New Business Model for FPL
Florida Power and Light is trying to increase its electric rates for 2010 and 2011. In the Article "FPL Should buy its Electricity from Home Owners", arguments were made against allowing FPL to increase or upgrade it nuclear plant capacities. We hope our state representatives in Florida do not approve such requests, for everyones sake.
FPL is a state regulated company that quotes in the stock market. It earned a profit of 9% on sales last year. But, company officers believes that "a fair profit" is at least 12%. FPL has created a "10 Year Power Plant Site Plan (2008-2017)" which provides us with the same business model they have been using, relying heavily on Nuclear, Natural Gas which they call "Clean Energy", and very little on Wind and Sun power in the state of Florida. Basically FPL is using the same, old, worn out business model they have used in the past, which will result in contamination, no improvements for Florida and no growth for the company. In order to achieve growth they are counting on population growth, rates hikes, and developing more areas to service.
BACKGROUND
Not allowing FPL to raise rates and canceling its permission to increase its nuclear capacity, may be a blessing in disguised, because it will force company officers to find better, more innovative ways to provide services, with less contamination and greater development for America. This brief, explores this situation and provides some ideas for developing a more glorious, larger, improved and beneficial FPL for the benefit of all of us. Of course I hope that the following analysis would be a dramatic improvement over FPL's 10 year (2008-2017) plan, which only gives us more of the same.
OPTIONS
FPL can react in either of two ways, if the company's proposal to increases nuclear capacity and customer billing rates was rejected. Then FPL can: 1. Fight and insist to get the nuclear capacity and rate increase as they proposed, or 2. Accept Florida's refusal, and develop a better business model in which Floridian solar capacity is considered above everything else.
If FPL insist on getting their way, they will use additional money to advertise and lobby as required to get politicians to authorize the rate hikes. This pressure will start before, during and after the Florida Power Service Commission gives their decision. Under this scenario, FPL will be allowed to increase its nuclear power capacity and increase rates to the minimum specified levels. However, the actual rate increase when it occurs, could be higher. Its justification will be to earn a "fair Profit", and FPL's thrust will be, to continue "as is" without any improvement. Under this scenario, the horizon looks dim for all of us, including the planet. The only ones winning are the FPL's staff, employees and investors. All others loose.
On the contrary, if FPL accepts Florida's refusal, then we all have a possibility of winning big time. FPL may study how to include the home owners as part of their Electricity Supply strategy.
COMMUNITY HUBS
Smart professionals working for FPL will be able to study how they can create, maintain and operate electrical grids to service "Community Hubs". These self sufficient electrical hubs, are comprised of homeowners that have installed solar equipment to harness the sun and generate electricity, which is returned to FPL for its placement. This business model now exists with Net Metering, but FPL does not like it because electricity is generated by its client base. Also, that the production of electricity by home owners has been meek, not developed and grown because of the lack of funding to install the equipment and acceptance from FPL.
This "Community Hub" business model would rest on the premise that Power generation expansion now rest on homeowners, and FPL would make a margin on every transaction. The hubs located in a community or a region, would service a critical mass of customers in that region. The hubs would manage, store, generate, and delivery electricity upon demand. Hubs would not necessarily need to be connected to each other. By not having them connected, we would not have the need to transport electricity hundreds of miles away, to another hub, thus saving in land, electrical grids, but may require the development of new electrical storage technology, to stabilize supply at each hub location. Today, FPL has more than 10,000 miles of lines in their grid.
This not so novel concept, uses solar power to generate electricity, distributes the energy production and places the burden for the investment on the homeowner, generates income for the home owner, reduces the investments FPL needs to do, will slowly unload over time central contaminating plants owned by FPL. The Community Hub concept will generate employment with equipment installation work, simplifies the electricity generating technology, will drive down the price of the solar equipment, places FPL in a favorable position to produce and supply the equipment, and provides FPL a business model they can take to implement in at least 130 poor countries in the world.
This business model inhibits the creation of monumental and dangerous plants not made in Florida, that encroach the environment when in operation, that use up land for electrical cables, power outages are easier circumvented and isolated to specific hubs, there is a greater community identification with the well being of company, it amplifies the recipients of the benefits of the new electric hubs. FPL may see their sales figures momentarily shrink as they decommission plants, because they are no longer the producer of electricity, but their profit margins figures will certainly improve above their 9% current levels. Nevertheless, FPL Sales figures will jump dramatically upward, if they make a move to go abroad.
INTERNATIONALIZATION OF FPL
Current FPL business model has no way to grow and it under attack by the needs to eliminate the production of green house gases and radioactive waste. It cannot become an International Business because they have no product nor service proposition appealing to other countries. No country in the world would allow FPL to enter with a centralized power generation system in which the population pays premium prices for its electricity forever.
However, with the community hub concept, and the development of Home Power Generator technology, all countries would welcome FPL. The company can also become a prime supplier of Solar technology for the Home. FPL would now turn to be the green proponent champion of the 21st century. All countries could electrify their projects as they move along. No high upstart cost in building huge plants, is required. Home Power Generator would be available for low reachable price, integrated and produced by FPL. Now, FPL's know how, size, financial strength, technology development capability, will be turn into helping mankind and the planet become sustainable. Now FPL's investors can have bona fide profits, morally and ethically earned, and the CEO and its employees are entitled to their salaries.
