Document
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2016

Commission
File
Number
 
Exact name of registrants as specified in their
charters, address of principal executive offices and
registrants' telephone number
 
IRS Employer
Identification
Number
1-8841
 
NEXTERA ENERGY, INC.
 
59-2449419
2-27612
 
FLORIDA POWER & LIGHT COMPANY
 
59-0247775
 
 
700 Universe Boulevard
Juno Beach, Florida 33408
(561) 694-4000
 
 

State or other jurisdiction of incorporation or organization:  Florida

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) have been subject to such filing requirements for the past 90 days.
NextEra Energy, Inc.    Yes þ    No ¨                                                                     Florida Power & Light Company    Yes þ    No ¨

Indicate by check mark whether the registrants have submitted electronically and posted on their corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months.
NextEra Energy, Inc.    Yes þ    No ¨                                                                     Florida Power & Light Company    Yes þ    No ¨

Indicate by check mark whether the registrants are a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Securities Exchange Act of 1934.
NextEra Energy, Inc.
Large Accelerated Filer þ
Accelerated Filer ¨
Non-Accelerated Filer ¨
Smaller Reporting Company ¨
Florida Power & Light Company
Large Accelerated Filer ¨
Accelerated Filer ¨
Non-Accelerated Filer þ
Smaller Reporting Company ¨

Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).   Yes ¨   No þ

Number of shares of NextEra Energy, Inc. common stock, $0.01 par value, outstanding as of September 30, 2016467,267,977

Number of shares of Florida Power & Light Company common stock, without par value, outstanding as of September 30, 2016, all of which were held, beneficially and of record, by NextEra Energy, Inc.: 1,000

This combined Form 10-Q represents separate filings by NextEra Energy, Inc. and Florida Power & Light Company. Information contained herein relating to an individual registrant is filed by that registrant on its own behalf. Florida Power & Light Company makes no representations as to the information relating to NextEra Energy, Inc.'s other operations.

Florida Power & Light Company meets the conditions set forth in General Instruction H.(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format.



DEFINITIONS

Acronyms and defined terms used in the text include the following:

Term
Meaning
AFUDC
allowance for funds used during construction
AFUDC - equity
equity component of AFUDC
AOCI
accumulated other comprehensive income
capacity clause
capacity cost recovery clause, as established by the FPSC
Duane Arnold
Duane Arnold Energy Center
EPA
U.S. Environmental Protection Agency
FASB
Financial Accounting Standards Board
FERC
U.S. Federal Energy Regulatory Commission
Florida Southeast Connection
Florida Southeast Connection, LLC, a wholly owned NEER subsidiary
FPL
Florida Power & Light Company
FPL FiberNet
fiber-optic telecommunications business
FPSC
Florida Public Service Commission
fuel clause
fuel and purchased power cost recovery clause, as established by the FPSC
GAAP
generally accepted accounting principles in the U.S.
ITC
investment tax credit
kWh
kilowatt-hour(s)
Management's Discussion
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
MMBtu
One million British thermal units
MW
megawatt(s)
MWh
megawatt-hour(s)
NEE
NextEra Energy, Inc.
NEECH
NextEra Energy Capital Holdings, Inc.
NEER
NextEra Energy Resources, LLC
NEET
NextEra Energy Transmission, LLC
NEP
NextEra Energy Partners, LP
NEP OpCo
NextEra Energy Operating Partners, LP
Note __
Note __ to condensed consolidated financial statements
NRC
U.S. Nuclear Regulatory Commission
O&M expenses
other operations and maintenance expenses in the condensed consolidated statements of income
OCI
other comprehensive income
OTC
over-the-counter
OTTI
other than temporary impairment
PTC
production tax credit
PV
photovoltaic
Recovery Act
American Recovery and Reinvestment Act of 2009, as amended
regulatory ROE
return on common equity as determined for regulatory purposes
Sabal Trail
Sabal Trail Transmission, LLC, an entity in which a wholly owned NEER subsidiary has a 42.5% ownership interest
Seabrook
Seabrook Station
SEC
U.S. Securities and Exchange Commission
U.S.
United States of America

NEE, FPL, NEECH and NEER each has subsidiaries and affiliates with names that may include NextEra Energy, FPL, NextEra Energy Resources, NextEra, FPL Group, FPL Group Capital, FPL Energy, FPLE and similar references. For convenience and simplicity, in this report the terms NEE, FPL, NEECH and NEER are sometimes used as abbreviated references to specific subsidiaries, affiliates or groups of subsidiaries or affiliates. The precise meaning depends on the context.

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TABLE OF CONTENTS


 
 
Page No.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 



3


FORWARD-LOOKING STATEMENTS

This report includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions, strategies, future events or performance (often, but not always, through the use of words or phrases such as may result, are expected to, will continue, is anticipated, aim, believe, will, could, should, would, estimated, may, plan, potential, future, projection, goals, target, outlook, predict and intend or words of similar meaning) are not statements of historical facts and may be forward looking. Forward-looking statements involve estimates, assumptions and uncertainties. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following important factors (in addition to any assumptions and other factors referred to specifically in connection with such forward-looking statements) that could have a significant impact on NEE's and/or FPL's operations and financial results, and could cause NEE's and/or FPL's actual results to differ materially from those contained or implied in forward-looking statements made by or on behalf of NEE and/or FPL in this combined Form 10-Q, in presentations, on their respective websites, in response to questions or otherwise.

