NextEra’s FPL provides details of previously announced rate settlement

According to a regulatory filing, on August 20, 2025, NextEra Energy’s (NEE) Florida Power & Light Company and ten of the 13 intervenor groups in FPL’s base rate proceeding filed with the Florida Public Service Commission a joint motion requesting that the FPSC approve a stipulation and settlement agreement signed by those parties that would resolve all matters in FPL’s pending base rate proceeding. Key elements of the proposed 2025 rate agreement, which would be effective from January 2026 through at least December 2029, include the following: New retail base rates and charges would be established resulting in the following increases in annualized retail base revenues of $945M beginning January 1, 2026 and $705M beginning January 1, 2027. In addition, FPL would receive, subject to conditions specified in the proposed 2025 rate agreement, base rate increases associated with solar generation projects that enter service in 2027, 2028, and 2029 and battery storage projects that enter service in 2028 and 2029 through a Solar and Battery Base Rate Adjustment (SoBRA) mechanism. FPL would be required to demonstrate either a specified economic or resource/reliability need for these projects. FPL’s authorized regulatory return on common equity (regulatory ROE) would be 10.95%, with a range of 9.95% to 11.95%. If FPL’s earned regulatory ROE were to fall below 9.95%, FPL could seek retail base rate relief. If the earned regulatory ROE were to rise above 11.95%, any party with standing could seek a review of FPL’s retail base rates; FPL’s authorized regulatory capital structure would reflect a 59.6% equity ratio, consistent with prior base rate cases. FPL would be authorized to implement a rate stabilization mechanism (RSM) over the term of the proposed 2025 rate agreement that would be comprised of: 1) up to $1.155B of certain deferred tax liabilities related to repairs and mixed service costs, 2) any balance remaining related to FPL’s existing reserve amortization mechanism as of January 1, 2026, and 3) investment tax credit amortization associated with certain battery storage projects that will go into service in 2025 (collectively, the RSM reserve). Subject to certain conditions, FPL could amortize the RSM reserve over the term of the proposed 2025 rate agreement, provided that in any year of the proposed 2025 rate agreement FPL would be required to amortize at least enough RSM reserve amount to maintain its minimum authorized regulatory ROE and also could not amortize any RSM reserve amount that would result in an earned regulatory ROE in excess of its maximum authorized regulatory ROE. In addition, FPL would recognize in base rates the customers’ share of the gains generated through the asset optimization program, previously approved by the FPSC, in the month in which the gains are generated, and 100% of any annual gains in excess of $150M would be provided to customers through the fuel cost recovery clause. Future storm restoration costs would continue to be recoverable on an interim basis beginning 60 days from the filing of a cost recovery petition, but capped at an amount that produces a surcharge of no more than $5 for every 1,000 kilowatt-hours of usage on residential bills during the first 12 months of cost recovery. Any additional costs would be eligible for recovery in subsequent years. If storm restoration costs, inclusive of the costs to replenish the storm reserve, exceed the cap, FPL could request an increase to the $5 surcharge. If federal or state permanent corporate income tax changes become effective during the term of the proposed 2025 rate agreement, FPL would be able to prospectively adjust base rates after a review by the FPSC. FPL would be permitted to implement tariffs for large load customers with new or incremental load of 50 megawatts or greater and with a load factor of at least 85%.