Thank you all for joining us. Welcome to the 2019 NextEra Energy and NextEra Energy Partners Investor Conference. I'm Matt Roskot, director of investor relations. Before we begin, a reminder that today's presentations contain forward-looking statements and references to certain non-GAAP financial measures. You should refer to the cautionary statements and risk factors, as well as the non-GAAP reconciliations in the appendix of today's presentations and our recent SEC filings. On page three of today's materials is an agenda for the conference. After Jim's remarks and Eric and Marlene's discussions of Florida Power & Light and Gulf Power, we'll take a short 10-minute break. Following the break and the remainder of the presentations, the entire executive team will be available to answer your questions. With that, I'd like to welcome Jim Robo.
Thanks, Matt. Good morning, everyone. Appreciate you being here with us this morning. I've been at NextEra now for almost 18 years, I have never been as optimistic and as confident about our future as I am today. We have two terrific businesses, two great franchises. Florida Power & Light, which I think is the best utility in the country. NextEra Energy Resources, the world's largest renewable developer. Both have terrific growth prospects. Feel very excited about the future there. We have a big role to play in the enormous change that's going on in our industry and the disruption that's going on in our industry. I'll talk about that today. I think most of you probably already saw that we've extended our expectations a year out through the end of 2022. 6%-8% growth off of our adjusted 2021 EPS.
That translates to about a $10-$10.75 a share EPS range. As usual, I will be very disappointed if we don't earn at the top end of that range. At NextEra Energy Partners, Mark Hickson reminded me of this the other day, it is almost five years to the day. June 26th, Mark, right? 27th. June 27th. Today is almost five years to the day of the NEP IPO. NEP is a terrific vehicle. It has tremendous growth prospects. I'll spend some time taking you through, then Mark will take you through in a lot of detail. Greater granted growth prospects, opportunities to acquire assets from NextEra Energy Resources, and third-party acquisitions. I don't think there's another vehicle in the S&P 500 that has visibility on distribution growth through the middle of the next decade.
I think you all saw this morning that we extended our LP unit distribution growth expectations of 12%-15% for NEP through the end of 2024. With that, I want to take you through a few things this morning. First of all, I'm going to spend some time on the NextEra Energy value proposition. I'm going to spend some time on a topic that is really critical and really important to our growth, but one I don't get a lot of questions about, particularly from this audience, and that is our culture. I'm going to take you through the NextEra playbook and how that playbook is playing out at Gulf Power. Marlene will take you through in a lot more detail what we're doing at Gulf Power, but I think what's happening at Gulf is a very instructive insight into the NextEra culture.
I'm going to spend a lot of time talking about how do we continue to grow this company. This is a big company by any measure, right? We're going to have $120 billion of assets at the end of this year at NextEra. Of course, some pretty big growth aspirations. How do you grow a very big company? I'm going to talk about that. Take you through the NEP value proposition and the various sources of growth there. I'm going to end with our outlook. I'm not going to take you through this in a lot of detail. Obviously, two years ago, we laid out a variety of expectations for NEE at our investor conference, and we really delivered. I'll talk about this a lot this morning. We say what we do, we do what we say.
Delivering on our commitments is a very big part of our culture at NextEra. Whether it was growing EPS, we grew EPS close to 12%. There was a tax good guy there that obviously wasn't necessarily embedded in our numbers in 2017. Even without it, we grew faster than 8% on an EPS basis in that period. We grew dividends right in the middle of where we said we would. We've continued to have one of the strongest balance sheets and highest credit ratings of any utility in the U.S., and all three rating agencies recognized our improvement in our business risk profile. At FPL, we continue to deliver on our customer value proposition. Bills continue to be 30% below the national average, 8% lower than they were in 2008.
Not a lot of things that you can buy that are almost 10% lower in nominal terms than they were more than a decade ago. Enormous O&M efficiency. We were the best O&M at FPL. We had the best O&M position of any utility in America in 2016. It got 10% better. That is an insight into our culture. We are never satisfied. We have a drive every day to get better. There is no better example than what the team has done at FPL in terms of O&M efficiency over the last several years. We've used the dollars that have been freed up by that O&M efficiency to continue to invest capital in our business that's good for customers, that delivers reliability, that delivers lower costs ultimately, that delivers lower fuel. We've grown regulatory capital employed by 11% over that period of time.
FPL really has delivered on its commitments over the last several years. At Energy Resources, we made terrific progress on the commitments we made in 2017. Our best renewable origination period in our history, we signed contracts for more than 10,000 megawatts in 2017 and 2018. It took us 15 years to get to 10,000 megawatts installed. We signed 10,000 megawatts of contracts in 24 months. Enormous progress in our storage business. We're still very much in the early innings there, but you'll see in a minute that we have great aspirations there. We're making great progress. 40% of the contracts we signed last year in solar had an energy storage component. We're very successful in recycling capital as well, over $5 billion. Everything we have at NextEra Energy is for sale. I am not wedded to any asset.
If someone offers us a price for an asset that is more than what we think the whole value of that asset is for us, we will sell it and we will recycle the capital. That is absolutely a big part of our culture, that financial discipline around capital allocation. On natural gas pipeline development, obviously MVP has been a miss over the last 2 years. I don't think any of us expected that we were going to have to essentially permit large swaths of that pipeline twice. Nonetheless, we're making good progress there. John is going to take you through more details on it. Fundamentally, we feel like we're going to get the pipe in by the end of next year.
There is going to be no more valuable pipe when it is built than that pipe, given how hard it is now to build pipelines on the East Coast. We also made tremendous progress on regulated acquisitions. Over $7 billion of regulated acquisitions over the last 2 years. We continue to be very opportunistic here. These are the first regulated acquisitions, actually, that we have closed in our history as a company. Very happy about that, but we remain opportunistic there. I'll talk a little bit more about that in a minute. Nonetheless, you're going to see as I take you through the NextEra playbook, the way we think about doing regulated acquisitions and how applying that playbook creates value for shareholders and for customers going forward. We're now one of the largest companies in the country. We're the fifth largest capital investor in any sector.
