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Source: Institute for Energy Economics and Financial Analysis

S&P Global Market Intelligence ($):

As part of NextEra Energy Inc.’s continued embrace of disruption in the utility sector, executives during the company’s investor day laid out a bullish view on pricing and demand for renewable power paired with storage through 2022.

The Florida-headquartered company estimates it will install between 20,000MW and 23,000MW of wind capacity and 9,000MW and 13,000MW of solar capacity by 2022, including assets owned and operated by competitive generation division NextEra Energy Resources LLC. Executives expect NextEra will have up to 2,000MW of storage deployed by then as well.

“There is enormous change coming in this industry. I don’t think the industry really has come to grips with it,” NextEra Energy Chairman, President and CEO Jim Robo said June 20. “And we’re at the leading edge, and it is going to help drive tremendous growth to this company over the next decade.”

According to Robo, the rapid growth of wind and solar in the market has been among the industry’s biggest game-changers, and one that almost everyone failed to recognize early on. While renewable tax credits might be extended, NextEra executives are betting wind and solar plus storage will be cheaper than existing coal and most existing nuclear after the early 2020s, when current federal subsidies are gone.

NextEra’s decarbonization strategy includes natural gas pipelines and gas-fired plants, including the Mountain Valley Pipeline LLC in which the company owns a stake, and Florida Power & Light Co.’s FPL Dania Beach Clean Energy Center. NextEra plans to deploy between $6.3 billion and $6.9 billion for gas pipelines by 2022. Robo said the opposition to gas is surprising, because gas pipelines have enabled coal plant shutdowns and large emission reductions.

However, the company takes a more bearish view on gas-fired peakers; NextEra Energy Resources President and CFO John Ketchum said management sees peakers being “cannibalized” by renewables, especially as battery storage’s manufacturing becomes more efficient and costs decline.

More ($): NextEra sees batteries displacing gas-fired peakers, otherwise bullish on gas

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