Regulatory, Legislative and Legal Risks
NEE's and FPL's business, financial condition, results of operations and prospects may be materially adversely affected by the extensive regulation of their business.
NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected if they are unable to recover in a timely manner any significant amount of costs, a return on certain assets or a reasonable return on invested capital through base rates, cost recovery clauses, other regulatory mechanisms or otherwise.
Regulatory decisions that are important to NEE and FPL may be materially adversely affected by political, regulatory and economic factors.
FPL's use of derivative instruments could be subject to prudence challenges and, if found imprudent, could result in disallowances of cost recovery for such use by the FPSC.
Any reductions to, or the elimination of, governmental incentives or policies that support utility scale renewable energy, including, but not limited to, tax incentives, renewable portfolio standards, feed-in tariffs or the EPA's final rule under Section 111(d) of the Clean Air Act, or the imposition of additional taxes or other assessments on renewable energy, could result in, among other items, the lack of a satisfactory market for the development of new renewable energy projects, NEER abandoning the development of renewable energy projects, a loss of NEER's investments in renewable energy projects and reduced project returns, any of which could have a material adverse effect on NEE's business, financial condition, results of operations and prospects.
NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected as a result of new or revised laws, regulations, interpretations or other regulatory initiatives.
NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected if the rules implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act broaden the scope of its provisions regarding the regulation of OTC financial derivatives and make certain provisions applicable to NEE and FPL.
NEE and FPL are subject to numerous environmental laws, regulations and other standards that may result in capital expenditures, increased operating costs and various liabilities, and may require NEE and FPL to limit or eliminate certain operations.
NEE's and FPL's business could be negatively affected by federal or state laws or regulations mandating new or additional limits on the production of greenhouse gas emissions.
Extensive federal regulation of the operations of NEE and FPL exposes NEE and FPL to significant and increasing compliance costs and may also expose them to substantial monetary penalties and other sanctions for compliance failures.
Changes in tax laws, as well as judgments and estimates used in the determination of tax-related asset and liability amounts, could materially adversely affect NEE's and FPL's business, financial condition, results of operations and prospects.
NEE's and FPL's business, financial condition, results of operations and prospects may be materially adversely affected due to adverse results of litigation.
Operational Risks
NEE's and FPL's business, financial condition, results of operations and prospects could suffer if NEE and FPL do not proceed with projects under development or are unable to complete the construction of, or capital improvements to, electric generation, transmission and distribution facilities, gas infrastructure facilities or other facilities on schedule or within budget.
NEE and FPL may face risks related to project siting, financing, construction, permitting, governmental approvals and the negotiation of project development agreements that may impede their development and operating activities.

4


The operation and maintenance of NEE's and FPL's electric generation, transmission and distribution facilities, gas infrastructure facilities and other facilities are subject to many operational risks, the consequences of which could have a material adverse effect on NEE's and FPL's business, financial condition, results of operations and prospects.
NEE's and FPL's business, financial condition, results of operations and prospects may be negatively affected by a lack of growth or slower growth in the number of customers or in customer usage.
NEE's and FPL's business, financial condition, results of operations and prospects can be materially adversely affected by weather conditions, including, but not limited to, the impact of severe weather.
Threats of terrorism and catastrophic events that could result from terrorism, cyber attacks, or individuals and/or groups attempting to disrupt NEE's and FPL's business, or the businesses of third parties, may materially adversely affect NEE's and FPL's business, financial condition, results of operations and prospects.
The ability of NEE and FPL to obtain insurance and the terms of any available insurance coverage could be materially adversely affected by international, national, state or local events and company-specific events, as well as the financial condition of insurers. NEE's and FPL's insurance coverage does not provide protection against all significant losses.
NEE invests in gas and oil producing and transmission assets through NEER’s gas infrastructure business. The gas infrastructure business is exposed to fluctuating market prices of natural gas, natural gas liquids, oil and other energy commodities. A prolonged period of low gas and oil prices could impact NEER’s gas infrastructure business and cause NEER to delay or cancel certain gas infrastructure projects and for certain existing projects to be impaired, which could materially adversely affect NEE's results of operations.
If supply costs necessary to provide NEER's full energy and capacity requirement services are not favorable, operating costs could increase and materially adversely affect NEE's business, financial condition, results of operations and prospects.
Due to the potential for significant volatility in market prices for fuel, electricity and renewable and other energy commodities, NEER's inability or failure to manage properly or hedge effectively the commodity risks within its portfolios could materially adversely affect NEE's business, financial condition, results of operations and prospects.
Sales of power on the spot market or on a short-term contractual basis may cause NEE's results of operations to be volatile.
Reductions in the liquidity of energy markets may restrict the ability of NEE to manage its operational risks, which, in turn, could negatively affect NEE's results of operations.
NEE's and FPL's hedging and trading procedures and associated risk management tools may not protect against significant losses.
If price movements significantly or persistently deviate from historical behavior, NEE's and FPL's risk management tools associated with their hedging and trading procedures may not protect against significant losses.
If power transmission or natural gas, nuclear fuel or other commodity transportation facilities are unavailable or disrupted, FPL's and NEER's ability to sell and deliver power or natural gas may be limited.
NEE and FPL are subject to credit and performance risk from customers, hedging counterparties and vendors.
NEE and FPL could recognize financial losses or a reduction in operating cash flows if a counterparty fails to perform or make payments in accordance with the terms of derivative contracts or if NEE or FPL is required to post margin cash collateral under derivative contracts.
NEE and FPL are highly dependent on sensitive and complex information technology systems, and any failure or breach of those systems could have a material adverse effect on their business, financial condition, results of operations and prospects.
NEE's and FPL's retail businesses are subject to the risk that sensitive customer data may be compromised, which could result in a material adverse impact to their reputation and/or the results of operations of the retail business.
NEE and FPL could recognize financial losses as a result of volatility in the market values of derivative instruments and limited liquidity in OTC markets.
NEE and FPL may be materially adversely affected by negative publicity.
NEE's and FPL's business, financial condition, results of operations and prospects may be materially adversely affected if FPL is unable to maintain, negotiate or renegotiate franchise agreements on acceptable terms with municipalities and counties in Florida.
Increasing costs associated with health care plans may materially adversely affect NEE's and FPL's results of operations.
NEE's and FPL's business, financial condition, results of operations and prospects could be negatively affected by the lack of a qualified workforce or the loss or retirement of key employees.
NEE's and FPL's business, financial condition, results of operations and prospects could be materially adversely affected by work strikes or stoppages and increasing personnel costs.

