Inside Clean Energy: A Dirty Scandal for a Clean Energy Leader

Source: By Dan Gearino, Inside Climate News • Posted: Sunday, August 7, 2022

A wave of revelations about Florida Power & Light begs a question of parent company NextEra Energy: Will a sullied reputation seep into its clean-energy efforts?

Power lines strung through the Florida Everglades. Credit: Michele Eve Sandberg/Corbis via Getty Images
Power lines strung through the Florida Everglades. Credit: Michele Eve Sandberg/Corbis via Getty Images

Florida’s largest utility has a lot of explaining to do after news organizations revealed some unseemly conduct.

The reports show that Florida Power & Light hired a political consulting firm that engaged in dirty tricks to harm or otherwise neutralize the company’s perceived opponents, including elected officials and journalists.

Some of this—like turning a news website into a mouthpiece for the utility or surveilling a newspaper columnist in the hopes of catching him doing something embarrassing—sounds like the stuff of conspiracy theories.

FPL has said it was not fully aware of what its consultant was doing, and it has cast doubt on some of the reporting. But the company is limited in what it can do to defend itself because of reams of evidence, in leaked emails and texts, showing that company executives were aware of at least some of what was happening.

I’m interested in what happened with FPL, but I’m also looking at whether this cascade of revelations could harm the utility’s parent company, NextEra Energy, which happens to be the largest generator of renewable energy in the United States, and maybe the world.

NextEra, also based in Florida, has become a giant by racking up profits from its regulated utility business at FPL and using that as a foundation to build wind, solar and battery projects across the United States and Canada. Other utilities have tried similar strategies, but none have done it on the scale of NextEra.

Last month, I attended a public hearing for a NextEra solar proposal in central Ohio, and I saw how several backers of the project talked about the company’s involvement as a good thing. (Here’s the hearing transcript.)

“I believe that NextEra is a respectable developer,” said Jeremy Welch, testifying at the hearing on behalf of a union that supports the project.

I also saw how opponents of renewable energy development rarely miss an opportunity to sow distrust in the developer, with talk of how wind or solar would be an eyesore and potentially harm property values. But nobody brought up FPL’s alleged skulduggery during the hearing.

I wonder if NextEra’s problems in Florida may eventually affect the perception of the company in other places. To help figure this out, I reached out to David Pomerantz, who makes a living investigating utility companies as executive director of the Energy and Policy Institute, a nonprofit watchdog organization.

He started by questioning my premise that NextEra has a good reputation while its subsidiary, FPL, has taken some serious hits. He pointed to some of NextEra’s conduct outside of Florida, like its opposition to a power line in Maine that would have delivered renewable energy from Canada and harmed the market for a nuclear plant co-owned by the company.

That said, he acknowledges there is a “cognitive dissonance” between NextEra’s status as a major player in the transition to renewable energy and FPL’s status as a utility that relies heavily on fossil fuels, with a reputation for fighting dirty in defending its interests.

FPL this year announced a plan it calls “Real Zero” to completely eliminate carbon emissions from its operations by 2045. One part of that is to convert gas-fired power plants to run on hydrogen. Pomerantz said the goal of moving to zero emissions is a very good one, but he questions the feasibility of using hydrogen as a major part of generating electricity.

To the larger question of NextEra’s public image, Pomerantz answers with a question:

“What happens when the company’s reputation as an unethical actor … extends to their clean energy efforts?” he asked. “If you are somebody who maybe is on the fence about whether a wind farm should come to your community, and you see all this about what NextEra has done—and it’s true, (the company) really has behaved terribly—then, does that make you more or less trustworthy of them?”

NextEra’s executives and shareholders have reason to worry, but it’s too soon to know how much. A lot will depend on how FPL conducts itself moving forward.

Last week, Seaport Global Securities downgraded NextEra’s stock from “buy” to “neutral,” citing concerns “about growing media scrutiny of FPL’s lobbying practices.” But NextEra’s stock price has risen since then, largely in reaction to Sen. Joe Manchin’s announcement he is supporting clean energy legislation, which is good news for companies developing wind, solar and batteries.

Contacted for a response, a NextEra spokesman did not address the issues at FPL or the potential for blowback for the parent company, but he did point to recent comments from Kirk Crews, NextEra’s chief financial officer. Crews said last month in a call with analysts that he is confident in the company’s long-term plan to continue increasing development of wind, solar and batteries.

We know about FPL’s actions thanks to reporting by the Orlando Sentinel, Miami Herald and The Florida Times-Union, some of it in partnership with the nonprofit Floodlight. I’m eager to see what’s yet to come, and whether it leads to changes in the way FPL does business.