability insurance per site, which is the maximum obtainable, except at Duane Arnold which obtained an exemption from the NRC and maintains a $100 million private liability insurance limit. Each site, except Duane Arnold, participates in a secondary financial protection system, which provides up to $13.2 billion of liability insurance coverage per incident at any nuclear reactor in the U.S. Under the secondary financial protection system, NEE is subject to retrospective assessments of up to $963 million ($550 million for FPL), plus any applicable taxes, per incident at any nuclear reactor in the U.S., payable at a rate not to exceed $143 million ($82 million for FPL) per incident per year. NextEra Energy Resources and FPL are contractually entitled to recover a proportionate share of such assessments from the owners of minority interests in Seabrook and St. Lucie Unit No. 2, which approximates $16 million and $20 million, plus any applicable taxes, per incident, respectively. NEE participates in a nuclear insurance mutual company that provides $2.75 billion of limited insurance coverage per occurrence per site for property damage, decontamination and premature decommissioning risks at its nuclear plants and a sublimit of $1.5 billion for non-nuclear perils, except for Duane Arnold which has a limit of $50 million for property damage, decontamination risks and non-nuclear perils. NEE participates in co-insurance of 10% of the first $400 million of losses per site per occurrence, except at Duane Arnold. The proceeds from such insurance, however, must first be used for reactor stabilization and site decontamination before they can be used for plant repair. NEE also participates in an insurance program that provides limited coverage for replacement power costs if a nuclear plant is out of service for an extended period of time because of an accident. In the event of an accident at one of NEE's or another participating insured's nuclear plants, NEE could be assessed up to $158 million ($100 million for FPL), plus any applicable taxes, in retrospective premiums in a policy year. NextEra Energy Resources and FPL are contractually entitled to recover a proportionate share of such assessments from the owners of minority interests in Seabrook, Duane Arnold and St. Lucie Unit No. 2, which approximates $2 million, $2 million and $4 million, plus any applicable taxes, respectively. Due to the high cost and limited coverage available from third-party insurers, NEE does not have property insurance coverage for a substantial portion of either its transmission and distribution property or natural gas pipeline assets. If FPL's storm restoration costs exceed the storm reserve, such storm restoration costs may be recovered, subject to prudence review by the FPSC, through surcharges approved by the FPSC or through securitization provisions pursuant to Florida law. In the event of a loss, the amount of insurance available might not be adequate to cover property damage and other expenses incurred. Uninsured losses and other expenses, to the extent not recovered from customers in the case of FPL, would be borne by NEE and FPL and could have a material adverse effect on NEE's and FPL's financial condition, results of operations and liquidity. Legal Proceedings – FPL is the defendant in a purported class action lawsuit (Velez, et al. v. Florida Power & Light Company) filed in February 2018 that seeks from FPL unspecified damages for alleged breach of contract and gross negligence based on service interruptions that occurred as a result of Hurricane Irma in 2017. The trial of this matter is set for November 2023 in the Miami-Dade County Circuit Court. The trial court certified the case as a class action and FPL's appeal of that decision was denied by Florida's Third District Court of Appeal (3 rd DCA) in March 2023. FPL filed a motion on March 31, 2023, for rehearing with the 3 rd DCA claiming that the opinion upholding the class certification contains several errors that should be reheard by the full 3 rd DCA. The motion is pending. FPL does not believe that the plaintiffs’ claims should be meritorious on a class, individual or appellate basis, but management is unable to predict with certainty the outcome of the lawsuit.

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