5


NEE's ability to successfully identify, complete and integrate acquisitions is subject to significant risks, including, but not limited to, the effect of increased competition for acquisitions resulting from the consolidation of the power industry.
NEP’s acquisitions may not be completed and, even if completed, NEE may not realize the anticipated benefits of any acquisitions, which could materially adversely affect NEE’s business, financial condition, results of operations and prospects.
Nuclear Generation Risks
The construction, operation and maintenance of NEER's and FPL's nuclear generation facilities involve environmental, health and financial risks that could result in fines or the closure of the facilities and in increased costs and capital expenditures.
In the event of an incident at any nuclear generation facility in the U.S. or at certain nuclear generation facilities in Europe, NEE and FPL could be assessed significant retrospective assessments and/or retrospective insurance premiums as a result of their participation in a secondary financial protection system and nuclear insurance mutual companies.
NRC orders or new regulations related to increased security measures and any future safety requirements promulgated by the NRC could require NEE and FPL to incur substantial operating and capital expenditures at their nuclear generation facilities.
The inability to operate any of NEER's or FPL's nuclear generation units through the end of their respective operating licenses could have a material adverse effect on NEE's and FPL's business, financial condition, results of operations and prospects.
Various hazards posed to nuclear generation facilities, along with increased public attention to and awareness of such hazards, could result in increased nuclear licensing or compliance costs which are difficult or impossible to predict and could have a material adverse effect on NEE's and FPL's business, financial condition, results of operations and prospects.
NEER's and FPL's nuclear units are periodically removed from service to accommodate normal refueling and maintenance outages, and for other purposes. If planned outages last longer than anticipated or if there are unplanned outages, NEE's and FPL's results of operations and financial condition could be materially adversely affected.
Liquidity, Capital Requirements and Common Stock Risks
Disruptions, uncertainty or volatility in the credit and capital markets may negatively affect NEE's and FPL's ability to fund their liquidity and capital needs and to meet their growth objectives, and can also materially adversely affect the results of operations and financial condition of NEE and FPL.
NEE's, NEECH's and FPL's inability to maintain their current credit ratings may materially adversely affect NEE's and FPL's liquidity and results of operations, limit the ability of NEE and FPL to grow their business, and increase interest costs.
NEE's and FPL's liquidity may be impaired if their credit providers are unable to fund their credit commitments to the companies or to maintain their current credit ratings.
Poor market performance and other economic factors could affect NEE's defined benefit pension plan's funded status, which may materially adversely affect NEE's and FPL's business, financial condition, liquidity and results of operations and prospects.
Poor market performance and other economic factors could adversely affect the asset values of NEE's and FPL's nuclear decommissioning funds, which may materially adversely affect NEE's and FPL's liquidity and results of operations.
Certain of NEE's investments are subject to changes in market value and other risks, which may materially adversely affect NEE's liquidity, financial results and results of operations.
NEE may be unable to meet its ongoing and future financial obligations and to pay dividends on its common stock if its subsidiaries are unable to pay upstream dividends or repay funds to NEE.
NEE may be unable to meet its ongoing and future financial obligations and to pay dividends on its common stock if NEE is required to perform under guarantees of obligations of its subsidiaries.
NEP may not be able to access sources of capital on commercially reasonable terms, which would have a material adverse effect on its ability to consummate future acquisitions and on the value of NEE’s limited partner interest in NEP OpCo.
Disruptions, uncertainty or volatility in the credit and capital markets may exert downward pressure on the market price of NEE's common stock.

These factors should be read together with the risk factors included in Part I, Item 1A. Risk Factors in NEE's and FPL's Annual Report on Form 10-K for the year ended December 31, 2015 (2015 Form 10-K), and investors should refer to that section of the 2015 Form 10-K. Any forward-looking statement speaks only as of the date on which such statement is made, and NEE and FPL undertake no obligation to update any forward-looking statement to reflect events or circumstances, including, but not limited to, unanticipated events, after the date on which such statement is made, unless otherwise required by law. New factors emerge from time to time and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on

6


the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained or implied in any forward-looking statement.

Website Access to SEC Filings. NEE and FPL make their SEC filings, including the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, available free of charge on NEE's internet website, www.nexteraenergy.com, as soon as reasonably practicable after those documents are electronically filed with or furnished to the SEC. The information and materials available on NEE's website (or any of its subsidiaries' websites) are not incorporated by reference into this combined Form 10-Q. The SEC maintains an internet website that contains reports, proxy and information statements, and other information regarding registrants that file electronically with the SEC at www.sec.gov.

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PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements
NEXTERA ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(millions, except per share amounts)
(unaudited)

 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
 
2016
 
2015
 
2016
 
2015
OPERATING REVENUES
 
$
4,805

 
$
4,954

 
$
12,457

 
$
13,417

OPERATING EXPENSES
 
 
 
 
 
 
 
 
Fuel, purchased power and interchange
 
1,217

 
1,472

 
3,105

 
4,151

Other operations and maintenance
 
833

 
819

 
2,474

 
2,353

Merger-related
 
123

 
7

 
129

 
20

Depreciation and amortization
 
983

 
798

 
2,262

 
2,082

Taxes other than income taxes and other - net
 
370

 
377

 
805

 
1,054

Total operating expenses
 
3,526

 
3,473

 
8,775

 
9,660

OPERATING INCOME
 
1,279

 
1,481

 
3,682

 
3,757

OTHER INCOME (DEDUCTIONS)
 
 
 
 
 
 
 
 
Interest expense
 
(369
)
 
(311
)
 
(1,480
)
 
(912
)
Benefits associated with differential membership interests - net
 
59

 
40

 
220

 
151

Equity in earnings of equity method investees
 
70

 
51

 
147

 
87

Allowance for equity funds used during construction
 
20

 
20

 
62

 
48

Interest income
 
23

 
22

 
61

 
65

Gains on disposal of assets - net
 
9

 
15

 
36

 
42

Other than temporary impairment losses on securities held in nuclear decommissioning funds
 
(2
)
 
(24
)
 
(19
)
 
(32
)
Revaluation of contingent consideration
 
101

 

 
118

 

Other - net
 
17

 
8

 
40

 
27

Total other deductions - net
 
(72
)
 
(179
)
 
(815
)
 
