NextEra Energy, Inc (NYSE: NEE) Q1 2026 Earnings Call dated Apr. 23, 2026
Corporate Participants:
Mark Eidelman — Director of Investor Relations
John W. Ketchum — Chairman, President and Chief Executive Officer
Michael Dunne — Executive Vice President, Finance and Chief Financial Officer
Brian Bolster — President and Chief Executive Officer of NextEra Energy Resources
Analysts:
Steve Fleishman — Analyst
Julien Dumoulin-Smith — Analyst
Shar Pourreza — Analyst
Bill Appicelli — Analyst
Nicholas Campanella — Analyst
Presentation:
Operator
Good day, and welcome to the NextEra Energy, Inc. First Quarter 2026 Earnings Call. [Operator Instructions]
At this time, I would now like to turn the conference over to Mark Eidelman, Director of Investor Relations. Please go ahead, sir.
Mark Eidelman — Director of Investor Relations
Good morning, everyone, and thank you for joining our first quarter 2026 financial results conference call for NextEra Energy. With me this morning are John Ketchum, Chairman, President, and Chief Executive Officer of NextEra Energy; Mike Dunne, Executive Vice President and Chief Financial Officer of NextEra Energy; Armando Pimentel, Chief Executive Officer of Florida Power & Light Company; Scott Voorhees, President of Florida Power & Light Company; Brian Bolster, President and Chief Executive Officer of NextEra Energy Resources; and Mark Hickson, Executive Vice President of NextEra Energy. John will start with opening remarks, and then Mike will provide an overview of our results. Our executive team will then be available to answer your questions. We will be making forward-looking statements during this call based on current expectations and assumptions, which are subject to risks and uncertainties.
Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect or because of other factors discussed in today’s earnings news release, in the comments made during this conference call, in the Risk Factors section of the company presentation, or in our latest reports and filings with the Securities and Exchange Commission, each of which can be found on our website, www.nexteraenergy.com. We do not undertake any duty to update any forward-looking statements. Today’s presentation also includes references to non-GAAP financial measures. You should refer to the information contained in the slides accompanying today’s presentation for definitional information and reconciliations of historical non-GAAP measures to the closest GAAP financial measure.
With that, I’ll turn the call over to John.
John W. Ketchum — Chairman, President and Chief Executive Officer
Thanks, Mark, and good morning, everyone. NextEra Energy is off to a terrific start to the year, delivering strong first-quarter results. Adjusted earnings per share increased by 10% year-over-year, reflecting strong financial and operational performance at both FPL and Energy Resources. Over the past several months, I’ve been working closely with our customers, policymakers, and stakeholders. Two things could not be clearer to me. First, demand for electricity in this country is not slowing down. In fact, it’s accelerating. Our customers need power now, and speed to power is essential. Second, building new power infrastructure must be done in a way that addresses affordability challenges and keeps bills low for existing customers.
NextEra Energy is doing both. We’re able to meet this increased power demand while keeping power prices low, and we’re doing it by leveraging our common platform. We build all forms of energy infrastructure. We have experience across the entire energy value chain at massive scale with a balance sheet to back it up, and we continuously drive operational efficiency across our portfolio to deliver value and affordability to customers. At FPL, our value proposition is clear: leverage a diverse generation mix and a resilient grid to provide low-cost, highly reliable electricity to our customers every single day. At Energy Resources, customers choose us because they know we have an unmatched, decades-long track record of building energy infrastructure that delivers cost-effective solutions tailored to their needs.
NextEra Energy was built for this moment of extraordinary growth. With a service area that spans 49 states and with more than 12 ways to grow, I couldn’t be more excited about our ability to deliver for our customers, our shareholders, and our country. Importantly, our forecasted growth is visible and balanced between our regulated and long-term contracted businesses. Florida is a prime example of how we reliably serve growth while keeping bills low. The Sunshine State has been one of the fastest-growing states for decades and continues its rapid expansion today. Florida is already a $1.8 trillion economy, the 15th largest in the world, and the growth isn’t slowing down. Florida’s GDP is forecasted to grow 4.7% annually through 2040. In fact, in the first quarter, FPL added nearly 100,000 customers compared to the prior year comparable period. For perspective, roughly 90% of utilities nationwide serve less than that day to day. FPL added these customers to our system in just the last 12 months.
FPL supports this growth by building the right new power generation and the right new transmission infrastructure across the state. In fact, FPL expects to invest between $90 billion and $100 billion through 2032, primarily to support Florida’s growing economy. Earlier this month, FPL filed its annual 10-year site plan, detailing its approach to reliably and cost-effectively meet the growing need for electricity in Florida. The plan shows roughly 4 gigawatts of new gas-fired generation, complementing over 12 gigawatts of solar and over 7 gigawatts of storage solutions over the next 10 years, which would further diversify FPL’s generation fleet. Yet, even with significant capital investment, bills have actually gone down over time. When you adjust for inflation, the typical FPL residential customer bill is 20% lower today than it was 20 years ago. In nominal terms, FPL’s bills are approximately 30% below the national average and only projected to grow on average about 2% annually through the end of the decade.
