NextEra Energy has not yet faced serious headwinds over its mission to become the largest regulated utility in the world.
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But it should.
The parent company of Florida Power & Light — which in Central Florida serves parts of Seminole and Volusia and all of Brevard — announced a $66.8 billion merger with Dominion Energy, allowing its expansion into Virginia, North Carolina and South Carolina. It is part of “America’s golden age of power demand,” said NextEra CEO John Ketchum.
That may be the case in NextEra’s C-Suite. But in living rooms across Florida, the gold has mostly gone straight into NextEra’s pockets.
If Florida is any guide, customers in Dominion-serviced states should expect the higher rates and unwelcome political influence that FPL customers face, but on steroids. The merged company would not only be a mega-monopoly, Energy and Policy Institute Executive Director David Pomerantz told the New York Times. It would be “nearly impossible to regulate.”
A laundry list of abuses
That’s already the case in Florida.
Ticking off a laundry list of allegations in a civil suit brought by NextEra investors, 11th U.S. Circuit Court of Appeals Judge Gerald Bard Tjoflat cited “Corporate malfeasance, bribery, off-the-books recordkeeping, surveilling journalists, creating ‘ghost’ candidates, corrupting independent media outlets, and a failed acquisition that spiraled into two federal indictments.” A lot of that documentation flowed from the Orlando Sentinel’s investigation that uncovered a flow underground money in the 2020 election, a trail that eventually led to FPL.
The plaintiff investors are not Wall Street titans. They are pension funds for Hollywood police and Pembroke Pines police and firefighters.
That NextEra could rack up a string of scandals and still extract multi-billion-dollar rate hikes for FPL stems directly from weak-kneed, inept oversight by the Florida Public Service Commission.
NextEra’s ambition and the PSC’s capitulation have already broken a much older business deal than the merger. It is the basis for any state-sanctioned monopoly.
A captive customer base
In this case, Florida allowed FPL to become an exclusive provider in a given region. FPL reaps the economic advantages of a captive consumer base and a guaranteed cash flow.
In return, FPL agreed to regulation by the PSC, including rate hikes. Regulators are expected to balance the best interests of consumers with the utility’s business needs. It’s not working.
When lawmakers asked the PSC to audit FPL to ensure that electric bills weren’t funding political schemes, the PSC just said no. When FPL poured millions into a campaign to limit rooftop solar growth and wrote a bill discouraging solar investment, it was not a PSC concern.
Profit-making blessed by the PSC has enabled NextEra to shower politicians and projects with campaign cash. NextEra is listed as one of Donald Trump’s early ballroom donors.
In 2021, the PSC took just one hour to approve a rate hike that would cost customers $4.86 billion over five years. Last year, the PSC appeared to ignore any staff recommendations in awarding a $6.9 billion rate hike that the state public counsel termed “unconscionable.” Tucked into the deal was permission for the highest profit margins in 48 states.
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Crucially, the PSC-blessed package also allows owners of electricity-guzzling data centers to pay 70% of their anticipated energy costs instead of the originally proposed 90%. Customers will pick up the tab for the rest.
It’s a key issue. The NextEra merger is based on predictions that data centers will usher in decades of high electricity demand to fuel AI.
It’s a remarkably short-sighted read. Hyperscale data centers needed for AI face backlash across the country. At least $64 billion in projects have been blocked or delayed, according to Data Center Watch. Palm Beach County’s Project Tango data center may be next.
Much cause for concern
Angry residents have already forced a delay on the final vote.
Their concerns are legitimate. In February, electricity rates nationally were 9% higher than the year before.
In Virginia’s “Data Center Alley,” costs shot up by 26.3%. NextEra will need approval from Virginia, South and North Carolina to complete the merger. But Virginia Gov. Abigail Spanberger successfully campaigned on reining in data centers and higher electric bills.
Opposition to data centers is gathering steam in North Carolina. And South Carolina Rep. Nancy Mace wants a one-year freeze on data center construction there.
Gov. Ron. DeSantis correctly tried to rein in data centers with an AI Bill of Rights in the 2026 regular legislative session. It would have ensured data centers footed their own electric bills.
But lawmakers who chafed at being pushed around by the inflexible governor’s demands for the past eight years found their backbone just in time to do the wrong thing. The legislation died.
A few weeks after the $6.9 billion rate hike, a NextEra affiliate put $250,000 into a DeSantis political action committee, according to the independent news site Seeking Rents.
It’s possible that regulators in other states will do a better job of protecting consumers, that politicians there will be less swayed by campaign money and that NextEra and FPL have put scandals in the rearview mirror.
But before their utility regulators roll out the welcome mat, they should take a close look at how NextEra does business in its backyard.
The Orlando Sentinel Editorial Board includes Executive Editor Roger Simmons, Opinion Editor Krys Fluker and Viewpoints Editor Jay Reddick. The Sun Sentinel Editorial Board consists of Executive Editor Gretchen Day-Bryant, Editorial Page Editor Steve Bousquet, Deputy Editorial Page Editor Dan Sweeney and editorial writers Pat Beall and Martin Dyckman. Send letters to [email protected].
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