(524
)
INCOME BEFORE INCOME TAXES
 
1,207

 
1,302

 
2,867

 
3,233

INCOME TAXES
 
418

 
421

 
879

 
981

NET INCOME
 
789

 
881

 
1,988

 
2,252

LESS NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS
 
36


2


42


7

NET INCOME ATTRIBUTABLE TO NEE
 
$
753

 
$
879

 
$
1,946


$
2,245

Earnings per share attributable to NEE:
 
 
 
 
 
 
 
 
Basic
 
$
1.63

 
$
1.94

 
$
4.21

 
$
5.02

Assuming dilution
 
$
1.62

 
$
1.93

 
$
4.19

 
$
4.97

Dividends per share of common stock
 
$
0.87

 
$
0.77

 
$
2.61

 
$
2.31

Weighted-average number of common shares outstanding:
 
 
 
 
 
 
 
 
Basic
 
463.3

 
454.1

 
461.7

 
447.3

Assuming dilution
 
466.0

 
456.0

 
464.7

 
451.3













This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

8




NEXTERA ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(millions)
(unaudited)

 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2016
 
2015
 
2016
 
2015
NET INCOME
$
789

 
$
881

 
$
1,988

 
$
2,252

OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX
 
 
 
 
 
 
 
Net unrealized gains (losses) on cash flow hedges:
 

 
 

 
 

 
 

Effective portion of net unrealized losses (net of $55 and $55 tax benefit, respectively)

 
(97
)
 

 
(107
)
Reclassification from accumulated other comprehensive loss to net income (net of $3, less than $1, $26 and $16 tax expense, respectively)
17

 
11

 
53

 
50

Net unrealized gains (losses) on available for sale securities:
 

 
 

 
 

 
 

Net unrealized gains (losses) on securities still held (net of $23 tax expense, $30 tax benefit, $42 tax expense and $26 tax benefit, respectively)
31

 
(38
)
 
56

 
(33
)
Reclassification from accumulated other comprehensive loss to net income (net of $2, $7, $6 and $16 tax benefit, respectively)
(2
)
 
(8
)
 
(8
)
 
(21
)
Defined benefit pension and other benefits plans (net of $4 and $10 tax benefit, respectively)

 

 
(7
)
 
(16
)
Net unrealized gains (losses) on foreign currency translation (net of $1 tax expense, $21, $2 and $4 tax benefit, respectively)
(9
)
 
(33
)
 
19

 
(5
)
Other comprehensive income (loss) related to equity method investee (net of $0, $2, $3 and $1 tax benefit, respectively)
3

 
(3
)
 
(1
)
 
(2
)
Total other comprehensive income (loss), net of tax
40

 
(168
)
 
112

 
(134
)
COMPREHENSIVE INCOME
829

 
713

 
2,100

 
2,118

LESS COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTERESTS
30

 
(1
)
 
22

 
1

COMPREHENSIVE INCOME ATTRIBUTABLE TO NEE
$
799

 
$
714

 
$
2,078

 
$
2,117























This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

9


NEXTERA ENERGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(millions, except par value)
(unaudited)
 
 
September 30,
2016
 
December 31,
2015
PROPERTY, PLANT AND EQUIPMENT
 
 
 
 
Electric plant in service and other property
 
$
76,559

 
$
72,606

Nuclear fuel
 
2,154

 
2,067

Construction work in progress
 
7,150

 
5,657

Accumulated depreciation and amortization
 
(20,246
)
 
(18,944
)
Total property, plant and equipment - net ($12,331 and $7,966 related to VIEs, respectively)
 
65,617

 
61,386

CURRENT ASSETS
 
 

 
 

Cash and cash equivalents
 
681

 
571

Customer receivables, net of allowances of $13 and $13, respectively
 
1,921

 
1,784

Other receivables
 
938

 
481

Materials, supplies and fossil fuel inventory
 
1,309

 
1,259

Regulatory assets:
 
 
 
 
Derivatives
 

 
218

Other
 
301

 
285

Derivatives
 
612

 
712

Assets held for sale
 
526

 
1,009

Other
 
459

 
476

Total current assets
 
6,747

 
6,795

OTHER ASSETS
 
 

 
 

Special use funds
 
5,450

 
5,138

Other investments ($483 related to a VIE at September 30, 2016)
 
2,380

 
1,786

Prepaid benefit costs
 
1,225

 
1,155

Regulatory assets:
 
 

 
 

Purchased power agreement termination
 
658

 
726

Other ($84 and $128 related to a VIE, respectively)
 
1,114

 
1,052

Derivatives
 
1,394

 
1,202

Other
 
3,279

 
3,239

Total other assets
 
15,500

 
14,298

TOTAL ASSETS
 
$
87,864

 
$
82,479

CAPITALIZATION
 
 

 
 

Common stock ($0.01 par value, authorized shares - 800; outstanding shares - 467 and 461, respectively)
 
$
5

 
$
5

Additional paid-in capital
 
9,039

 
8,596

Retained earnings
 
14,899

 
14,140

Accumulated other comprehensive loss
 
(36
)
 
(167
)
Total common shareholders' equity
 
23,907

 
22,574

Noncontrolling interests
 
962

 
538

Total equity
 
24,869

 
23,112

Long-term debt ($5,368 and $684 related to VIEs, respectively)
 
28,195

 
26,681

Total capitalization
 
53,064

 
49,793

CURRENT LIABILITIES
 
 

 
 

Commercial paper
 
628

 
374

Notes payable
 
490

 
412

Current maturities of long-term debt
 
2,364

 
2,220

Accounts payable
 
2,800

 
2,529

Customer deposits
 
469

 
473

Accrued interest and taxes
 
861

 
449

Derivatives
 
377

 
882

Accrued construction-related expenditures
 
781

 
921

Liabilities associated with assets held for sale
 
456

 
992

Other
 
1,230

 
855

Total current liabilities
 
10,456

 
10,107

OTHER LIABILITIES AND DEFERRED CREDITS
 
 

 
 

Asset retirement obligations
 
2,637

 
2,469

Deferred income taxes
 
10,582

 
9,827

Regulatory liabilities:
 
 

 
 