On top of that, FPL delivers customers top decile reliability that’s approximately 68% better than the national average. Low bills and high reliability don’t happen by accident. Instead, this performance is a direct result of smart, disciplined capital investments, coupled with a relentless focus on operating efficiently. This is a value proposition that not only best serves our existing customers, but also works really well for new large load customers like hyperscalers who value reliability, cost, and speed to market, all things we can deliver. As part of FPL’s approved four-year rate settlement agreement that went into effect in January, we proactively developed a large load tariff to provide the necessary certainty for both customers and regulators, balancing consumer protections with a competitive rate. Again, both things are possible with the right structure and a smart approach.
FPL’s speed to market advantages, combined with its best-in-class service, is creating significant large load interest. We have about 21 GW of large load interest at FPL. Of that, we are in advanced discussions on about 12 GW, a portion of which we believe we could begin serving as soon as 2028. We are making good progress on this front, and we continue to expect at least one large load customer to sign up for capacity under FPL’s tariff by the end of the year. Initially, we expect every GW of large load under FPL’s approved tariff to be equivalent to roughly $2 billion of CapEx, and to earn the same return on equity as other FPL investments. Energy Resources continues to grow its regulated electric and gas transmission portfolio. It can’t be stressed enough. Linear infrastructure is absolutely vital to meeting America’s electricity demand.
Pipelines fuel power plants, and transmission lines deliver electricity into communities. NextEra Energy Transmission is one of America’s leading independent electric transmission companies. Our scale and experience position us well as we execute on new transmission opportunities across America. In fact, just this week, one of NextEra Energy Transmission subsidiaries, Lone Star Transmission, received ERCOT approval to build portions of two new transmission lines in North Central Texas to improve reliability in the region. Lone Star’s investment share of approximately $300 million represents a roughly 40% increase in Lone Star’s rate base. NextEra Energy Transmission has now secured more than $5 billion in new projects since 2023. In total, NextEra Energy Transmission has regulated and secured capital of $8 billion, almost twice the rate base size of Gulf Power when we bought the company in 2019.
We also continue to execute against our plan to grow our gas transmission business. Energy Resources now has ownership interest in more than 1,000 miles of FERC-regulated pipelines. Importantly, it’s a portfolio with a number of organic expansion opportunities. All told, we expect our combined electric and gas transmission business at Energy Resources to grow to $20 billion of total regulated and investment capital by 2032, a 20% compound annual growth rate off a 2025 base. We recently added new senior leadership to our pipeline business to focus on growth opportunities, demonstrating our commitment to expanding our gas transmission business.
Turning to Energy Resources’ long-term contracted business, as I said at the outset, it simply can’t be overstated. Our customers need a lot of power and they need it now. Renewables and storage continue to be the fastest way to get new electrons on the grid until additional gas power generation can be built. This is why we had a record quarter at Energy Resources, adding to backlog 4 GW of new long-term contracted renewables and storage projects. This includes another strong quarter of battery storage origination at 1.3 GW. Importantly, we have 4 growth avenues for battery storage. We build standalone battery storage, co-locate storage at existing sites, develop storage as a grid solution, and expand batteries from 4 hours to 8 hours at existing storage projects.
Our standalone and co-located battery storage pipeline sits at over 110 GW, excluding expansion opportunities. Bottom line, in a market driven by a significant need for quick capacity solutions, Energy Resources remains well-positioned to serve customers with battery storage. We’re also off to a terrific start executing against our data center hub strategy, which is built on the power of scale. Scale shortens development pipelines, reduces execution risk, and keeps costs low as we build the infrastructure needed to meet data center power demand. To this end, last month, the U.S. Department of Commerce selected Energy Resources to build 9.5 GW of new gas-fired generation to serve large loads. The projects are in connection with Japan’s $550 billion investment commitment to the United States as part of the U.S.-Japan trade deal. These are two separate projects, one located in Texas and the other located in Pennsylvania. Both are designed to serve large load in each state.
The U.S. and Japan would own the projects while Energy Resources would develop, build, and operate them. We are actively developing both projects, advancing site development, procurement, permitting, and commercial structuring as we work toward definitive agreements with the U.S. and Japan. The projects are drawn from our existing group of data center hubs, a group that totals over 30 hubs with a year-end goal to secure roughly 40. We now have 4 origination channels feeding into our base case goal of securing 15 gigawatts of new generation to serve large load by 2035. These four origination channels can also help us achieve our upside case of 30 gigawatts or more by 2035. We are working hard to meet this goal with all forms of energy, approximately 50% from gas-fired generation and the remainder from all other forms of energy. The first channel is working directly with hyperscalers to power their data centers. These are companies we have good long-standing relationships with. A great example is our collaboration with Google to recommission our Duane Arnold nuclear plant outside Cedar Rapids, Iowa. Our second channel is working with investor-owned utilities.