We're obviously the largest capital investor in the utility sector, but last year we were the fifth largest capital investor in any sector. Our renewable business, there's no one bigger in the world. There's only seven countries in the world that own more wind than we do. We own more wind than Brazil. We own more wind than is installed in Canada. We own more wind than what's in France. That gives us great scale and an unbelievable competitive advantage in the renewable business. Over the last 15 years, we've had a terrific track record of continuing to grow earnings. We've grown earnings almost 8% a year over that 15-year period. This is an industry where, if you look back over a long period of time, if you look back over 20 years, the average EPS growth is closer to zero.
Over the last 15 years, it's been about 3% when you exclude us and you look at the top players in the S&P Utilities Index. Yet, when you look at the average forward expectations, this is an industry that says they're going to grow at 7%, even though the history is they grow at 3% at best. We say what we do, we do what we say. We said we were going to grow at 8%, we have grown at 8%, we continue to grow at 8%, and we've delivered. On top of that, we have better quality of earnings than anyone in the sector. This is a chart. I showed you this chart 2 years ago.
We've updated it over the last 15 years, top 10 players in the space. On average, other than the two companies who had GAAP earnings more than adjusted earnings, we were one of them, obviously. Our GAAP earnings were higher than our adjusted earnings. Our adjusted earnings we reported have actually been lower than our GAAP earnings over that period of time. On average, you can look at the rest of the top 10, it's almost 10 or 15. They've excluded bad guys with almost 10%-15% of their total adjusted earnings over that period of time. We have a higher quality of earnings than almost anyone in the space as well. We have a long-term track record of delivering value to shareholders.
We've beat the S&P Utility Index and the S&P 500 Index on a one-year basis, on a three-year basis, a five-year basis, a 10-year basis. There is no management team that is more aligned with shareholders than this one. On a 15-year basis, not only have we outperformed the S&P 500 and the S&P Utility Index, we've more than doubled the median return of the S&P Utility Index over that period of time, 900% TSR over 15 years. We've almost tripled the S&P 500 TSR over that period of time. Probably the thing we're the most proud of is that a utility has outperformed 83% of the S&P 500 over that 15 years. A utility. We've been able to take 15 years ago what was, in size at least, a middling utility, and we're now the biggest utility in the world by market cap.
That's something we're very proud of. One of the really important elements of our culture is, while we may be proud of our track record, we're never satisfied. We know we can do better. We are always focused on the future and getting better every day. With that, I want to spend some time talking about the NextEra Energy playbook and talking a little bit about our culture. I've been very blessed that I followed two great CEOs. In the last 31 years, this company has had three CEOs. Jim Broadhead came in in 1988. He brought a focus on cost and continuous improvement and financial discipline that are still hallmarks of our culture today. Lew Hay became CEO in 2001. He brought a focus on growth, and at the same time, made that really critical decision to pivot to clean.
I like to think in the last seven years, I've had us have a focus as a company on how do we be great both at growth and at cost at the same time. One of the key things that I look for in leaders in our company, my leadership expectation for those leaders. The first one is great at cost and great at growth. It's easy to be good at cost at the expense of growth, and it's also easy to be focused on growth without worrying about profitability. It's a lot harder to be great at both, and that's a hallmark of the NextEra Energy playbook in our culture. Another big element of our strategy has been, as I said, a focus on clean and on being economic. What do I mean by that?
We have, for more than 20 years, had a strategy from a generation standpoint, in particular, that we were going to be clean, but also that we were going to do economic things for our customers, whether they be our customers in Florida or our customers outside of Florida, NextEra Energy Resources. This company is living proof that you can be clean and low cost at the same time. That you can be clean, not only is it free, it's lower cost. I think that is something this industry still has yet to really embrace after 20 years. Not only is it free, it's lower cost. Those elements of our strategy revolve around a culture that is focused on our talent and building talent and building great talent and customer-focused at the same time.
Those are the building blocks for some of the tactics that we use to implement those strategies. Things like great execution. I'm going to talk a little bit about what I mean by that. A focus on benchmarking. I can tell you where we stand in every process in our company, relative not only to other utilities, but to the best process owners in the world. Financial discipline, always a hallmark of what we do in all of our investments and how we run our company. You combine that with our tactics on growth. Focus on innovation, focus on toe-in-the-water investments first in new growth opportunities, and a focus on building commercial skills. You put all that together on a base of a culture that delivers on its commitments. We say what we do, we do what we say, we have a culture of delivering on our commitments.
Let me talk about execution. I'm going to start with safety. There's nothing more important in our company than the safety of our employees. That is job one for us. I'm very proud of this track record we've been able to take. We've been able to improve safety by 80% over the last 15 years. Show me a company with a great safety record, and I will show you a great company. The vice versa is true as well. A few weeks ago, the team sent me a newsletter from 1952. We still have those, I guess. It was a newsletter that went out to the company talking about our first FPL storm dry run. We have been doing storm dry runs in this company for more than 65 years. Now by virtue of geography, we've had a lot of practice. We learn from every storm.
In a lot of ways, how we execute in those storms is really, I mean, I think, a key measure of it is what we do, right? I mean, we, in the toughest times, owe our customers our best. We have a history of executing on storms. Eric's going to talk a little bit about it in more detail. Another example of execution, again, doesn't get a lot of focus. Our engineering construction team very quietly over the last 15 years has built 181 projects on average under budget and on average ahead of schedule, and maybe most importantly, 123 win projects that didn't miss a COD date or didn't miss a PTC cliff. These are great examples of our focus on execution, really critical to our success. Cost.
I had the team go back a long way on cost because I think it's a really interesting perspective into how we've run this company over the last 30 years. Go back to 1988. FPL not only wasn't an average company from a cost perspective, it was worse than average. You can see its position. It was almost 10% worse on average on O&M per megawatt hour. We've made great progress through the years. Today, we're 62% lower than the industry. On a nominal basis today, we are lower than we were in 1988. Think about that. Nominal dollars were lower than we were, and this is an industry that essentially has never gotten the cost message. In 30 years, this industry hasn't gotten the cost message. You see what's happened.
One of the things that I'm most proud of is you can look at where we were in 2012 and what we've done to put a kink back in that curve over the last seven years. How have we done that? We've done it with a process that today we call Project Accelerate. It started out as Project Momentum. It is a bottoms-up idea generation process that we do every year. We've evaluated over 11,000 ideas over the last several years since we started. Over 5,000 ideas have been implemented. A $1.4 billion run rate cost savings. This has been an amazing process and a focus on continuous improvement, a comprehensive look at our whole business every year. Every year we do this, and it is a big part of the culture and a big part of the reason why that we continue to get better.