Accrued asset removal costs
 
1,940

 
1,930

Asset retirement obligation regulatory expense difference
 
2,290

 
2,182

Other
 
507

 
494

Derivatives
 
999

 
530

Deferral related to differential membership interests - VIEs
 
3,274

 
3,142

Other
 
2,115

 
2,005

Total other liabilities and deferred credits
 
24,344

 
22,579

COMMITMENTS AND CONTINGENCIES
 


 


TOTAL CAPITALIZATION AND LIABILITIES
 
$
87,864

 
$
82,479

This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

10




NEXTERA ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(millions)
(unaudited)
 
 
Nine Months Ended 
 September 30,
 
 
2016
 
2015
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
Net income
 
$
1,988

 
$
2,252

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 
 
 
Depreciation and amortization
 
2,262

 
2,082

Nuclear fuel and other amortization
 
275

 
280

Unrealized losses (gains) on marked to market derivative contracts - net
 
369

 
(393
)
Foreign currency transaction losses
 
99

 

Deferred income taxes
 
766

 
848

Cost recovery clauses and franchise fees
 
111

 
114

Purchased power agreement termination
 

 
(521
)
Benefits associated with differential membership interests - net
 
(220
)
 
(151
)
Allowance for equity funds used during construction
 
(62
)
 
(48
)
Gains on sale and disposal of assets - net
 
(291
)
 
(39
)
Other - net
 
(116
)
 
133

Changes in operating assets and liabilities:
 
 
 
 
Customer and other receivables
 
(150
)
 
(123
)
Materials, supplies and fossil fuel inventory
 
(59
)
 
(52
)
Other current assets
 
5

 
(56
)
Other assets
 
(17
)
 
(28
)
Accounts payable and customer deposits
 
54

 
(131
)
Margin cash collateral
 
(142
)
 
(79
)
Income taxes
 
48

 
45

Interest and other taxes
 
384

 
386

Other current liabilities
 
18

 
83

Other liabilities
 
(28
)
 
(89
)
Net cash provided by operating activities
 
5,294

 
4,513

CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
 
Capital expenditures of FPL
 
(2,976
)
 
(2,440
)
Independent power and other investments of NEER
 
(4,610
)
 
(2,870
)
Nuclear fuel purchases
 
(194
)
 
(310
)
Other capital expenditures and other investments
 
(149
)
 
(56
)
Sale of independent power and other investments of NEER
 
395

 
34

Proceeds from sale or maturity of securities in special use funds and other investments
 
2,635

 
3,751

Purchases of securities in special use funds and other investments
 
(2,711
)
 
(3,872
)
Proceeds from sale of a noncontrolling interest in subsidiaries
 
645

 
319

Other - net
 
(18
)
 
(33
)
Net cash used in investing activities
 
(6,983
)
 
(5,477
)
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
 
Issuances of long-term debt
 
4,644

 
3,462

Retirements of long-term debt
 
(2,654
)
 
(3,097
)
Proceeds from differential membership investors
 
328

 
46

Payments to differential membership investors
 
(84
)
 
(68
)
Proceeds from notes payable
 
500

 
1,450

Repayments of notes payable
 
(362
)
 
(313
)
Net change in commercial paper
 
254

 
(116
)
Issuances of common stock - net
 
528

 
1,274

Dividends on common stock
 
(1,205
)
 
(1,031
)
Other - net
 
(150
)
 
(39
)
Net cash provided by financing activities
 
1,799

 
1,568

Net increase in cash and cash equivalents
 
110

 
604

Cash and cash equivalents at beginning of period
 
571

 
577

Cash and cash equivalents at end of period
 
$
681

 
$
1,181

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
 
 
 
 
Accrued property additions
 
$
2,655

 
$
1,840

Increase in property, plant and equipment as a result of a settlement
 
$
(70
)
 
$
(5
)
Proceeds from differential membership investors used to reduce debt
 
$
100

 
$


This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

11




NEXTERA ENERGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(millions)
(unaudited)
 
Common Stock
 
Additional
Paid-In
Capital
 
Unearned
ESOP
Compensation
 
Accumulated
Other
Comprehensive
Income
(Loss)
 
Retained
Earnings
 
Total
Common
Shareholders'
Equity
 
Non-
controlling
Interests
 
Total
Equity
 
Shares
 
Aggregate
Par Value
 
Balances, December 31, 2015
461

 
$
5

 
$
8,597

 
$
(1
)
 
$
(167
)
 
$
14,140

 
$
22,574

 
$
538

 
$
23,112

Net income

 

 

 

 

 
1,946

 
1,946

 
42

 
 
Issuances of common stock, net of issuance cost of less than $1
5

 

 
523

 

 

 

 
523

 

 
 
Exercise of stock options and other incentive plan activity
1

 

 
57

 

 

 

 
57

 

 
 
Dividends on common stock

 

 

 

 

 
(1,205
)
 
(1,205
)
 

 
 
Earned compensation under ESOP

 

 
38

 
1

 

 

 
39

 

 
 
Premium on equity units

 

 
(200
)
 

 

 

 
(200
)
 

 
 
Other comprehensive income(loss)

 

 

 

 
131

 

 
131

 
(19
)
 
 
Issuance costs of equity units

 

 
(25
)
 

 

 

 
(25
)
 

 
 
Sale of NEER assets to NEP

 

 
49

 

 

 

 
49

 
440

 

Distributions to noncontrolling interests

 

 

 

 

 

 

 
(37
)
 
 
Other changes in noncontrolling interests in subsidiaries

 

 

 

 

 

 

 
(2
)
 

Adoption of accounting standards update

 

 

 

 

 
18

 
18

 

 
 
Balances, September 30, 2016
467

 
$
5

 
$
9,039

 
$

 
$
(36
)
 
$
14,899

 
$
23,907

 
$
962

 
$
24,869


 
Common Stock
 
Additional
Paid-In
Capital
 
Unearned
ESOP
Compensation
 
Accumulated
Other
Comprehensive
Income
(Loss)
 
Retained
Earnings
 
Total
Common
Shareholders'
Equity
 
Non-
controlling
Interests
 
Total
Equity
 
Shares
 
Aggregate
Par Value
 
Balances, December 31, 2014
443

 
$
4

 
$
7,193

 
$
(14
)
 
$
(40
)
 
$
12,773

 
$
19,916

 
$
252

 
$
20,168

Net income

 

