FPL To Spend $2 Billion Improving Plants, Cut Work Force By 300

FPL Group Inc. (FPL) said its Florida Power & Light unit, the largest electric utility in Florida, will spend $2 billion modernizing two power plants despite a tough economy and cut 300 positions.

FPL has struggled of late amid a weak Florida economy and a difficult regulatory environment. It was recently downgraded by Moody's Investors Services and Standard & Poor's Rating Services.

Modernizations at the Riviera Beach and Cape Canaveral power plants will save customers $850 million to $950 million over the life of the facilities, said FPL. The new units will reduce particulate emissions by 88% at the sites and improve their carbon-dioxide emission rate by more than half.

The staff cuts amount to a reduction of less than 3% of the company's total workforce, it said, and are the result of sharply curtailed new-home construction. FPL estimated 425 employees will depart but selective hiring will partially offset that. It anticipates 220 employees will take buyouts.

FPL thinks "keeping operating costs in line while continuing to invest" in its infrastructure is the best long-term course, President and Chief Executive Armando J. Olivera said.

The stock closed at $50.69 Thursday and was inactive premarket. Shares have fallen 5.8% the past year.

-By Matt Jarzemsky; Dow Jones Newswires; 212-416-2240, [e-mail]