As I said, FPL got better from 2016 to 2018. You know what? In 2019, we're better so far year to date than we were last year, too. That's been an enormously important part of the playbook, is the ability to focus on execution and to focus on cost. The next big thing for us is going to be digital, technology, machine learning, artificial intelligence, big data. I'm not going to spend a lot of time taking you through examples because both Eric and John are going to take you through several examples. We've got a couple of videos to share with you today of what we're doing in the company around this. Two years ago, we launched an initiative. I said we needed to get better at this. We needed to get smart about this.
I got up in front of the management team, and they will tell you, I said, I admitted to them, "I have no idea what this is going to look like." Many of you know I'm not necessarily the most technologically forward person in the world. Today, we have over 100 projects. Our wind business is a big data business. This technology, this focus on these technologies, big data, AI, machine learning, is going to be two things. It is going to be the next step in how we continue to get more efficient and improve our business, and it's going to continue to differentiate us from the competition and continue to build our competitive advantage. I'm very excited about what we're doing here. You'll see some more on that today. Another big hallmark of the playbook is smart capital deployment.
Across the board, whether it's in wind and solar, whether it's in the smart grid, storm hardening, generation modernization, gas pipelines, all of this capital has had at its core two things. Projects that were good for our customers, whether they were in Florida or outside of Florida, delivering good economics to our customers, and at the same time, good returns for our shareholders. Financial discipline is a huge part of our culture. It starts with balance sheet strength. We've always had a strong balance sheet, I've always been committed to having a strong balance sheet, and I always will be committed to having a strong credit rating and a strong balance sheet. It is a key part of the strategy for us, and it always has been.
We expect to continue to have a regulated business mix of around 70%, and we're going to continue to be focused on opportunistically recycling capital. Balance sheet strength, a really core part of the playbook in our strategy. Running the business. We have a very detailed monthly operating review. I'm sure you all hear that from every name you cover, right? Detail. Everyone does operating reviews, right? I told you I'm not very technology forward. Everyone else has this on their iPads now. This is what we go through, more than 500 pages every month, all day. I can tell you where each of our businesses stands, each of our business units stand against all of their metrics every month. You can imagine, and the folks here can attest to that, we don't spend a lot of time on the things that are going well.
We spend most of that time on the things that aren't going well, and how do we fix them and how do we get better. Detailed monthly operating reviews, a core part of our rhythm, core part of how we run the business. Disciplined risk management is also a big piece of how we run our business. I think many of you know we do a long-term forecast. We review that forecast every month in that monthly meeting. We have a very disciplined approach to running the business. Disciplined capital allocation. In my view, there are three things that CEOs do. There's a lot of things a CEO do, but three number one things. Talent development, execution, and capital allocation. A lot of you would argue that capital allocation is number one, and I would argue back that I think all three are really critical.
Fundamentally, we have a really disciplined capital allocation process. Realistic assumptions. What we call P 50, look ourselves in the eye, say these are really realistic assumptions. Data-driven, high-return thresholds. Everything we do has to meet the market test. Everything in John Ketchum's business, in Energy Resources, has to be able to attract third-party financing. If we can't meet the market test in a project, we're not going to do it. It's that simple. Let me spend a minute and talk about corporate M&A. Obviously, we've been very active over the last several years, some successfully, some maybe not so successfully. I would tell you, though, that we've learned from every one of those exercises. Fundamentally, we remain very opportunistic. We do not have to do regulated acquisitions. We don't have to do M&A. We have terrific organic growth prospects.
Whatever we do, number 1, it will be opportunistic. Number 2, always has to be accretive. You will never see me announce a transaction that fills a hole or that we say, "Hey, it's strategic. Don't worry. It's dilutive." Always has to be accretive. Always has to make sense. Has to be in a constructive regulatory environment. We'll always be disciplined. I think you know that we have been, and our track record has been very disciplined on the M&A front. Another part, as I talked about our culture, is being focused on clean and overall our ESG approach. ESG is really embedded in everything we do. We have a culture of doing the right thing. It's one of our key values. We've done well by doing good. Very proud that we were the first to receive a best-in-class assessment from S&P's new ESG evaluation around preparedness.
Very proud of our track record, particularly on the clean front. I don't think there's any company in any industry who's done as much NextEra to address CO2 emissions. When you put all of that together, you have a culture that's focused on our people and our talent, it's focused on our customers, and it's focused on setting big goals, getting better every day, having accountability in everything we do. That's the playbook. Now I want to switch gears a moment and talk about how are we going to implement that playbook at Gulf? I think it is a real window into the culture of this company to understand a little bit. Marlene's going to take you through in a lot more detail than I will on these two slides.
Let me start with, in January, we closed. Our accounting team came to me and said, "We can report Gulf in a new regulated segment, and we'll combine FPL and Gulf in a single regulated segment, and it'll all get mushed together." I said, "You know what? I hate that." I want all of you, all of our stakeholders, our investors, our customers, I want everyone to see, to be able to have visibility into how we do with Gulf. We set it up as a separate segment. The two key hallmarks of the playbook, taking cost out, being more efficient, to use that to fund great capital investments for customers. That's playing out right now. We will, by 2021, and I want to set these goals, I want to be very clear with these goals.
I said to the team, I wanted to be very clear publicly with what these goals are. I want you to hold us accountable against these goals. That we will get their costs to $14-$15 a megawatt hour by 2021, close to where FPL is today, not quite there yet, but close. That we'll deploy a couple billion dollars of capital over the next three years, grow regulatory capital deployed by about 16%, and have great outcomes for our stakeholders and our customers and our shareholders. We're going to have service reliability that's going to be 20% better, CO2 emission rate that'll be 40% better by 2021. Perhaps most importantly, customer bills, they're going to be 9% better in real terms by 2021.
Then once we've had a chance to implement some of the projects that we're going to be building over the next few years, by the mid-2020s, a bill target of the mid-$120s, so about a 20% reduction in real terms over that period of time. We will grow net income at Gulf over the next several years at about 16% a year, just like we told you when we did the acquisition. Somewhere between $240 million-$260 million of net income. Team's rolling up actually to a number that's a little bigger than that. That's okay. Great outcomes for customers, great outcomes for shareholders. This is a window into how we think about regulated M&A, and it's a window into our culture and how we think about running our business. Let me talk about growth. That's a huge part of our culture.