 

 

 

 
2,245

 
2,245

 
7

 
 
Issuances of common stock, net of issuance cost of less than $1
17

 
1

 
1,289

 
3

 

 

 
1,293

 

 
 
Exercise of stock options and other incentive plan activity
1

 

 
58

 

 

 

 
58

 

 
 
Dividends on common stock

 

 

 

 

 
(1,031
)
 
(1,031
)
 

 
 
Earned compensation under ESOP

 

 
31

 
5

 

 

 
36

 

 
 
Premium on equity units

 

 
(80
)
 

 

 

 
(80
)
 

 
 
Other comprehensive loss

 

 

 

 
(128
)
 

 
(128
)
 
(6
)
 
 
Issuance costs of equity units

 

 
(25
)
 

 

 

 
(25
)
 

 
 
Sale of NEER assets to NEP

 

 
34

 

 

 

 
34

 
261

 
 
Distributions to noncontrolling interests

 

 

 

 

 

 

 
(13
)
 
 
Other changes in noncontrolling interests in subsidiaries

 

 

 

 

 

 

 
7

 

Balances, September 30, 2015
461

 
$
5

 
$
8,500

 
$
(6
)
 
$
(168
)
 
$
13,987

 
$
22,318

 
$
508

 
$
22,826



This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

12




FLORIDA POWER & LIGHT COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(millions)
(unaudited)

 
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
 
2016
 
2015
 
2016
 
2015
OPERATING REVENUES
 
$
3,283

 
$
3,274

 
$
8,337

 
$
8,812

OPERATING EXPENSES
 
 

 
 

 
 

 
 

Fuel, purchased power and interchange
 
1,045

 
1,195

 
2,556

 
3,298

Other operations and maintenance
 
403

 
410

 
1,203

 
1,147

Depreciation and amortization
 
587

 
485

 
1,207

 
1,154

Taxes other than income taxes and other - net
 
327

 
329

 
908

 
910

Total operating expenses
 
2,362

 
2,419

 
5,874

 
6,509

OPERATING INCOME
 
921

 
855

 
2,463

 
2,303

OTHER INCOME (DEDUCTIONS)
 
 

 
 

 
 

 
 

Interest expense
 
(114
)
 
(110
)
 
(342
)
 
(337
)
Allowance for equity funds used during construction
 
17

 
20

 
55

 
46

Other - net
 

 
(2
)
 
3

 
(1
)
Total other deductions - net
 
(97
)
 
(92
)
 
(284
)
 
(292
)
INCOME BEFORE INCOME TAXES
 
824

 
763

 
2,179

 
2,011

INCOME TAXES
 
309

 
274

 
823

 
728

NET INCOME(a)
 
$
515

 
$
489

 
$
1,356

 
$
1,283

_______________________
(a)
FPL's comprehensive income is the same as reported net income.






























This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

13




FLORIDA POWER & LIGHT COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS
(millions, except share amount)
(unaudited)
 
 
September 30,
2016
 
December 31,
2015
ELECTRIC UTILITY PLANT AND OTHER PROPERTY
 
 
 
 
Plant in service and other property
 
$
43,700

 
$
41,227

Nuclear fuel
 
1,333

 
1,306

Construction work in progress
 
2,817

 
2,850

Accumulated depreciation and amortization
 
(12,406
)
 
(11,862
)
Total electric utility plant and other property - net
 
35,444

 
33,521

CURRENT ASSETS
 
 

 
 

Cash and cash equivalents
 
46

 
23

Customer receivables, net of allowances of $4 and $3, respectively
 
1,013

 
849

Other receivables
 
112

 
123

Materials, supplies and fossil fuel inventory
 
868

 
826

Regulatory assets:
 
 

 
 

Derivatives
 

 
218

Other
 
300

 
284

Other
 
146

 
184

Total current assets
 
2,485

 
2,507

OTHER ASSETS
 
 

 
 

Special use funds
 
3,706

 
3,504

Prepaid benefit costs
 
1,286

 
1,243

Regulatory assets:
 
 

 
 

Purchased power agreement termination
 
658

 
726

Other ($84 and $128 related to a VIE, respectively)
 
854

 
787

Other
 
184

 
235

Total other assets
 
6,688

 
6,495

TOTAL ASSETS
 
$
44,617

 
$
42,523

CAPITALIZATION
 
 

 
 

Common stock (no par value, 1,000 shares authorized, issued and outstanding)
 
$
1,373

 
$
1,373

Additional paid-in capital
 
7,732

 
7,733

Retained earnings
 
6,503

 
6,447

Total common shareholder's equity
 
15,608

 
15,553

Long-term debt ($143 and $210 related to a VIE, respectively)
 
9,846

 
9,956

Total capitalization
 
25,454

 
25,509

CURRENT LIABILITIES
 
 

 
 

Commercial paper
 
464

 
56

Notes payable
 
450

 
100

Current maturities of long-term debt
 
67

 
64

Accounts payable
 
759

 
664

Customer deposits
 
464

 
469

Accrued interest and taxes
 
785

 
279

Derivatives
 
5

 
222

Accrued construction-related expenditures
 
245

 
240

Other
 
462

 
355

Total current liabilities
 
3,701

 
2,449

OTHER LIABILITIES AND DEFERRED CREDITS
 
 

 
 

Asset retirement obligations
 
1,890

 
1,822

Deferred income taxes
 
8,349

 
7,730

Regulatory liabilities:
 
 

 
 

Accrued asset removal costs
 
1,928

 
1,921

Asset retirement obligation regulatory expense difference
 
2,290

 
2,182

Other
 
508

 
492

Other
 
497

 
418

Total other liabilities and deferred credits
 
15,462

 
14,565

COMMITMENTS AND CONTINGENCIES
 


 


TOTAL CAPITALIZATION AND LIABILITIES
 
$
44,617

 
$
42,523


This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

14


FLORIDA POWER & LIGHT COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(millions)
(unaudited)

 
 
Nine Months Ended 
 September 30,
 
 
2016
 
2015
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
Net income
 
$
1,356

 
$
1,283

Adjustments to reconcile net income to net cash provided by (used in) operating activities:
 
