A staff report on a Florida Power & Light Co. (FPL) proposal to construct a 280-mile intrastate pipeline to move natural gas north to Bradford County from Palm Beach County, which was sent to the Florida Public Service Commission (PSC) Thursday, includes both a primary recommendation to approve the application and an alternative recommendation to deny it.

The PSC is scheduled to vote on FPL’s application in Tallahassee Oct. 6. Assuming regulatory approval, FPL has said the pipeline could be in service as early as 2014.

FPL filed its proposal for the $1.5 billion Florida EnergySecure Line in April (see Daily GPI, April 8). The 30-inch diameter pipeline’s initial capacity would be 600 MMcf/d. About two-thirds of that capacity would be used by the FPL Next Generation Clean Energy Centers at Cape Canaveral and Riviera Beach, where the existing facilities are being retrofitted from fuel oil to natural gas facilities to reduce emissions, FPL said. The remaining capacity would allow for a reserve margin to deliver fuel to FPL or others in the state, the utility said.

In its application FPL projected that the pipeline’s capacity would be expanded to 1.25 Bcf/d by 2030.

Commission staff issued opposing recommendations on seven issues, including the question of whether the pipeline is needed to improve or maintain gas delivery reliability and integrity within the state. Florida Gas Transmission (FGT), which has filed to intervene in the case, said in a filing that existing pipelines in the state provide sufficient capacity to meet projected demand for approximately eight to 10 years.

FPL proposed recovering costs associated with the pipeline through its electric utility rate base. The primary staff recommendation disagreed, while the alternative view agreed with FPL because “the primary purpose of the Florida EnergySecure Line is to provide natural gas to FPL’s electric generation plant.” The primary staff recommendation concluded that FPL should establish a separate entity to own and operate the pipeline, while the alternative said a separate entity would not be needed to protect ratepayers.

The primary and alternative staff recommendations also differed over whether the proposed pipeline would improve the economics of natural gas transmission in the state, whether the pipeline would be subject to PSC jurisdiction and whether it would provide the most cost-effective and reliable source of gas supply, transport and delivery.

©Copyright 2009Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.