It's been a big focus of our company for more than 20 years. It all starts with a vision. That vision has been the same for many years, and that is to be the largest, most profitable, most capable clean energy provider to have the best skills and capabilities of anyone in the industry. At FPL and Gulf, to have the best utility franchises in the country. At NextEra Energy Resources, to be the best renewable developer in the world. To leverage those two great businesses, and the scale we have, and the scope we have in those businesses to develop multiple new growth platforms across the board. We have, over the last 20 years, essentially started toe in the water, very toe in the water in each of these, a new business every year. Here's six examples.
Our wind business, when Lew made that pivot, was very small. It's now an enormous business. We expect it to be somewhere between 20-23 gigawatts of installed capacity by 2022. Solar. Solar didn't exist. We invested in the first solar project ever done in the U.S. in the early 1990s, and we owned that. It was 75 megawatts, I think. I went to visit that in the first year I was CEO of NextEra Energy Resources, and I said, "We need to get bigger in solar." We bought another one of them. Then through some fits and starts, we're now the biggest solar player in the country. FPL just announced 30 million panels by 2030. We're going to add 10 gigawatts of solar at FPL on a 26-gigawatt system by 2030. Totally revolutionized what we're doing at FPL. Our transmission business, same story.
Didn't exist 10 years ago. We're going to have $3 billion deployed there by 2022. Storage. Super excited about storage. Not only have we announced the world's largest storage facility at Manatee in Florida, we have several big storage facilities that we're going to be building in John's business. We have a big storage business. This is the holy grail of the renewable business. To figure out how to pair storage with solar and wind and deliver near-firm capacity to our customers. FPL Energy Services, that was a business that made no money when I came to the company 18 years ago. It's going to make $45 million-$50 million this year. By 2022, it's going to make $65 million-$70 million. In gas pipelines, we'll have $7 billion invested in a business that didn't exist seven or eight years ago.
We are terrifically positioned to continue our track record of growth. I am not going to take you through every one of the bubbles on this chart other than to say at FPL, I am very excited about what we are doing in solar. I am very excited about the opportunity we have to improve reliability and our resiliency through storm hardening. At Energy Resources, I am going to talk some more about the great growth we are going to have in renewables and in storage. When you put it all together, $50 billion-$55 billion of capital deployment from 2019-2022. That is $12 billion-$14 billion of capital a year. Let me put that in perspective for you. $55 billion is bigger than every company in the S&P Utility Index, other than eight. Think about that.
We will add in the next four years, more assets than 20 of the 28 or 19 of the 27, however many folks there are in the S&P Utility Index now, over the next four years. No one in the industry has better growth prospects than we do. At FPL, the focus is going to continue to focus on cost, continue to focus on reliability and delivering low bills to customers. At the same time, finding new projects that deliver great outcomes for customers and great outcomes for shareholders. We are going to grow regulatory capital employed over the next four years at 9% a year at FPL. At Energy Resources, we are going to continue to build our wind storage and solar pipeline and portfolio, going from 18 gigawatts to 27 gigawatts to 34 gigawatts by the end of 2022.
Going from $6 billion in transmission and pipelines to $9 billion-$10 billion in 2022. Put all that together, building on the competitive advantages that we have in this business. John is going to spend a lot of time talking about those. I will not today. We are going to grow adjusted earnings at Energy Resources over that four-year period of 12% a year. I spent a lot of time two years ago talking about disruption. All the different things that are disrupting this industry. There is enormous change going on in this industry. If anything, and these headlines are just a couple examples, if anything, it has happened faster than even we thought would in 2017. Let me take you through some of the things. I am going to end on generation restructuring, because I think that is really critical to the story. But there are several elements of disruption going on.
Let me start with shale gas. There are a lot of folks in this industry that still have not figured out that natural gas prices are going to be low, or at least they are not acting that way, that natural gas prices are going to be low for a very long time. It is still disruptive. Shale gas is still disruptive in this space 15 years later, and a lot of folks in our industry still have not figured that out yet. Smart grid. Very excited about what we can do there. You are going to see some things in Eric's video of what we are doing. Really disruptive. All of the technology that I talked about, big data, AI, machine learning, those things are going to change what the utility industry looks like five years from now and 10 years from now. Two years ago, I had shareholder activism on this chart.
My team begged me not to put it on at the time. You know what? It turned out there's been a lot of it over the last two years, even in the utility space. I expect that there'll be more going forward. Someday, this industry's going to wake up and realize there is enormous cost to be taken out, and there will be cost restructuring that will happen. That will be a great thing for customers and a great thing for the folks who figure out how to restructure this industry from a cost standpoint going forward. Most importantly, from a disruption standpoint, there are enormous trends in renewables and storage that mean that post-2023, without incentives, wind plus storage, solar plus storage, brand-new wind plus storage, brand-new solar plus storage, is going to be cheaper than existing coal and most existing nuclear.
By 2030, this is one forecast, it's an NREL forecast of high renewable penetration. It's got 40% penetration. I think it's going to be more than that. 8%-40% is a 15%-a-year CAGR in megawatt-hour growth over that period of time. There is enormous change coming in this industry. I don't think the industry really has come to grips with it. We're at the leading edge, and it is going to help drive tremendous growth for this company over the next decade. Just one more thing on that forecast. I had the teams go back and look at third-party forecasts, and this is EIA. I pick on EIA only because they have the misfortune of actually having done a forecast for 30 years. You can go back, and you can look at it. This chart, 2014.
In 2004, the green bar said EIA forecast of solar in 2014 would be a gigawatt. In 2009, their 2014 forecast was a gigawatt. Of course, you can see it was 10 gigawatts as it turned out, and the same across the board. We have, as an industry, completely missed the boat on the speed with which renewables have penetrated, and I think we could have even more renewable penetration than what I showed on that last graph. It is a huge disruptive force in this industry, and it's going to be an enormous driver of growth for this company. Let me spend some time talking about NextEra Energy Partners. Two years ago, we came and we said we were going to grow LP unit distributions by 12%-15%. How have we done? We've grown them by 15% over that period of time.