 

 
 

Depreciation and amortization
 
1,207

 
1,154

Nuclear fuel and other amortization
 
167

 
160

Deferred income taxes
 
569

 
107

Cost recovery clauses and franchise fees
 
111

 
114

Purchased power agreement termination
 

 
(521
)
Allowance for equity funds used during construction
 
(55
)
 
(46
)
Other - net
 
23

 
54

Changes in operating assets and liabilities:
 
 

 
 

Customer and other receivables
 
(169
)
 
(250
)
Materials, supplies and fossil fuel inventory
 
(42
)
 
(39
)
Other current assets
 
26

 
(49
)
Other assets
 
12

 
(41
)
Accounts payable and customer deposits
 
94

 
32

Income taxes
 
150

 
366

Interest and other taxes
 
369

 
357

Other current liabilities
 
66

 
28

Other liabilities
 
(94
)
 
(41
)
Net cash provided by operating activities
 
3,790

 
2,668

CASH FLOWS FROM INVESTING ACTIVITIES
 
 

 
 

Capital expenditures
 
(2,976
)
 
(2,440
)
Nuclear fuel purchases
 
(121
)
 
(178
)
Proceeds from sale or maturity of securities in special use funds
 
1,775

 
3,099

Purchases of securities in special use funds
 
(1,836
)
 
(3,149
)
Other - net
 
32

 
(86
)
Net cash used in investing activities
 
(3,126
)
 
(2,754
)
CASH FLOWS FROM FINANCING ACTIVITIES
 
 

 
 

Issuances of long-term debt
 
150

 
85

Retirements of long-term debt
 
(262
)
 
(550
)
Proceeds from notes payable
 
500

 

Repayments of notes payable
 
(150
)
 

Net change in commercial paper
 
408

 
(896
)
Capital contribution from NEE
 

 
1,454

Dividends to NEE
 
(1,300
)
 

Other - net
 
13

 
9

Net cash provided by (used in) financing activities
 
(641
)
 
102

Net increase in cash and cash equivalents
 
23

 
16

Cash and cash equivalents at beginning of period
 
23

 
14

Cash and cash equivalents at end of period
 
$
46

 
$
30

SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES
 
 

 
 

Accrued property additions
 
$
475

 
$
355





This report should be read in conjunction with the Notes herein and the Notes to Consolidated Financial Statements appearing in the 2015 Form 10-K.

15


NEXTERA ENERGY, INC. AND FLORIDA POWER & LIGHT COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

The accompanying condensed consolidated financial statements should be read in conjunction with the 2015 Form 10-K. In the opinion of NEE and FPL management, all adjustments (consisting of normal recurring accruals) considered necessary for fair financial statement presentation have been made. Certain amounts included in the prior year's condensed consolidated financial statements have been reclassified to conform to the current year's presentation. The results of operations for an interim period generally will not give a true indication of results for the year.

1.  Employee Retirement Benefits

NEE sponsors a qualified noncontributory defined benefit pension plan for substantially all employees of NEE and its subsidiaries and sponsors a contributory postretirement plan for other benefits for retirees of NEE and its subsidiaries meeting certain eligibility requirements.

The components of net periodic (income) cost for the plans are as follows:
 
Pension Benefits
 
Postretirement Benefits
 
Pension Benefits
 
Postretirement Benefits
 
Three Months Ended 
 September 30,
 
Three Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
Nine Months Ended 
 September 30,
 
2016
 
2015
 
2016
 
2015
 
2016
 
2015
 
2016
 
2015
 
(millions)
Service cost
$
16

 
$
17

 
$

 
$
1

 
$
47

 
$
53

 
$
1

 
$
2

Interest cost
26

 
23

 
3

 
3

 
78

 
72

 
10

 
10

Expected return on plan assets
(65
)
 
(63
)
 

 

 
(195
)
 
(190
)
 

 
(1
)
Amortization of prior service (benefit) cost

 

 

 
(1
)
 
1

 
1

 
(2
)
 
(2
)
Amortization of losses

 

 

 
1

 

 

 

 
2

Net periodic (income) cost at NEE
$
(23
)
 
$
(23
)
 
$
3

 
$
4

 
$
(69
)
 
$
(64
)
 
$
9

 
$
11

Net periodic (income) cost at FPL
$
(15
)
 
$
(14
)
 
$
2

 
$
3

 
$
(44
)
 
$
(41
)
 
$
7

 
$
8


2.  Derivative Instruments

NEE and FPL use derivative instruments (primarily swaps, options, futures and forwards) to manage the commodity price risk inherent in the purchase and sale of fuel and electricity, as well as interest rate and foreign currency exchange rate risk associated primarily with outstanding and expected future debt issuances and borrowings, and to optimize the value of NEER's power generation and gas infrastructure assets.

With respect to commodities related to NEE's competitive energy business, NEER employs risk management procedures to conduct its activities related to optimizing the value of its power generation and gas infrastructure assets, providing full energy and capacity requirements services primarily to distribution utilities, and engaging in power and gas marketing and trading activities to take advantage of expected future favorable price movements and changes in the expected volatility of prices in the energy markets. These risk management activities involve the use of derivative instruments executed within prescribed limits to manage the risk associated with fluctuating commodity prices. Transactions in derivative instruments are executed on recognized exchanges or via the OTC markets, depending on the most favorable credit terms and market execution factors. For NEER's power generation and gas infrastructure assets, derivative instruments are used to hedge the commodity price risk associated with the fuel requirements of the assets, where applicable, as well as to hedge all or a portion of the expected output of these assets. These hedges are designed to reduce the effect of adverse changes in the wholesale forward commodity markets associated with NEER's power generation and gas infrastructure assets. With regard to full energy and capacity requirements services, NEER is required to vary the quantity of energy and related services based on the load demands of the customers served. For this type of transaction, derivative instruments are used to hedge the anticipated electricity quantities required to serve these customers and reduce the effect of unfavorable changes in the forward energy markets. Additionally, NEER takes positions in the energy markets based on differences between actual forward market levels and management's view of fundamental market conditions, including supply/demand imbalances, changes in traditional flows of energy, changes in short- and long-term weather patterns and anticipated regulatory and legislative outcomes. NEER uses derivative instruments to realize value from these market dislocations, subject to strict risk management limits around market, operational and credit exposure.