A perfect example is a joint development agreement, which we signed with Xcel earlier this week to jointly plan and rapidly deploy new generation, storage, and transmission to capture accelerating data center demand across Xcel’s 8-state service territory. Our third channel comes through our strong relationships with co-ops and municipalities. Our plan to work with Basin Electric to develop a 1.5-gigawatt combined cycle plant in North Dakota is a great example. Our co-op and municipality customers value our skills, our capabilities, our customer relationships with hyperscalers, and our balance sheet, making us the perfect partner. Working with the federal government to build new natural gas power generation is our fourth channel.
On Duane Arnold, we continue to make good progress. Earlier this month, the Nuclear Regulatory Commission approved a license transfer from the plant’s minority owners, Central Iowa Power Cooperative and Corn Belt Power Cooperative, to NextEra Energy. This key federal approval clears the way for Energy Resources to finalize the acquisition of their 30% ownership stake, which will give us full ownership of Duane Arnold. At the same time, the process to regain interconnection rights for Duane Arnold continues to progress as expected. The plant remains on track to reenter service no later than Q1 2029. We also continue to evaluate advanced nuclear, closely evaluating the capabilities of various SMR OEMs. We have 6 gigawatts of SMR co-location opportunities at our nuclear sites, and we are working to develop new greenfield sites. Of course, any new nuclear build would have to include the right commercial terms and conditions with appropriate risk-sharing mechanisms that limit our ultimate exposure.
Given that we’ve built more energy infrastructure over the last two decades than any other company, that means we have a lot of operating assets coming off contract. In fact, we have up to 6 gigawatts of renewables and 1.5 gigawatts of nuclear recontracting opportunities through 2032. The timing couldn’t be better. The projects were generally built and contracted years ago during much less favorable market conditions. As the PPAs begin to expire over the next several years, we believe recontracting will command a higher price. In fact, in the first quarter, we contracted over 600 megawatts of existing projects, locking in contracts for an average of over 18 years, reflecting the strong electricity demand environment we’re seeing today.
Energy Resources’ customer supply business advanced its growth strategy during the first quarter, highlighted by our strategic acquisition of Symmetry Energy Solutions, which is one of the U.S.’s leading natural gas suppliers. Symmetry operates in 34 states and provides us access to additional physical assets, enabling us to deliver a broad range of solutions for our customers. In fact, across all of our businesses, we now transport and deliver approximately 2.9 trillion cubic feet of natural gas annually or about 8 billion cubic feet per day, making us one of the largest and most active gas suppliers serving wholesale, retail, and industrial customers nationwide. While we continue to grow and to deliver value and innovative solutions for customers every single day, we’re also focused on making ourselves better and taking steps to redefine the future of the entire electric industry.
We’re doing this through our new Rewire initiative in a partnership with Google Cloud. Rewire is a company-wide initiative to reimagine how we work and how we do business, paired with an enterprise-wide AI transformation that we expect to unlock top-line growth and cost savings opportunities for our customers. At the same time, Rewire is serving as our AI product development platform. We believe the new AI tools and solutions that we build will not only redefine how we do business and create a competitive advantage, but will also help transform how our industry generates and delivers electricity and serves customers. Partnering with Google, we are delivering these products to the utility industry to unlock savings for American homes and businesses. In the first quarter, we brought to market our first Rewire products.
For example, Conduit is an AI-powered tool designed to upskill our already best-in-class renewables workforce, increasing their efficiency in the field and keeping our power plants up and running. Another product called Generation Entitlement proactively identifies abnormal equipment conditions, enabling teams to take early action and optimize power plant performance across the fleet. A product called Grid Composer uses AI to optimize and orchestrate all aspects of the power generation process. It brings real-time recommendations into one place to enable faster, more informed decisions around unit commitment, power, and fuel dispatch, and maintenance scheduling. Importantly, we believe these tools have the potential to drive significant savings for customers. FPL’s bill today is already approximately 30% below the national average.
One of the reasons that’s possible is because of our relentless focus on technology and driving costs out of the business. FPL’s non-fuel O&M is more than 71% lower than the industry average. In fact, we’re 50% more cost-efficient than the second-best utility in America. We believe our Rewire products reinforce our position as the lowest cost electric utility operator in the country. It doesn’t stop there. By working closely with hyperscalers, we’re structuring solutions that support growth while keeping power prices affordable for American families. As we’ve discussed previously, that’s why Energy Resources has been focused on the Bring Your Own Generation, or BYOG model, that ensures large load customers pay their fair share. Not coincidentally, that happens to be perfectly aligned with where the market and policy makers are moving. The concept is simple. We build energy infrastructure for hyperscalers, and they pay for it. Everyday Americans do not. That’s the way to power America’s growth and keep power bills affordable.
