Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2023

Derivative [Line Items]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The tables below present NEE's and FPL's gross derivative positions at March 31, 2023 and December 31, 2022, as required by disclosure rules. However, the majority of the underlying contracts are subject to master netting agreements and generally would not be contractually settled on a gross basis. Therefore, the tables below also present the derivative positions on a net basis, which reflect the offsetting of positions of certain transactions within the portfolio, the contractual ability to settle contracts under master netting arrangements and the netting of margin cash collateral, as well as the location of the net derivative position on the condensed consolidated balance sheets.

	March 31, 2023
	Level 1		Level 2		Level 3		Netting(a)		Total
	(millions)
Assets:
NEE:
Commodity contracts	$	3,433	$	6,071	$	2,217	$	(8,486)	$	3,235
Interest rate contracts	$	—	$	372	$	—	$	(15)	357
Foreign currency contracts	$	—	$	—	$	—	$	—	—
Total derivative assets									$	3,592
FPL – commodity contracts	$	—	$	7	$	30	$	(5)	$	32
Liabilities:
NEE:
Commodity contracts	$	5,308	$	6,136	$	1,761	$	(9,829)	$	3,376
Interest rate contracts	$	—	$	495	$	—	$	(15)	480
Foreign currency contracts	$	—	$	144	$	—	$	—	144
Total derivative liabilities									$	4,000
FPL – commodity contracts	$	—	$	6	$	41	$	(5)	$	42
Net fair value by NEE balance sheet line item:
Current derivative assets(b)									$	1,682
Noncurrent derivative assets(c)									1,910
Total derivative assets									$	3,592
Current derivative liabilities(d)									$	1,512
Noncurrent derivative liabilities(e)									2,488
Total derivative liabilities									$	4,000
Net fair value by FPL balance sheet line item:
Current other assets									$	21
Noncurrent other assets									11
Total derivative assets									$	32
Current other liabilities									$	22
Noncurrent other liabilities									20
Total derivative liabilities									$	42

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(a)Includes the effect of the contractual ability to settle contracts under master netting arrangements and the netting of margin cash collateral payments and receipts. NEE and FPL also have contract settlement receivable and payable balances that are subject to the master netting arrangements but are not offset within the condensed consolidated balance sheets and are recorded in customer receivables – net and accounts payable, respectively.

(b)Reflects the netting of approximately $124 million in margin cash collateral received from counterparties.

(c)Reflects the netting of approximately $122 million in margin cash collateral received from counterparties.

(d)Reflects the netting of approximately $620 million in margin cash collateral paid to counterparties.

(e)Reflects the netting of approximately $969 million in margin cash collateral paid to counterparties.

	December 31, 2022
	Level 1		Level 2		Level 3		Netting(a)		Total
	(millions)
Assets:
NEE:
Commodity contracts	$	5,372	$	7,559	$	2,094	$	(12,030)	$	2,995
Interest rate contracts	$	—	$	583	$	—	$	(49)	534
Foreign currency contracts	$	—	$	—	$	—	$	(4)	(4)
Total derivative assets									$	3,525
FPL – commodity contracts	$	—	$	11	$	25	$	(7)	$	29
Liabilities:
NEE:
Commodity contracts	$	7,185	$	7,620	$	2,948	$	(13,010)	$	4,743
Interest rate contracts	$	—	$	191	$	—	$	(49)	142
Foreign currency contracts	$	—	$	130	$	—	$	(4)	126
Total derivative liabilities									$	5,011
FPL – commodity contracts	$	—	$	4	$	16	$	(7)	$	13
Net fair value by NEE balance sheet line item:
Current derivative assets(b)									$	1,590
Noncurrent derivative assets(c)									1,935
Total derivative assets									$	3,525
Current derivative liabilities(d)									$	2,102
Noncurrent derivative liabilities(e)									2,909
Total derivative liabilities									$	5,011
Net fair value by FPL balance sheet line item:
Current other assets									$	19
Noncurrent other assets									10
Total derivative assets									$	29
Current other liabilities									$	12
Noncurrent other liabilities									1
Total derivative liabilities									$	13

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(a)Includes the effect of the contractual ability to settle contracts under master netting arrangements and the netting of margin cash collateral payments and receipts. NEE and FPL also have contract settlement receivable and payable balances that are subject to the master netting arrangements but are not offset within the condensed consolidated balance sheets and are recorded in customer receivables – net and accounts payable, respectively.

(b)Reflects the netting of approximately $299 million in margin cash collateral received from counterparties.

(c)Reflects the netting of approximately $262 million in margin cash collateral received from counterparties.

(d)Reflects the netting of approximately $328 million in margin cash collateral paid to counterparties.

(e)Reflects the netting of approximately $1,213 million in margin cash collateral paid to counterparties.

