FPL Group, Inc. & Subsidiaries - Page 195

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            in service in the 1988, 1989, and 1990 taxable years,                                       
            respectively.                                                                               
            J.    Distribution and Transmission Substations                                             
                  A distribution substation transforms transmission voltage of                          
            electricity from high voltage/lower current to low voltage/higher                           
            current; i.e., to “distribution voltage”.  The distribution                                 
            voltage is distributed through feeder wire (either overhead or                              
            underground), then through either aerial or pad-mounted                                     
            transformers, and then to utility customers (residential or                                 
            commercial).  A transmission substation either consolidates                                 
            transmission lines or transforms voltage from one voltage to                                
            another.  FPL used similar procedures for designing and                                     
            constructing distribution substations to those it used for                                  
            transmission substations.  Typically, FPL builds a distribution                             
            substation on approximately 5 acres of property, with                                       
            approximately 1 acre in the middle of the property developed for                            
            the substation.  FPL claims ITCs for the distribution and                                   
            transmission substation components in the 1988, 1989, and 1990                              
            taxable years.                                                                              
                  The most important components of a distribution substation                            
            are the “power transformers” (transformers) because this                                    
            equipment transforms the voltage from transmission voltage to                               
            distribution voltage.  Also, the transformers are significantly                             
            more expensive than the other items in the substation.  A                                   






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Last modified: May 25, 2011