We believe there’s much more to the story. Remember, many parts of the country are starting at real capacity deficits as we approach the end of the decade. BYOG power solutions could become critical elements of a resilient grid if we start to think about them as dispatchable resources during times of extreme demand. It’s exactly what we’re working on with Nvidia, a collaboration we announced in the first quarter. Just think about being able to temporarily cycle down or shift data center activity for a few hours during extreme cold or extreme heat. That would allow local load-serving entities to use that power to meet customer demand when power is scarce and at a higher cost, increasing reliability and lowering power bills for everyday Americans.
This is another example of how we’re trying to lead a move to where we believe the market is going to be. Bottom line, at this unique moment in our industry, scale, experience, and innovation matter more than ever, and our common platform provides us with what we believe is an unmatched competitive advantage. It’s more than just our operating scale. We have a robust supply chain. We have global banking relationships. We’ve worked hard to maintain one of the largest and strongest balance sheets in the sector, and we use technology and data to deliver solutions for our customers. This platform is what enables us to build all forms of energy across the energy value chain. It’s also hard to replicate. That’s because we’ve been building it, refining it, and optimizing it for decades. It’s how we deliver customers the reliable and affordable solutions they need, when they need it, no matter where they are in America. And as power demand rises, these unique capabilities become increasingly important, all of which is a big win for our customers, stakeholders, and shareholders we are honored to serve. I’m pleased with how we’ve started the year and even more excited for the rest of 2026 as we execute on our more than 12 ways to grow.
With that, I’ll turn the call over to Mike.
Michael Dunne — Executive Vice President, Finance and Chief Financial Officer
Thanks, John. Let’s begin with FPL’s detailed results. For the first quarter of 2026, FPL’s earnings per share increased $0.06 year-over-year. Regulatory capital and growth of approximately 8.8% was a significant driver of FPL’s earnings per share growth versus the prior year comparable quarter. FPL’s capital expenditures were approximately $3.2 billion for the quarter, and we expect FPL’s full year capital investments to be between $12 billion and $13 billion. For the 12 months ending March 2026, FPL’s reported return on equity for regulatory purposes will be approximately 11.7%.
During the first quarter, we utilized approximately $306 million of the rate stabilization mechanism, leaving FPL with an after-tax balance of approximately $1.2 billion. This quarter, FPL placed into service approximately 600 MW of new cost-effective solar, putting FPL’s owned and operated solar portfolio at over 8.5 GW. The indicators show Florida’s economy remains healthy. Florida continues to be one of the fastest-growing states in the nation and has three of the five fastest-growing U.S. metro areas between 2024 and 2025. As John mentioned, FPL had a strong quarter of customer growth, with the average number of customers increasing by nearly 100,000 from the comparable prior year period. FPL’s first quarter retail sales increased by approximately 3.4% year-over-year. After taking weather into account, first quarter retail sales increased by roughly 0.3% on a weather normalized basis from the comparable prior year period, driven primarily by continued favorable underlying population growth.
Now let’s turn to Energy Resources, which reported adjusted earnings growth of approximately 14% year-over-year. Contributions from new investments increased $0.04 per share year-over-year, primarily reflecting continued growth in our power generation portfolio. Our existing clean energy portfolio increased $0.01 per share during the quarter. The comparative contribution from our customer supply business decreased by $0.04 per share, primarily driven by lower production volume in our upstream operations and continued normalization of margins in our full requirements business. Contributions from NextEra Energy Transmission increased $0.05 per share year-over-year, net of financing costs, driven by the sale of a 50% equity interest in a transmission asset located in California. We had no change from other impacts as lower tax costs were largely offset by higher financing costs, which are primarily related to new borrowings to support our new investments.
We remain well-positioned to navigate the current interest rate environment through our over $43 billion interest rate hedging program. We have also planned for potential trade impacts and positioned ourselves to deliver and execute for our customers. That’s why we’ve proactively secured supply to support both FPL’s and Energy Resources development plans, including the development of our national data center hub footprint. For solar, we have secured panels through 2029. We’re also well-protected for battery storage, with competitively priced domestic supply also secured through 2029. We’ve secured key wind components domestically for our new build expectations through 2027, and we have sufficient transformer capacity to support our build forecast through the end of the decade. Energy Resources had a record quarter of new renewables and storage origination, with 4 GW added to the backlog.
With these additions, our backlog now totals approximately 33 GW after taking into account 0.3 GW of new projects placed into service since our last earnings call. This highlights the continued strong demand for renewables and storage. Our backlog additions reflect the diverse power demand we’re seeing across our customers. Roughly 30% of our backlog additions are driven by hyperscalers, while the remaining 70% comes from power utility customers, including cooperatives and municipalities.
