Crisis and Challenge: 1973-1999
Managing crisis | Major changes | New nuclear plant | Award-winning performance | More challenges | A new "generation" of power plants | Growth beyond FPL's service area
"This country cannot be dependent upon foreign oil, or the day will come when the lights will go out."
Quote: FPL official, 1970s.
Gas supplies dried up and prices soared in the 1970s.
The 1970s challenged FPL in new ways. Management had to deal with
- the OPEC oil embargo, causing petroleum prices to rise from $4 a barrel in 1972 to more than $30 by 1981,
- FPL's dependency on oil for more than 50 percent of its generation
- a recession that gripped the nation with double-digit inflation and interest rates
- requesting FPL's first general rate increase in history in 1972, with other rate increases and denials of rate increases following,
- stalled construction projects and financial difficulties, and
- the national controversy over nuclear power after Three Mile Island.
FPL emerged from this time of crisis to make several important changes:
- Instead of promoting the use of electricity, FPL would focus on promoting the conservation of energy and become an industry leader in environmental performance.
- FPL Group, Inc., a new holding company, was formed in 1984. This enables the company to expand through the creation of new companies and the purchase or acquisition of existing ones.
- By converting some oil-fired units to natural gas, adding new nuclear units and contracting with neighboring utilities to purchase coal-fired power, oil dropped to 26 percent of FPL's generation by 1988.
New nuclear plant
In 1976, St. Lucie unit 1 went on line and in 1983, unit 2. Considering the times and circumstances, unit 2's completion in an industry-record six years was an amazing feat.
Through it all, FPL tackled the challenges and flourished, earning
- the Edison Electric Institute's prestigious Edison Award
- numerous accolades for its environmental programs
- acclaim for its innovative Quality Improvement Program and
- the Deming Prize in 1989 -the first non-Japanese company ever to capture the coveted quality award.
The 1989 Deming Prize.
FPL continued to face challenges in the 1990s:
- Sweeping federal initiatives to deregulate the utility industry create more energy choices for customers than ever before. Utilities that would prosper in this highly competitive environment would be those that delivered quality and reliable services at the lowest prices.
- FPL works to reduce costs and streamline its operation. Operations and maintenance expenses are reduced by 36 percent from 1990 through 1999.
- Hurricane Andrew, the nation's most costly natural disaster, strikes South Florida in 1992 causing extensive damage to FPL's system. Thousands of FPL employees, many victims of the storm, work tirelessly to restore electricity to 1.4 million homes and businesses in just over a month.
1992 Annual Report shows crews repairing lines damaged in Hurricane Andrew.
A new "generation" of power plants
State-of-the-art combined cycle units, an industry showcase for efficiency, entered service at the Martin plant in 1994 more than $100 million below budget.
The Fort Lauderdale plant, site of FPL's first power plant construction project in 1925, is repowered in the 1990s to nearly triple the plant's generating capacity.
Growth beyond FPL's service area
FPL Energy is formed in 1998 to manage FPL Group's growing interests in electricity markets outside FPL's service area. The subsidiary focuses on clean energy technologies and fuels such as
- natural gas
- solar and