We hope Florida legislators are able to sort out the different interest groups and do what is best for the country and its people. May God guide them in their decision.
FPL is a state regulated company that quotes in the stock market. It earned a profit of 9% on sales last year. But, company officers believes that "a fair profit" is at least 12%. FPL has created a "10 Year Power Plant Site Plan (2008-2017)" which provides us with the same business model they have been using, relying heavily on Nuclear, Natural Gas which they call "Clean Energy", and very little on Wind and Sun power in the state of Florida. Basically FPL is using the same, old, worn out business model they have used in the past, which will result in contamination, no improvements for Florida and no growth for the company. In order to achieve growth they are counting on population growth, rates hikes, and developing more areas to service.
BACKGROUND
Not allowing FPL to raise rates and canceling its permission to increase its nuclear capacity, may be a blessing in disguised, because it will force company officers to find better, more innovative ways to provide services, with less contamination and greater development for America. This brief, explores this situation and provides some ideas for developing a more glorious, larger, improved and beneficial FPL for the benefit of all of us. Of course I hope that the following analysis would be a dramatic improvement over FPL's 10 year (2008-2017) plan, which only gives us more of the same.
OPTIONS
FPL can react in either of two ways, if the company's proposal to increases nuclear capacity and customer billing rates was rejected. Then FPL can: 1. Fight and insist to get the nuclear capacity and rate increase as they proposed, or 2. Accept Florida's refusal, and develop a better business model in which Floridian solar capacity is considered above everything else.
If FPL insist on getting their way, they will use additional money to advertise and lobby as required to get politicians to authorize the rate hikes. This pressure will start before, during and after the Florida Power Service Commission gives their decision. Under this scenario, FPL will be allowed to increase its nuclear power capacity and increase rates to the minimum specified levels. However, the actual rate increase when it occurs, could be higher. Its justification will be to earn a "fair Profit", and FPL's thrust will be, to continue "as is" without any improvement. Under this scenario, the horizon looks dim for all of us, including the planet. The only ones winning are the FPL's staff, employees and investors. All others loose.
On the contrary, if FPL accepts Florida's refusal, then we all have a possibility of winning big time. FPL may study how to include the home owners as part of their Electricity Supply strategy.
COMMUNITY HUBS
Smart professionals working for FPL will be able to study how they can create, maintain and operate electrical grids to service "Community Hubs". These self sufficient electrical hubs, are comprised of homeowners that have installed solar equipment to harness the sun and generate electricity, which is returned to FPL for its placement. This business model now exists with Net Metering, but FPL does not like it because electricity is generated by its client base. Also, that the production of electricity by home owners has been meek, not developed and grown because of the lack of funding to install the equipment and acceptance from FPL.
This "Community Hub" business model would rest on the premise that Power generation expansion now rest on homeowners, and FPL would make a margin on every transaction. The hubs located in a community or a region, would service a critical mass of customers in that region. The hubs would manage, store, generate, and delivery electricity upon demand. Hubs would not necessarily need to be connected to each other. By not having them connected, we would not have the need to transport electricity hundreds of miles away, to another hub, thus saving in land, electrical grids, but may require the development of new electrical storage technology, to stabilize supply at each hub location. Today, FPL has more than 10,000 miles of lines in their grid.
This not so novel concept, uses solar power to generate electricity, distributes the energy production and places the burden for the investment on the homeowner, generates income for the home owner, reduces the investments FPL needs to do, will slowly unload over time central contaminating plants owned by FPL. The Community Hub concept will generate employment with equipment installation work, simplifies the electricity generating technology, will drive down the price of the solar equipment, places FPL in a favorable position to produce and supply the equipment, and provides FPL a business model they can take to implement in at least 130 poor countries in the world.
This business model inhibits the creation of monumental and dangerous plants not made in Florida, that encroach the environment when in operation, that use up land for electrical cables, power outages are easier circumvented and isolated to specific hubs, there is a greater community identification with the well being of company, it amplifies the recipients of the benefits of the new electric hubs. FPL may see their sales figures momentarily shrink as they decommission plants, because they are no longer the producer of electricity, but their profit margins figures will certainly improve above their 9% current levels. Nevertheless, FPL Sales figures will jump dramatically upward, if they make a move to go abroad.
INTERNATIONALIZATION OF FPL
Current FPL business model has no way to grow and it under attack by the needs to eliminate the production of green house gases and radioactive waste. It cannot become an International Business because they have no product nor service proposition appealing to other countries. No country in the world would allow FPL to enter with a centralized power generation system in which the population pays premium prices for its electricity forever.
However, with the community hub concept, and the development of Home Power Generator technology, all countries would welcome FPL. The company can also become a prime supplier of Solar technology for the Home. FPL would now turn to be the green proponent champion of the 21st century. All countries could electrify their projects as they move along. No high upstart cost in building huge plants, is required. Home Power Generator would be available for low reachable price, integrated and produced by FPL. Now, FPL's know how, size, financial strength, technology development capability, will be turn into helping mankind and the planet become sustainable. Now FPL's investors can have bona fide profits, morally and ethically earned, and the CEO and its employees are entitled to their salaries.
We hope Florida legislators are able to sort out the different interest groups and do what is best for the country and its people. May God guide them in their decision.
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