May 16, 2001

PSC approves staff recommendation for full review of FPL's base rates

JUNO BEACH, Fla. -- Florida Power & Light Company reported today that the Florida Public Service Commission yesterday approved the recommendation of its staff to begin initial filings as part of a full base rate proceeding.

FPL will be required to provide financial information to the PSC staff by August 15.

"We are disappointed that the Commission decided to initiate a rate proceeding to review FPL's rates. This action is a step back from incentive-based regulation to the time-consuming and costly rate proceedings of years past," said Paul Evanson, FPL president.

"We believe our current three-year revenue-sharing agreement, which still has one year to run, has already provided significant savings of more than $800 million for our customers. Embarking on a collaborative process aimed toward a new incentive-based agreement would have yielded far better results for our customers," he said.

Rates have been reduced by more than $350 million a year for three years, and customers share the majority of revenues exceeding specific levels ($22.8 million in 2000 and approximately $105 million in 2001). The agreement also provides incentives for FPL to continue to reduce operations and maintenance expenses.

In a motion filed with the PSC on Friday, FPL, Florida Power Corporation and Tampa Electric Company requested that the Commission open a separate generic docket to address issues related to their participation in a regional transmission organization (GridFlorida). The companies are forming the RTO in response to the Federal Energy Regulatory Commission Order 2000. The Commission deferred consideration of the utilities' motion.

"Without resolution of the PSC's concerns associated with GridFlorida, the participants will re-evaluate the timing and developmental plans for the RTO," said Mr. Evanson.

Florida Power & Light Company is the principal subsidiary of FPL Group, Inc. (NYSE:FPL), one of the nation's largest providers of electricity-related services with annual revenues of more than $7 billion. The company serves approximately 3.9 million customer accounts in Florida. FPL Energy, LLC, FPL Group's U.S. and international energy-generating subsidiary, is a leader in producing electricity from clean and renewable fuels. Additional information is available on the Internet at www.fpl.com.