FirstEnergy Corp.’s (FE - Analyst Report) operating wing Florida Power & Light (“FPL”) Company announced the successful conclusion of a string of operational tests on the first natural gas-powered combustion turbines at its Riviera Beach Next Generation Clean Energy Center.
The preliminary testing phase commenced in late Sep 2013 and involved a range of assessments as well as running the combustion turbine at 25 megawatts (MW) of electricity. The high-tech Riviera Beach facility has three combustion turbines.
Development work at the facility is still underway and on completion will have a generating capacity of up to 1,250 MW which will adequately serve FirstEnergy’s 250,000 customers by the first half of 2014.
FirstEnergy is using the first combustion turbine to carry out a series of steam pipe-cleaning activities to prepare the facility’s piping for full operation. At the moment, testing on the second combustion turbine is proceeding with the third turbine set for testing in November.
FirstEnergy spent over $1 billion for the cutting-edge infrastructure of the Riviera Beach Center. The facility will generate power using 33% less fuel per megawatt-hour and will have lower emissions than the previous plant, demolished in 2011.
The Riviera Beach Center employs combined-cycle natural gas technology which will contribute to substantial net savings for FirstEnergy’s customers. The facility’s operational lifespan is projected to be 30 years.
The project represents FirstEnergy’s strategy to steadily minimize its reliance on foreign fuel. The company’s modernization efforts are directed towards improvement of service reliability and offering competitive power rates. This move will certainly lead to customer retention as well as add more non-FPL customers.
FirstEnergy is gradually steering its investments to fuel-efficient power plants. In early 2013, its Cape Canaveral Next Generation Clean Energy Center came online and the company has already torn down its Port Everglades plant to build a new center to be open in 2016.
FirstEnergy’s conversion to natural gas cannot be better timed, as the current pulse in the U.S. market is increasingly in favor of clean energy.
The company has also been busy developing its transmission network to support its operations. In late August, it energized a 138 Kilovolt transmission line in Pennsylvania. We believe these steps will help keep FirstEnergy’s momentum steady.
However, coal still holds a major share of FirstEnergy’s generation. Strict environmental laws are forcing FirstEnergy to close down its coal plants which will impact the company’s operations. Currently, the company carries a Zacks Rank #3 (Hold).
However, other well-placed operators include Zacks Ranked #2 (Buy) Cleco Corp. (CNL - Snapshot Report), Ameren Corp. (AEE - Analyst Report) and Alliant Energy Corp. (LNT - Snapshot Report).