Turning now to our first quarter 2026 consolidated results. Adjusted earnings from corporate and other decreased by $0.02 per share year-over-year. Our 2026 adjusted earnings per share expectations range of $3.92-$4.02 remains unchanged, and we are targeting the high end of that range. We expect to grow adjusted earnings per share at a compound annual growth rate of 8%+ through 2032 and are targeting the same from 2032 through 2035. All of the 2025 base of $3.71 adjusted earnings per share. From 2025 to 2032, we expect that our average annual growth in operating cash flow will be at or above our adjusted earnings per share compound annual growth rate range. We also continue to expect to grow our dividends per share at roughly 10% per year through 2026, off a 2024 base, and 6% per year from year-end 2026 through 2028. As always, our expectations assume our caveats.
This concludes our prepared remarks, and with that, we will open the line for questions.
Questions and Answers:
Operator
Thank you. [Operator Instructions] And today’s first question comes from Steve Fleishman with Wolfe Research. Please proceed.
Steve Fleishman
Yeah, hi. Good morning, everyone. So, the — just a couple questions on the US-Japan projects. First of all, I guess, do you have anything you could share on milestones and timeline to get to a final agreement there? And just do you have the turbines for these projects? And also just like pipeline and transmission access, is that something you might be able to participate in as well, helping to build pipe or transmission for these projects? Thanks.
John W. Ketchum
Yeah, Steve, I’ll go ahead and take this. This is John, and good morning. First of all, on the milestones, we continue to be heavily engaged, as you would expect with both the Department of Commerce and the Japanese government. Right now, as we negotiate definitive agreements, we’re looking to have those completed in the next two to three month period on both of those projects, so that’s the first piece on milestones and timeline. And then after those are executed, you can imagine the agreements themselves will contain a series of milestones with payments tied to those milestones as they are achieved.
On the second piece, in terms of product development or project development, we are heavily engaged at both sites, both the Texas site, and the Pennsylvania site in terms of advancing those sites forward. In terms of turbine supply, we’ll have ample supply of turbines not concerned about that for both of those projects. And in terms of gas pipeline access, obviously that’s one of the skills that we bring to the table. Anderson in Texas is strategically located because it’s one of our partners there is Comstock and so we have bountiful gas supply available in the region, which makes that project extremely attractive. And then as we advance Pennsylvania, that will be a key part of the decision-making matrix as we look to further the development activities there and then obviously, transmission access on both of those sites is something that we will obtain as we move those projects forward and the development pieces. That’s what we do. That’s what we do every day. And I think that was a big part of what I was trying to get across in my remarks.
When I look at the environment today and I think a big reason we got these awards with from the DOC is, there’s really nobody that looks like us today. There’s nobody out building generation at scale. We intentionally went out and shifted our strategy last year to bring our own generation. We knew that was where the market was heading. We saw it ahead of time. I think based on where our peers are, we set up our strategy around it, our supply chain around it, our development activities around it and a lot of what we’re doing, not only with the federal hubs, but outside of it with the data center hubs, is we know the market wants power solutions at scale. And to do that, you have to have a combination of capabilities and skill sets that we’ve been building for two to three decades at this company. They’re very hard to find. They’re very hard to put together if you don’t have them today. And so, being a builder in today’s market across 49 states with all the know-how, and capability sets that we have, I think really sets us apart from the competition.
Steve Fleishman
Great. Just one other unrelated question. Good to see the 600 MWs of recontracting being done. Do you have any data point on the price increase or price change in the new contracts versus the old ones?
John W. Ketchum
Yeah, Steve, the pricing on the new contracts is roughly a $20 per megawatt hour on average increase relative to the prior realized pricing.
Steve Fleishman
Great. Thank you.
Operator
And today’s next question comes from Julien Dumoulin-Smith with Jefferies. Please proceed.
Julien Dumoulin-Smith
Hey guys, good morning. Nicely done, genuinely. Just wanted to follow up a little bit on the linear infrastructure. How do you think about expanding this business? You talk about hires, etc, but can you talk a little bit about, is this an acquisitive strategy potentially or how do you think about building it or rebuilding, however you want to frame it?
John W. Ketchum
Yeah, so I’ll take it in pieces. I’ll start with transmission, then I’ll talk about pipelines. But first of all, when you think about the transmission business, I mean, this is really just leveraging all the skill sets that we have on the generation side because when you think about what it takes to build generation and what it takes to build linear infrastructure, it’s a lot of the same skill sets, right? You’ve got to have a very sophisticated land operation. You have to be able to really understand how to manage the permitting and approval process. You have to have a good ground game in terms of reaching out to local communities, working with stakeholders at the state and the federal level. And you have to find projects that make sense, that result in affordability for customers and these are the things that we do on the generation side every day that transcend over into linear infrastructure around transmission.