We've delivered on our EBITDA, adjusted EBITDA, and CAFD expectations over that period of time. We've delivered on our asset acquisitions. We've delivered on some of the most creative financing to finance that growth. We have one of the most creative and talented teams in our company focused on that. They've done a tremendous job of financing this vehicle over that period of time for the benefit of unit holders. We made some governance changes that I think have been very beneficial for unit holders. It's got a great portfolio. We've grown distributions by 160% since the IPO, and we've levered the same playbook that we've used at NextEra Energy. It's the same playbook. It's a focus on clean. It's a focus on cost. It's a focus on talent. Like I said, we have some of our best talent in the company working on NEP.
NEP is a big company in its own right. It would be as big as several of the S&P 500 Utilities Index companies today. It's as big as NextEra Energy was 15 years ago in 2003. We have a long way to grow. I don't think many of the companies in the S&P 500 Utilities Index are going to grow at 15% a year through the middle of the next decade. It's a big renewable generator on its own, and it has terrific growth prospects. Mark's going to spend a lot of time going through each of these, but let me spend a minute. Organic growth prospects. We're announcing today some new organic growth at NEP. We have embedded in the portfolio, terrific organic growth prospects. We have the ability to grow from acquisitions from NextEra Energy, and we have the ability to do third-party acquisitions.
Just to put that in perspective, just on renewables, all of these disruptive factors that I'm talking about are going to position NEP for a tremendously long runway of future growth. It's got a 5 gigawatt portfolio near alone, when you include the backlog and what we expect to do over the next few years by the end of 2022, somewhere between four and six times the number of megawatts than what is in NEP right now. Existing other capacity today, there's 100 gigawatts. That's going to grow to 500 gigawatts. That is a huge market for us to play in. Mark's going to take you through that in a lot more detail, but that 15% growth, NEP plays in a market that's going to be growing at 15% a year, and I feel very good about its growth prospects.
Now, recently, there's been some headwinds for NEP, and that's been the PG&E bankruptcy filing. Mark, again, will take you through some more detail on this. I just want to say a couple things. First of all, I'm very confident that we're going to be able to resolve the PG&E issue favorably for NEP. You saw this week, we announced a tender for some debt. Mark will take you through some more details on that at Genesis. Embedded between the organic growth prospects that NEP has, that we've announced today, combined with the CAFD that is currently trapped in the PG&E assets. The combination of those two CAFD elements represents about a year and a half's worth of growth without NEP needing to do any other acquisitions.
There is embedded upside in the NEP portfolio that I think is not reflected in its unit price right now, and I remain, as I said, very confident that we're going to be able to resolve the PG&E issues favorably to NEP going forward. NEP and NEE really do complement each other. NEE offers NEP a great asset backlog, experienced management, and industry-leading operating experience and expertise. NEP offers NEE capital recycling opportunity. The ability to highlight the value for us of contracted renewable assets, and an ability for us, in a very tax-efficient way, to recycle capital and optimize taxes. We've had a terrific track record at NEP. This is since the IPO, double the S&P 500 Utilities Index TSR, double the S&P 500 TSR. Double them. We remain utterly focused on extending that track record going forward. Let me talk about the outlook.
I'll start with NEP. Today, as I said, we're extending that distribution growth outlook through the middle of the decade, through the middle of the next decade. 12%-15% a year of LP unit distribution growth through 12/31/2024. There is no company in the S&P 500 that has the kind of visibility and distribution growth that NEP does. Our adjusted EBITDA and CAFD expectations remain unchanged. You can see that with the drop that we did with the acquisition that NEP did earlier this year, that essentially we're on target for our 12/31 run rate CAFD without counting on any of the PG&E assets. As I said, those PG&E assets represent, combined with our organic growth, about a year and a half's worth of distribution growth upside embedded in this vehicle without the need to do any acquisitions.
At NextEra Energy, we're extending the outlook 6%-8% off the 2021 base, $10-$10.75. I'll reiterate, I'll be disappointed if we don't earn at the top end of that range in 2022. We're going to continue to grow the dividends. We're not updating the dividend policy today. Obviously, that's a board decision. We'll be updating our policy going forward in the first quarter of next year. Fundamentally, we have a low payout ratio relative to the rest of the industry. I would expect that we'll be able to continue to grow the dividend faster than we're growing EPS. Again, we'll be giving you an update on that in the first quarter of next year.
In total, Rebecca will take you through some more details on this, I don't think there's another company in the space that offers the kind of attractive risk-adjusted total return that we do. I'll end by simply saying this: I've never been more optimistic about our future. I've never been more confident in our ability to deliver on these expectations. I can promise you that myself and the management team is utterly laser-focused on delivering on these commitments and making both NextEra Energy and NextEra Energy Partners better every single day. With that, I'm going to turn it over to Eric, and he'll take you through the FPL story. Thank you.
Good morning, everybody. Great to see you, and thanks for taking the time to be here. I'm going to walk you through what's going on at FPL and what the opportunities and prospects are going forward. As Jim talked about, it's been busy and a lot has happened since the last time we all saw each other two years ago. This is an area I'm very proud of the company, having delivered on the commitments that we brought forward in 2017. We continue to provide bills that are among the lowest in Florida, among the lowest in the country, 50% on average below the national average. Our operational efficiencies continue to improve, which again, helps keeping those bills down. Also, we've executed around a lot of capital investment projects very well, making sure they've come in on time, under budget.
One of the areas that I want to spend just a moment on, because Jim talked to you about culture, is a little bit of our philosophy too, on how we run the business, and that's this virtuous circle. Many of you have seen this before, but I think it's worth spending just a few moments on so you really understand the business philosophy of how we run day-to-day operations. It really all starts with providing our customer the best value proposition possible. Low bills, high reliability, clean energy, great customer service. When you do that, you drive high customer satisfaction. High customer satisfaction leads to a regulatory environment which is much more welcoming than when people are really upset, and they're complaining to regulators or complaining to their legislators.
When you have that opportunity to have a really good, healthy regulatory environment, a healthy political environment, it gives you the opportunity to have the kind of conversations that we're able to have in front of the Public Service Commission, as well as legislators, local elected officials, all the stakeholders, about what the possibilities are for us moving forward, investing in new technology, doing things a little differently, and getting the kind of support that you get when you have credibility. That leads to a much stronger financial position, the ability to actually have a return on equity that can attract investment, maintain a strong balance sheet, which in turn allows you to make the kind of investments in technology, processes, approaches, which allows you to provide customer value that's second to none, and around you go.