Significant unobservable inputs used in valuation of contracts categorized as Level 3

The significant unobservable inputs used in the valuation of NEE's commodity contracts categorized as Level 3 of the fair value hierarchy at March 31, 2023 are as follows:

	Fair Value at				Valuation	Significant				Weighted-
Transaction Type	March 31, 2023				Technique(s)	Unobservable Inputs	Range			average(a)
	Assets		Liabilities
	(millions)
Forward contracts – power	$	309	$	547	Discounted cash flow	Forward price (per MWh)	$(10)	—	$441	$51
Forward contracts – gas	296		90		Discounted cash flow	Forward price (per MMBtu)	$2	—	$17	$4
Forward contracts – congestion	71		23		Discounted cash flow	Forward price (per MWh)	$(21)	—	$27	$1
Options – power	106		17		Option models	Implied correlations	44%	—	88%	53%
						Implied volatilities	46%	—	229%	94%
Options – primarily gas	614		481		Option models	Implied correlations	44%	—	88%	53%
						Implied volatilities	22%	—	145%	59%
Full requirements and unit contingent contracts	691		399		Discounted cash flow	Forward price (per MWh)	$4	—	$338	$70
						Customer migration rate(b)	—%	—	103%	7%
Forward contracts – other	130		204
Total	$	2,217	$	1,761

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(a)Unobservable inputs were weighted by volume.

(b)Applies only to full requirements contracts.

Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation

The sensitivity of NEE's fair value measurements to increases (decreases) in the significant unobservable inputs is as follows:

Significant Unobservable Input	Position	Impact on Fair Value Measurement
Forward price	Purchase power/gas	Increase (decrease)
	Sell power/gas	Decrease (increase)
Implied correlations	Purchase option	Decrease (increase)
	Sell option	Increase (decrease)
Implied volatilities	Purchase option	Increase (decrease)
	Sell option	Decrease (increase)
Customer migration rate	Sell power(a)	Decrease (increase)

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(a)Assumes the contract is in a gain position.

Reconciliation of changes in the fair value of derivatives measured based on significant unobservable inputs

The reconciliation of changes in the fair value of derivatives that are based on significant unobservable inputs is as follows:

	Three Months Ended March 31,
	2023				2022
	NEE		FPL		NEE		FPL
	(millions)
Fair value of net derivatives based on significant unobservable inputs at December 31 of prior period	$	(854)	$	9	$	170	$	8
Realized and unrealized gains (losses):
Included in operating revenues	1,208		—		(1,535)		—
Included in regulatory assets and liabilities	(17)		(17)		(19)		(19)
Purchases	214		—		183		—
Settlements	(304)		(3)		250		1
Issuances	(74)		—		(98)		—
Transfers in(a)	9		—		—		—
Transfers out(a)	274		—		(23)		—
Fair value of net derivatives based on significant unobservable inputs at March 31	$	456	$	(11)	$	(1,072)	$	(10)
Gains (losses) included in operating revenues attributable to the change in unrealized gains (losses) relating to derivatives held at the reporting date	$	797	$	—	$	(1,405)	$	—

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(a)Transfers into Level 3 were a result of decreased observability of market data. Transfers from Level 3 to Level 2 were a result of increased observability of market data.

Net notional volumes

NEE and FPL had derivative commodity contracts for the following net notional volumes:

	March 31, 2023				December 31, 2022
Commodity Type	NEE		FPL		NEE		FPL
	(millions)
Power	(130)	MWh	—		(104)	MWh	—
Natural gas	(839)	MMBtu	971	MMBtu	(1,307)	MMBtu	258	MMBtu
Oil	(44)	barrels	—		(38)	barrels	—

Not Designated as Hedging Instrument

Derivative [Line Items]

Derivative instruments, gain (loss) in statement of financial performance

Gains (losses) related to NEE's derivatives are recorded in NEE's condensed consolidated statements of income as follows:

	Three Months Ended March 31,
	2023		2022
	(millions)
Commodity contracts(a) – operating revenues (including $1,142 unrealized gains and $2,127 unrealized losses, respectively)	$	1,019	$	(2,389)
Foreign currency contracts – interest expense (including $15 unrealized losses and $4 unrealized gains, respectively)	(18)		1
Interest rate contracts – interest expense (including $517 unrealized losses and $489 unrealized gains, respectively)	(484)		471
Losses reclassified from AOCI to interest expense:
Interest rate contracts	—		(5)
Foreign currency contracts	(1)		(1)
Total	$	516	$	(1,923)

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(a)For the three months ended March 31, 2023 and 2022, FPL recorded losses of approximately $25 million and $12 million, respectively, related to commodity contracts as regulatory assets on its condensed consolidated balance sheets.