Given all the know-how we already have from FPL and the success we’ve had building transmission in Florida, all that from an operations standpoint extends out into what we’re doing there. So, terrific greenfield opportunities. It’s a lot of the same strategic steps we take around generation. So, I think those give us a big leg up. In terms of acquisitions, sure. If we found the right project that made sense, we could look at acquisition. It would depend on what stage of development it is, I mean, sometimes there are good development assets that make sense that could be a good fit with our overall portfolio. While we lean towards greenfield for the reasons I just gave, buying operating transmission assets, sure if we could be opportunistic about that and they made sense and were in the right places, that’s something that we could continue to look at as well.
But where we’ve seen a lot of success on the transmission side is our ability to partner with incumbents. And the relationships that we’ve been able to build across the investor-owned utility co-op and municipality space, I think not only lends and serves us well on generation, but on transmission as well. And we’re just seeing a lot of success through those partnering arrangements. So, I feel great about where the transmission and linear infrastructure opportunity set sits. And then on pipelines, that’s just naturally capitalizing on all those same greenfield skillsets I already talked about around generation and transmission. They equally apply to the pipeline business.
And then you think about all the different skill sets that we have just around market knowledge on where gas transmission can make sense. The Symmetry acquisition being a big part of that. When you’re one of the largest movers of gas molecules in the United States, you also probably have more information and more knowledge as to where gas pipelines expansions are required. It really helps inform our decision-making around our data center hubs on where they’re going to be most economical and really can be optimized around gas. So, all the investments and other pieces that we have around customer supply and Symmetry feed in equally well in the pipeline business and it’s a natural extension of our ability to enable data center hubs, right, by being able to build gas or build transmission to be able to serve hyperscalers because we’ve really moved away from, hey, let’s go build 200 or 300 MW. That just doesn’t get it done for a hyperscaler. We’re looking at building 2 to 5 GW for hyperscalers. You would just be amazed at the amount of interest and the amount of demand that we are seeing in the market for that solution and we are really unique in the ability to deliver that product because you have to have all the things I talked about in my prepared remarks to be able to do it and to be able to do it right.
Julien Dumoulin-Smith
Awesome. And if I can just squeeze in a quick follow-up here, maybe this is where Steve was going. I mean, just how would you set expectations for other non-Japanese type projects as far as the ETM effort goes? I mean, ETM is obviously linked this time to power dynamics creating a little bit of an accelerated timeline, I suspect, but I’m curious how you’d frame that.
John W. Ketchum
Yeah. No, great question, Julien. And so, we’ve talked a lot about our ability to work with co-ops and municipalities, and that really helps enable situations where we can move behind the meter in those service territories, maybe build something out that ultimately has what I call the extension cord, right? The access to the grid over time because even if you start behind the meter, you have to be able to demonstrate a path to be front of the meter within three, four, five years. But a lot of the discussions that we’re having around our data center hubs are starting behind the meter, right? Islanded solutions, I think more and more of the market’s going to go there, particularly in areas of the country where the load interconnect process is taking five to seven years to clear. People can’t wait. There’s too big of an opportunity cost around the data center business model and the cloud storage model to wait five to seven years for load interconnect. We solve that problem with a behind the meter solution, but you have to know what you’re doing. You have to know where to site those. You have to know how to bring a number of technologies to bear and you have to have the foresight to be able to build, to plan, and credibly lay out a situation where you can be interconnected within three, four, five years because that interconnection allows you to really optimize the value of that data center, because I truly believe that we need to be, as a country, looking at data centers as giant batteries that sit behind the grid.
And I talked about our Nvidia collaboration on being able to flex chips in terms of how they consume and use power. And given all the software we’ve developed around dispatch ability of batteries, we’re uniquely positioned to design a product and if you combine them with our customer supply business to firm and shape products during scarcity intervals, hot summer day, cold winter day, where a data center can be dispatched like a battery. And think about what that does for affordability for customers in the region when you’re providing that excess supply. That really helps to take a big hit out of the bill for everyday Americans that may struggle to pay those during those scarcity times that we have seen over the last five, ten years in this industry, so something we’re very focused on, something hyperscalers are very interested in and I think it’s unique for NextEra because we have all this expertise around technology, our partnership with Google being a part of that.
Julien Dumoulin-Smith
Awesome. Glad to see what you can pull off with Google here. All the best. All right, thank you.
John W. Ketchum
Hey, thanks, Julien.
Operator
And the next question comes from Shar Pourreza with Wells Fargo. Please proceed.
Shar Pourreza
Hey, guys. Good morning.
John W. Ketchum
Good morning.
Shar Pourreza
Good morning, John. John, just on large scale nuclear, I know the government and hyperscalers have indicated some level of interest in the AP1000 and there seems to be this consortium of regulated utilities forming that could consider new nuclear development as a group with a good portion of the cost inflation above budgeted amounts being borne by the hyperscalers, so the off-takers. Turkey Point is obviously under an active review with the NRC. Are you sort of part of this consortium? Is this something you would consider with the right cost overrun protections, or are you just really focused on recontracting like Point Beach and Seabrook?