Derivative instruments, when required to be marked to market, are recorded on NEE's and FPL's condensed consolidated balance sheets as either an asset or liability measured at fair value. At FPL, substantially all changes in the derivatives' fair value are deferred as a regulatory asset or liability until the contracts are settled, and, upon settlement, any gains or losses are passed through the fuel clause. For NEE's non-rate regulated operations, predominantly NEER, essentially all changes in the derivatives' fair value for power purchases and sales, fuel sales and trading activities are recognized on a net basis in operating revenues; fuel purchases

16


NEXTERA ENERGY, INC. AND FLORIDA POWER & LIGHT COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)


used in the production of electricity are recognized in fuel, purchased power and interchange expense; and the equity method investees' related activity is recognized in equity in earnings of equity method investees in NEE's condensed consolidated statements of income. Settlement gains and losses are included within the line items in the condensed consolidated statements of income to which they relate. Transactions for which physical delivery is deemed not to have occurred are presented on a net basis in the condensed consolidated statements of income. For commodity derivatives, NEE believes that, where offsetting positions exist at the same location for the same time, the transactions are considered to have been netted and therefore physical delivery has been deemed not to have occurred for financial reporting purposes. Settlements related to derivative instruments are primarily recognized in net cash provided by operating activities in NEE's and FPL's condensed consolidated statements of cash flows.

In January 2016, NEE discontinued hedge accounting for its cash flow and fair value hedges related to interest rate and foreign currency derivative instruments and, therefore, all changes in the derivatives' fair value, as well as the transaction gain or loss on foreign denominated debt, are recognized in interest expense in NEE's condensed consolidated statements of income. In addition, for the three and nine months ended September 30, 2016, NEE reclassified approximately $2 million ($1 million after tax) and $17 million ($10 million after tax), respectively, from AOCI to interest expense primarily because it became probable that a related future transaction being hedged would not occur. At September 30, 2016, NEE's AOCI included amounts related to the discontinued interest rate cash flow hedges with expiration dates through March 2035 and foreign currency cash flow hedges with expiration dates through September 2030. Approximately $84 million of net losses included in AOCI at September 30, 2016 is expected to be reclassified into earnings within the next 12 months as the principal and/or interest payments are made. Such amounts assume no change in scheduled principal payments.

Fair Value of Derivative Instruments - The tables below present NEE's and FPL's gross derivative positions at September 30, 2016 and December 31, 2015, as required by disclosure rules. However, the majority of the underlying contracts are subject to master netting agreements and generally would not be contractually settled on a gross basis. Therefore, the tables below also present the derivative positions on a net basis, which reflect the offsetting of positions of certain transactions within the portfolio, the contractual ability to settle contracts under master netting arrangements and the netting of margin cash collateral (see Note 3 - Recurring Fair Value Measurements for netting information), as well as the location of the net derivative position on the condensed consolidated balance sheets.
 
September 30, 2016
 
Fair Values of Derivatives Not
Designated as Hedging
Instruments for Accounting
Purposes - Gross Basis
 
Fair Values of Derivatives Not
Designated as Hedging
Instruments for Accounting
Purposes - Net Basis
 
Assets
 
Liabilities
 
Assets
 
Liabilities
 
(millions)
NEE:
 
 
 
 
 
 
 
Commodity contracts
$
5,105

 
$
3,479

 
$
1,943

 
$
558

Interest rate contracts
60

 
788

 
55

 
782

Foreign currency swaps
9

 
35

 
8

 
36

Total fair values
$
5,174

 
$
4,302

 
$
2,006

 
$
1,376

 
 
 
 
 
 
 
 
FPL:
 
 
 
 
 
 
 
Commodity contracts
$
48

 
$
20

 
$
33

 
$
5

 
 
 
 
 
 
 
 
Net fair value by NEE balance sheet line item:
 
 
 
 
 
 
 
Current derivative assets(a)
 
 
 
 
$
612

 
 
Noncurrent derivative assets(b)
 
 
 
 
1,394

 
 
Current derivative liabilities
 
 
 
 
 
 
$
377

Noncurrent derivative liabilities
 
 
 
 
 
 
999

Total derivatives
 
 
 
 
$
2,006

 
$
1,376

 
 
 
 
 
 
 
 
Net fair value by FPL balance sheet line item:
 
 
 
 
 
 
 
Current other assets
 
 
 
 
$
22

 
 
Noncurrent other assets
 
 
 
 
11

 
 
Current derivative liabilities
 
 
 
 
 
 
$
5

Total derivatives
 
 
 
 
$
33

 
$
5

———————————————
(a)
Reflects the netting of approximately $148 million in margin cash collateral received from counterparties.
(b)
Reflects the netting of approximately $93 million in margin cash collateral received from counterparties.


17


NEXTERA ENERGY, INC. AND FLORIDA POWER & LIGHT COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)


 
December 31, 2015
 
Fair Values of Derivatives
Designated as Hedging
Instruments for Accounting
Purposes - Gross Basis
 
Fair Values of Derivatives Not
Designated as Hedging
Instruments for Accounting
Purposes - Gross Basis
 
Total Derivatives Combined -
Net Basis
 
Assets
 
Liabilities
 
Assets
 
Liabilities
 
Assets
 
Liabilities
 
(millions)
NEE:
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
$

 
$

 
$
5,906

 
$
4,580

 
$
1,937

 
$
982

Interest rate contracts
33

 
155

 
2

 
160

 
34

 
319

Foreign currency swaps

 
132

 

 

 

 
127

Total fair values
$
33

 
$
287

 
$
5,908

 
$
4,740

 
$
1,971

 
$
1,428

 
 
 
 
 
 
 
 
 
 
 
 
FPL:
 
 
 
 
 
 
 
 
 
 
 
Commodity contracts
$

 
$

 
$
7

 
$
225

 
$
4

 
$
222

 
 
 
 
 
 
 
 
 
 
 
 
Net fair value by NEE balance sheet line item: