FPL, a subsidiary of FPL Group Inc., of Juno Beach, Florida, was seeking approval to spend about US$5.7 billion to build a 1,960-megawatt ultra super critical coal plant, capable of serving about 396,000 homes and businesses. FPL expected the units to enter service in 2013 and 2014.

The PSC pointed to "the large fixed costs that would be added to base rates for the construction and the uncertainty associated with future natural gas and coal prices."

State officials have expressed an interest in "clean coal" technology and diversifying the types of power plants to avoid an overreliance on natural gas. But electricity traders said the state was apparently balking at the price tag.

A spokesman for the company said this decision probably would force the company to build more natural gas fired generation, "putting all of its eggs in one basket."

If the company has to build gas-fired plants in lieu of the coal plant, FPL said that by 2016 it will be 70 percent dependent on natural gas, up from about 50 percent today, exposing customers to reliability and fuel price risks.

"We obviously misread the Commission's intention for fuel diversity and are hopeful they will provide us with clear and unwavering direction as to what they want us to do," Armando Olivera, president of FPL, said in the release.

The FPL spokesman said the PSC would post the order in about a week and the company would have about five days to appeal it to the PSC and about 30 days after that to appeal it to the state Supreme Court.

10-YEAR PLAN

In April, FPL filed a 10-year plan that would add about 6,700 MW of generation and diversify its fuel mix to meet anticipated customer growth and the rising demand for power.

FPL currently operates more than 24,000 MW of generating capacity and provides electricity to 4.4 million homes and businesses in Florida with a fuel mix that is 50 percent natural gas, 21 percent nuclear, 15 percent purchased power, 9 percent oil and 5 percent coal.

According to FPL's numbers, one megawatt powers about 200 homes and businesses.

In 2007, FPL expects to complete the US$600 million, 1,150 MW combined-cycle natural gas-fired plant at Turkey Point in south Miami-Dade County.

For 2009-2012, FPL recently started building the US$1.3 billion 2,400 MW of combined cycle gas-fired units at its West County site in western Palm Beach County, which should enter service in 2009.

For 2015-2016, FPL tentatively plans to add an additional 1,200 MW of combined-cycle gas-fired generation at a cost of about US$800 million.