It's really not complicated. But it really all turns on execution and being able to get it done. When you do, the payoff is huge. As Jim said, we're a large utility, no matter how you want to measure it. By sales, we're actually the largest utility in the United States. We cover half of the state of Florida geographically. Over 10 million people rely on us day-to-day for their electricity, and I'm going to talk a little bit about it in the slides to come. We're growing, both on the East Coast and the West Coast of Florida. The state is growing, and we continue to expand our footprint. Customer bills. Let me spend just a few minutes on this. Jim, again, touched on this, but I think it's really important to see what we've been able to accomplish through the focus and the execution.
We've actually been able to continue to drive bills down, keep them flat against everything else that seems to be rising. We touch our customers, well, through electricity delivery constantly, but a bill once a month. Every month, they get a chance to benchmark us and see how we're doing against everybody else, everything else that's touching their lives. Our bills are actually down over the last decade. As Jim said, think about it. Go to the store. What can you buy today that's actually 6% less than it was a decade ago? Not much. We're subject to inflation like everybody else, whether it's medical costs, whether it's the price for what we pay to our vendors because they're subject to medical costs, to cable, to home insurance, everything, all the prices are going up, but not on FPL bills.
This makes, again, a huge difference for our customers because it gives them more disposable income in their pockets, which they turn around and invest in the economy. How do we do that? Really through smart capital investment, which allows us to ultimately take costs out of the business. You can see in the last decade, we've invested over $40 billion in Florida at FPL in a variety of different technologies that have allowed us to, again, drive costs out of the business and provide customers with better service than they've ever had. It's not just about spending money. You have to spend it smartly so that you can actually take costs out. You can see that while we've been actually investing every year more capital in the business, we've actually been able to take out operating expenses along the way.
It's across a variety of areas of the business, but nothing has been more substantial for our customers' pocketbooks than our ability to take cost of fuel out of the business. This really goes back almost 20 years ago when the company looked at our generation fleet and said, "We need to really do better. What can we do better from both a cost perspective and ultimately an emissions perspective?" You see the pie chart on the left in 2001, and you see we had a huge component of our business that was fueled by oil. In fact, in 2001, we burned more oil than any utility in the U.S. to generate electricity. 41 million barrels is what we purchased and burned in 2001.
Company made decision to start a modernization of its fleet, changing out technology, which is really 1950s technology, most of the plants built in the early '60s and mid-'60s, and switching from oil to natural gas. This wasn't required. It wasn't mandated by the commission or by legislators. In fact, frankly, it was fought along the way by just about everybody who said, "Don't change. Just keep doing what you're doing." We made investments, and we went from a company that burned more oil than any utility in the U.S. to a company that last year burned next to none. Matter of fact, the 200,000 barrels of diesel that we burned, we burned because we're required to burn it to prove that we can burn it in case we have to for an emergency.
We switched to natural gas, we expanded our nuclear plants, and we switched into renewables. In the process, we saved our customers $billions in fuel savings that we didn't go out and buy. Let me go back a second because I want to spend just a second on this, on the fuel savings for you to understand. This is about fuel efficiency. It's not even about the spread between oil and gas prices. This is about, in the industry, we call it heat rate. It's miles per gallon, if you want to put it in car terms. This is like taking a 1962 Cadillac, because our plants were built in the '60s, massive car, big fins, 500 cubic inch engine with a trunk that you could put all 20 people and your dining room set, go out to the picnic.
We've replaced them with very fuel efficient, modern generation. Think about a Toyota Camry or a Honda Accord. The difference in miles per gallon between the old plants and the new plants has saved our customers $10 billion in fuel that we simply didn't purchase. Remember, in Florida, fuel is a pass-through. We make no profit off fuel whatsoever. If we save a dollar, customers save a dollar. You save $10 billion, customers save $10 billion. $10 billion stayed in their pockets, $10 billion that stayed in Florida's economy. Makes a massive difference for not just the individual customers, but for the State itself. In the process, we also continue to drive down our emissions. Again, not mandated by the State of Florida. No requirement.
Clearly the right thing to do, but it also makes a huge difference, and I think it's good business, especially in a State like Florida. Look, we're a State that last year had 126 million tourists come to visit. 126 million people came to visit Florida. I suspect many of you did, and so thank you in advance. It's a huge industry for us, and most people have to spend all year saving up to be able to go take a vacation somewhere. They want to go somewhere where it's beautiful. They want to go somewhere the beaches are beautiful and the air is clear. People work their whole lives in other parts of this country, so they have a chance to retire and move somewhere where it's beautiful. Where, again, they can breathe the air, where the water is clean.
People have a choice of where they spend their money, whether they go on vacation or they retire, and they choose Florida because it is a beautiful place. Being clean is not just the right thing to do, it's really good, smart business. Because without that kind of economic drive, we wouldn't be able to grow either. Without that economic activity from tourists, retirees, we wouldn't be able to grow the way we are. This is good business along with, again, the right thing to do. Our investments have also spent a lot of time in reliability in our transmission and our distribution network. Really proud of the fact that we've been able to continue to improve on what is already the best in class in reliability. We've won several awards in the past, since 2017, of being the most reliable utility in the nation.
We're 50% more reliable than the next best utility in Florida. Just a reminder, everybody, there are 54 electric utilities in Florida, a lot of small co-ops and munis. To be fair, many of them don't report what their reliability, what their SAIDI rates are. I've always been a believer if you're not reporting your metrics, you're probably not proud of them. The investor-owned utilities have to report them, and I can tell you we are 50% better than the next closest utility in the State as well. Again, that goes to credibility in front of the regulators, in front of anybody in Tallahassee, and as well, obviously, with your customers. Now, the challenge with this, by the way, is that our customers come in every day. They turn on the lights. They walk in the room, it's already cool because the air conditioner is running.
Our bill is so low at the end of the month, they get it typically doesn't move their needle. It's lower than their cable bill. It's lower than their phone bill. It's a lot lower than their DirecTV bill. What happens? Customers never think about us. They really don't focus on us. I have to remind a lot of our employees all the time, don't expect our customers to be saying thank you because they take this for granted primarily, right? We're Americans. We expect all this just to work. They don't think about you until it doesn't work. This is where the investments that we've made, the nearly $4 billion in investments in transmission and distribution have paid off significantly. Jim talked about storm response and hurricanes. This is a picture of Hurricane Irma as she came onshore in 2017.
