FPL Group, Inc. & Subsidiaries - Page 162

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                    has not been completed times the progress                         
                    payment of such uncompleted milestones being                      
                    terminated.                                                       
               A 1986 BI No. 897 budgeted $15 million to purchase:  12,000            
          load control transponders; 1,050 metering transponders; and 500             
          surface mount load survey transponders, communication equipment             
          for substations, test equipment, and computer hardware and                  
          software.  The budget item states that work was to begin in 1985            
          and was to be completed in 1988.  It further states that a load             
          management communications system is necessary to meet the demand            
          and energy goals of the FPSC and FPL’s energy management plan.              
          This budget item permitted FPL to implement phase I of the LMS:             
               Initially, the Load Management System will be sized for                
               10,000 load control points and 1,000 TOU [Time-of-Use]                 
               meter points, and 500 load survey points.  After Phase                 
               I is thoroughly tested and results are satisfactory,                   
               the system will be expanded to support 388,000 load                    
               control points and 220,000 TOU Rate customers by 1994.                 
          BI No. 897 was revised in 1989 to increase the amount budgeted              
          for phase I to $20 million.  The budget item states:                        
               Phase II of the program is covered under Budget item                   
               868 which calls for the System to be expanded to                       
               support 250,000 load control points by 1993.                           
                         Total Program Capital ($000)                                 
                         Phase I   -    $ 20,000                                      
                         Phase II -     90,000                                        
                         All future                                                   
                         Phases    -      95,000                                      
                         Total          $205,000                                      
               A 1989 BI No. 868 budgeted $90 million for phase II of the             
          LMS.  The budget item states that work was to begin in 1989 and             
          was to be completed in 1993.  It also explains that phase II will           





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