John W. Ketchum
Yeah. So, let me take those in pieces. So, the first part, you’re right. Turkey Point is kind of an unusual position because Turkey Point 6 and 7 already have their licenses, right and you see kind of skip to the front of the line on seven to eight years of approvals that would otherwise be required. So, we’ve always had Turkey Point as a, what I’ll call, a natural gas fuel hedge. If we wanted to do something there around an AP1000. That being said, for us, I think we would probably be more inclined to toe in the water maybe an SMR down at Turkey Point rather than an AP1000. We would do it in a way where we could combine like I always like to talk about the four wallets, right, which is the OEM, the developer, the hyperscaler, and the federal government, because we have to, one, be comfortable with the technology and the technical feasibility of it, will it work at the end of the day? And number two, as we keep saying, it has to be structured in a way that protects our customers and protects our shareholders. And so, that’s what we would like to do. We would not be interested in doing that together with a consortium. We have a lot of experience here. We feel very comfortable in our ability to do this on our own, but you got to get the insurance tower, so to speak, right, in terms of who takes that ultimate cost overrun risk. And so, beyond Turkey Point, and if you think outside of Florida, we are working closely with SMR, OEMs, and with hyperscalers.
You know we have our national collaboration with Google, for example, around advanced nuclear. We’re looking together with Google at where that might make the most sense. We have 6 gigawatts of SMR capacity at our existing sites. We have the ability to greenfield development as well. But again, any of those opportunities have to include those four wallets, and we have to get the technical and the commercial risk sharing right for those to advance.
Shar Pourreza
Got it. I guess your view is despite the learning curves of Vogtle, the SMRs are still more economical than an AP1000.
John W. Ketchum
Yeah, I mean, I just, I look at it. There’s two types of SMRs, right? There’s Gen 3s, which are just what I would call a downsized AP1000, right? So, you’re looking at building an AP1000 just in a smaller chunk in a little bit of a smaller bet. GE’s got the Ontario project going on now. There’ll be a lot of lessons learned coming out of that. And the Gen 4s really are you’re taking two-step changes around a Gen 4. Gen 4 is the technology, which is not really an extension of an AP1000, the tried, proven. And you’re jumping into an additional fuel risk with the highly enriched uranium, which we still haven’t really perfected in this country. So, our focus would be more around the Gen 3 technology.
Shar Pourreza
Got it. And then just lastly, on Point Beach, we’re getting close to when a decision needs to be made on the PPA, especially for the offtaker, who’s going to need to plan ahead on new generation needs if the PPAs aren’t renewed. I guess, how are the dialogues going with, do you have an interest there from a hyperscaler? I guess, when can we get an update on Point Beach? Thanks.
John W. Ketchum
Yeah. Thanks, Shar. There is a lot of interest for Point Beach as you might imagine, right? I mean a lot of interest from a number of folks. And so, we are just being diligent and making sure that we make the right decision around Point Beach. I’m not going to call out who exactly we’re talking to, what the names are, but needless to say, just a lot of interest around that asset for obvious reasons, given where it’s located and all the hyperscaler opportunities around it and so discussions are continuing to progress there and we like what we see and it’s an attractive and a valuable asset.
Shar Pourreza
Got it. Fantastic. Thanks, guys. Appreciate it.
John W. Ketchum
Thank you, Shar.
Operator
The next question is from Bill Appicelli with UBS. Please proceed.
Bill Appicelli
Hi, good morning. Just addressing the backlog update. I think you’ve seen some strong progression here from about 3 gigs in Q3 to 3.6 to now 4 gigs. So, would you say this reflects some acceleration of the contracting ahead of the tax credit roll-offs at the end of the decade or is this just underlying demand being exceedingly strong, irrespective of the tax credits?
Brian Bolster
It’s Brian. I’d say, at this point, we haven’t actually stepped into the acceleration yet. This is just a reflection of some of the growth that we’ve seen out in the market. And so, it’s really the reflection of the growth as opposed to the acceleration. Hope, we’ll probably see that as we start to move out here in the coming quarters. But this is just kind of fundamental demand for fundamental growth that’s tied to what’s the best economic answer for the demand that’s in front of us, as opposed to people trying to move in, in advance of the tax credits.
John W. Ketchum
Yeah and the other thing I would add to that is, I made comments in the prepared remarks about where we stand in our supply chain, right, with solar panels bought through 2029 transformers through the end of the decade, batteries through 2029, wind components, so on and so forth. We are so well positioned to capitalize on this backing demand that we see coming, which is going to, I think, going to be a fantastic opportunity for this company. And you combine that with the safe harbor position that we already have, that we were quite aggressive on a while back. I just can’t imagine there’s any company in America better positioned to seize upon the demand that we are going to see over the next three to four years and beyond for renewables and for storage particularly given how long it’s taking to build gas-fired generation in this country. And like I keep saying, we’re building it all. We’re a big believer that gas is needed and it’s going to provide a big impact, but it’s not quick, right, to get to market, and solar and storage are. And we have positioned our company around the ability to seize upon those opportunities. I think you’re seeing the first showing of that here this quarter, and we look forward for many more strong quarters to come.