A category 4 storm, a storm that was the largest, actually, when you look at it from a footprint and power, storm to ever hit us in the State of Florida. It caused the largest number of outages we've ever had in our service territory. We have 5 million customers, meters. We had 4.4 million customers without power when Irma left the State. 90% of our customers. 9 million people without electricity, just for FPL. Of course, you can see this storm touched everybody in Florida. Every single one of the counties in Florida, there are 67, with the exception of three in the very west part of the Panhandle, had hurricane force winds.
The investments that we made in the previous decade, along with, frankly, the storm drills that go back to 1952, the experience that we've gathered from even responding to other storms in the past, like even coming up to Superstorm Sandy, right, we learned from each of the storms, allowed us to be able to restore power faster than ever before. 24 hours or less, we had 2.2 million customers restored. That's 5 million people back up in 24 hours or less. You can see some of the metrics here. Overall, the reduction in number of days, the amount of damage that we didn't have because we'd invested in hardening like concrete poles and steel poles and guy wires and smart grid technology made a huge difference. But one metric that I want to point out here is the economic impact.
Florida is now the third-largest State by population in America, but it's also the 17th largest economy in the world. We are larger than Saudi Arabia, as an example. Mexico is the next largest economy compared to Florida. We crossed the $1 trillion mark for GDP last year. We cover over half the State of Florida. So every day that we're out and not able to serve our service territory, it's over $1 billion of economic impact. Just shaving three days off a storm, as an example, is effectively a simple payback on the amount of money that we put in over the last decade into the state. It has a huge impact for customers on a lot of levels, and it clearly pays off to make these kind of investments. It all goes to customer satisfaction.
Again, I talked about how, in fact, part of our problem is the fact that customers are generally pretty satisfied. We actually have metrics that show us as having some of the highest customer satisfaction, not just in Florida, but the country, and award-winning customer service. You have to be able to find ways to be able to touch your customers in the way that they want to be communicated with. We spend a lot of time on trying to find ways to make sure that our customers have the interaction with us when they need it. We're not perfect. Lights go out, things happen. We have to be able to communicate with our customers, and we've created new apps, portals on our websites.
A lot of customers want to communicate through Facebook and Twitter, and we spend a lot of time trying to make sure that we have that customer interaction, so we drive, again, that high customer satisfaction. You can see the results speak for themselves. Very low, significant reduction in customer complaints, and a response time that continues to improve. We measure it in seconds, not minutes. Don't you wish you had that when you called Comcast for your cable? I know I did. I spent 22 minutes. I clocked it, actually, the other day. Let me talk a little bit about Florida. We're very fortunate. We serve a state that continues to be hitting on all cylinders. Unemployment continues to decline. Consumer sentiment continues to rise. You can see it in the number of housing permits as well as housing starts.
Pulling a permit is one thing, actually turning dirt is another. We've seen consistent growth across both those metrics. The state is blessed with a very diverse economy now. This was an economy that turned largely, in the past, on tourism, agriculture, primarily, and construction. We're now an economy that has a much broader and diverse base. Second-largest concentration of aerospace companies in America, as an example. A huge simulation, $8 billion simulation industry, that works between NASA, basically, and over to Tampa. Does a lot of work with our military. We've got a huge biomedical research industry as well, and the state has really diversified where the opportunities are for folks to come and to locate their businesses, grow their businesses, and to move. You can see people are coming. On average, Florida is adding 1,000 people a day. Every day.
1,000 people a day are coming to the state. You can see from the map where they're moving from, including this part of the country. Why? Well, again, I think Florida's actually done a pretty good job of creating an environment that is very warm and receptive, pardon the pun on the warm, to folks who want to come in and grow, start a business. We have a lot of opportunities. Great university system, diverse workforce, folks who actually speak other languages, native language from across the globe. A great center for Latin America. We're also a great state from a regulatory standpoint. Stable, predictable, relatively easy to permit new construction, and a great tax environment. No state income tax, relatively low property taxes. It's, frankly, only getting better when you compare it to other states. Florida just passed. We just finished our legislative session.
Florida just passed its state budget, $91 billion. Remember, we're the third-largest state in the country with a population of 21 million people. Just passed the state of New York a couple of years ago from population. Let's, for argument's sake, say that New York is the same size from a population standpoint. Geographically, Florida is actually a little bit bigger. Let's, for argument's sake, say it's the same size. It's relevant because of the number of ports, roads, the infrastructure a state has to spend money on. Florida's budget was $91 billion. Anybody know what New York's budget was this year? $176 billion. $176 billion to serve actually fewer people on a smaller state geographically. I guess you could ask yourself, are you getting twice as good a service? Because you're paying twice as much.
Part of the problem where you have states with high taxes is that people who have the choice to leave do. People who have the opportunity to relocate their businesses to a lower tax environment, they do. Which, of course, reduces the amount of revenue coming into the state, which puts pressure on the budget, which you either have to cut expenses or you have to raise taxes. New York's budget went up 4%. Doesn't sound like it was a reduction. It's an increase in the budget, which means taxes are going up. It's just math. If that continues in Chicago, in Connecticut, in Massachusetts, in California, great. That just helps us. That's why I think 1,000 people a day is going to only continue and actually increase, and it's going to help us on our growth. You can see this on our growth.
They added about 1% a year, a little over 1% a year on new customer accounts. Technology, energy efficiency, frankly, transparency, people having the opportunity to see how they use their electricity puts downward pressure on sales because people have the ability to actually be a little smarter about how they use their electricity, or they go onto their app and they turn the thermostat down when they forgot to do it, when they leave the house. They go to their ecobee or their Nest when they get to the office, and they remember to turn it down, or it does it automatically. That puts downward. Net net, we're still growing at about a half a percent. Not many electric utilities in the country have growth at all.