Bill Appicelli
So, there’s upside to a 4 gig a quarter run rate, I guess, is another way to put that?
John W. Ketchum
Well, you said it, I didn’t, but we feel really, really good about where we sit.
Bill Appicelli
Okay. And then, just shifting gears, outside of the Texas and Pennsylvania projects, can you just speak a little bit to the gas generation new build contracting? I know it’s sort of subsumed in some of the hub strategy, but it does seem like there’s some complexities in the market around getting deals announced on your new builds gas contract. To your points that you just made there in those in my prior question, is there anything you can point to in terms of gating factors? Is it just the complexity around managing fuel risk or is it getting the offtakers to be able to commit to that? Just curious there.
John W. Ketchum
Yeah. No, I mean, look, I think that gas build-out continues to advance around the country. But remember, we were starting gas-fired generation development, we being the industry, right, from kind of a standing start a year or two ago. And so, we’ve seen manufacturing start to ramp up. We’ve seen EPC labor respond as well. But I think the biggest constraint that I see in the market right now is getting gas built faster is labor, right, it’s EPC contractors. We used to have 9, 10, 11 EPC contractors building gas plants back 10, 20 years ago. Some filed bankruptcy, some pivoted to other businesses. If you look at really what I would call the 4 EPC contractors that we do business with today, a lot fewer than what we’ve ever had and the squeeze on labor in the market today when you’re building a gas plant, pipe fitters, welders, so on and so forth, those same EPC firms are building LNG terminals. They’re building data centers.
They’re in other parts of the market and so lining up the labor, getting labor secured and in place, that’s a piece of it. And then depending on where you’re building, permitting we keep talking about permitting reform. We have got to get permitting reform done in this country. It is imperative that we get that done both for linear facilities and also just to expedite permitting at the state and the federal level. Those are the things more than anything that I think are contributing. The gas will be built, it will come online, and NextEra is one of the companies that will drive that. But it’s just not as fast as other forms of generation. So, that’s why we keep saying you need it all, right? You need to put it all together. When you get every electron on this grid as fast as possible, speed to power is essential and that will allow us to unleash American energy dominance across America.
Bill Appicelli
Great. Thank you very much.
Operator
The next question comes from Nick Campanella with Barclays. Please proceed.
Nicholas Campanella
Hey, good morning. Thanks for taking the questions, lot of good updates. So, I just wanted to ask quickly on the 1 GW you want to deliver on at FPL, is that already kind of in the plan and just, we noticed the capital expenditures are now $12 billion to $13 billion for 2026, and I think at the analyst event it was $10 billion to $11 billion. So, nice increase there and just wondering if that’s for the 1 GW you were already talking about. Is that kind of the new run rate we should expect going forward for FPL, understanding that I think you just reaffirmed the total capex outlook today. Thanks.
Michael Dunne
So, few things on, hey, Nick, Mike Dunne here, few things on that. I think firstly, we’ve not said how many gigawatts or gigawatt of large load we expect at FPL. I think we’ve only said that we expect to have a large load transaction finalized this year, and so — but we’ve not said if one gigawatt or what that number would be. Second piece is, as you do look at the capex increase, this is really aligned with what John said earlier about being prepared. So, as we brought in and secured solar supply, a piece of that solar supply is bringing that in today at locked-in prices to remove any trade impacts and we’ll be able to use that to cost-effectively serve our customers in Florida in the future, but that’s a piece that was pulling in some of those capital expenditures.
So, FPL situated extremely well for low cost to our customers by taking proactive measures to reduce any trade impacts.
Nicholas Campanella
Understood. Okay. Thank you. And then just maybe if I can, one follow-up on the Japan deal and framework is just, it’s our understanding that that’s a bit of a kind of capital light opportunity. They’re the owners, you’re the builders. So, just how would you kind of view the return of that opportunity to like the 13% and 20% plus equity IRR that you had out there at the investor conference? It’s just that the 9.5 GW is a very large number and trying to understand how that supports or accelerates the 8% plus EPS deal. Thank you.
John W. Ketchum
Right. To your first piece, remember, this is a capital light investment, essentially zero capital for us. So, from a returns perspective, it’s essentially infinite. We are putting no capital down, and we would potentially receive fee streams for a long period of time. Importantly, in order for us to capture that, our incentives are 100% aligned with the US government and with Japan, because we will need to perform in order to receive those payments. And they’re also through the duration of the asset, so they are not just development payments or construction payments, but also ongoing O&M payments. As you look at what those fees can be and what that value can be to NextEra, I think we’d like to take the time to make certain that we have the contracts in place before we know what that will be. But we are looking at making this time investment and working through these because they can be value accretive to our shareholders.
Nicholas Campanella
Thank you.
Operator
[Operator Closing Remarks]