We're very blessed to have growth on a net basis, even when you bring in energy efficiency to the mix. Of course, smart capital deployment is very important, so is driving the cost out. Jim talked about this. He showed this to you. I love this slide. I love seeing exactly how we benchmark against every other utility in the United States with 100,000 customers or more. You can see where we were in 2016. That's the very top one up here. You can see where we were in 2017. To Jim's point about culture, we're not satisfied, and we're not done. We got better in 2018, and we're trending in 2019 to be even better. Besides the fact that it gives me the opportunity to say that we're best in class, what does this really translate to? Why is this important for customers?
Simple. If we were average up there on the blue line, look, I could probably go to Tallahassee every few years when we have a rate case, I could go on the stand under oath and say, "We're doing a good job. We're average. We're right in the middle of the pack." Our customers would pay $2 billion more a year in O&M. We would spend $2 billion more than what we spend. We don't spend $2 billion total. We'd spend $2 billion more if we were average. That's a 20% difference for our customer's bill. Average customer pays a little less than $100 a month. That's $20 a month in after-tax dollars that are staying in customers' pockets every month.
Again, very important from a standpoint of credibility, also important from a standpoint of the state's economy because that's billions of dollars that stays in customers' pockets and gets reinvested back into Florida and helps the whole place grow. It's about culture. This isn't just about one or two things you do, you take the cost out, you move on, you think about something else. This chart shows you this has been a march. It is not a sprint. Year in, year out, focus on this and really driving productivity so we can get the costs out on a sustainable basis.
That's why I'm so bullish about our opportunity to continue to invest in the business and take costs out and take that money, those savings, and redeploy it in smart capital, which will help us grow and provide overall a much better experience for the customer. We're doing it in all kind of ways. Because, look, we don't have a special patent, a special widget that no one else does. We don't have some kind of magic dust that only we have access to. We take technology that everybody else does, has access to, and we figure out ways to deploy it. Many times, the technology was actually developed for another industry, how do we adapt it? Yes, we do sometimes, and we have a number of algorithms and processes that we have patented. We deploy it, and we get costs out of the business.
Our focus now is, again, Jim talked about this, big data, analytics, and deploying technologies like AI, like virtual reality, in ways that will actually help us drive costs out and satisfaction for customers up. I'm going to show you a video rather than try to explain all this, which will give you a better understanding of things that we're actually doing today, give you just a little bit of an insight of where we're going to be tomorrow.
Florida Power & Light is not your average utility. We're actually a technology company that delivers clean, reliable, and affordable power at prices well below the national average to more than 10 million people. Our smart grid uses advanced technology to predict and prevent outages and restore power faster when outages do occur, often without ever having to roll a truck. It all started with the deployment of millions of smart meters and thousands of smart sensors. Each day, we collect nearly 1 billion data points from these devices and use predictive analytics and algorithms we developed to identify potential problems, so we can fix them before our customers are interrupted or crews are dispatched. More than 110,000 intelligent devices are installed on our grid, like our new automated transformer switch, the first of its kind in the world.
These devices can automatically redirect power, self-heal, and eliminate or minimize customers impacted all in milliseconds, resulting in 5.5 million outages avoided to date. Drones also work to keep our grid smart. Equipped with HD multi-spectral and thermal imaging to constantly assess the health of the grid, our drones use artificial intelligence with machine learning and image recognition software we developed to spot faulty equipment and prevent outages, and geospatial data so flights are fully autonomous. On the ground, automated rovers in our substations inspect the facilities night and day and report back in real time, remotely identifying any changes or potential issues with equipment.
Our state-of-the-art natural gas facilities are the cleanest and most fuel-efficient in the world, and we're using a proprietary design platform and high-performance cloud computing to quickly and optimally design, build, and integrate new solar and battery facilities, including the world's largest battery site, covering over 40 acres, that will replace an old fossil plant and provide over 400 megawatts of clean energy to our customers during peak periods. Innovation and technology are at the heart of what we do every day. We'll never stop looking around the corner and working to improve how we serve our customers today, next year, and for the next generation, all while keeping reliability high, costs down, and bills low.
It's really an exciting time of different areas that we're looking at and how do we drive costs out of the business. I will tell you, I don't even think of us as a utility. I think of us as a technology company that actually delivers power. That's the culture that we're really instilling throughout the entire organization, which allow us then to continuously look at how do we continue to grow the business smartly so our customers can benefit. I'm very bullish about the opportunities on our capital program going forward. We have a number, as you can see from this, and I'm not going to go through all of these. I'm going to go into some detail on some slides going forward.
Everywhere from new generation on natural gas, the solar program that Jim talked about, some new tariffs that we've come up with on lighting and backup generation, battery storage, which we are just in the beginning of the first inning on the opportunities on battery storage to make a difference. Of course, continuous investments in smart grid technology, transmission, distribution, and undergrounding. Jim talked a little bit about this on the quietly going about our engineering construction group on being able to execute on big projects. I want to take just a minute to give you an example of one of those. This is Plant Okeechobee. This is a 1,776-megawatt plant that we just brought into operation just north of Lake Okeechobee. Natural gas-fired, very efficient, super clean technology that our team brought in actually early and under budget. Guess what?
That's not an exception. The last 25 major capital projects we've done have come in early or on time and under budget, on average, about 7%. 7% is real money. This is over $1 billion for this plant. As we've seen in other parts of the country, there's no guarantee when you start a construction project that it's going to go well. There's a lot of challenges. A lot of folks have heard this before. People say, "Yeah, you guys put a lot of wind turbines in. They're not that complicated." Wrong. There are a lot of things that can go wrong even building a wind farm. You have to really tightly manage it. On something complicated like this, there are a lot of things that can go wrong and you have challenges on. Yet, project after project after project, the team has executed.
Again, it goes to culture, it goes to never being satisfied and always challenging yourself of what you could do better. The plant on the right, that's a real plant that was constructed at the same time in the same region. Again, everybody can get access to the same technology, by the way, that we can, execution makes a huge difference. Look at the difference in time it took to build the other plant and the cost to build the other plant, and ultimately, the performance of the other plant from a heat rate perspective. Again, remember, heat rate, miles per gallon, that's every day. For the rest of that plant's life, it is going to be burning more fuel than the one we built every day.
Every day, their customers are going to get charged more money for the exact same product at the end of the day, an electron. That's why the focus on execution and the technology is so critical. That's why we're building Dania Beach right now. The next plant that goes online, not far from the Fort Lauderdale International Airport. If you're flying in over the water, look out the right side of the airplane, you'll see this project under construction for just a second, because then you'll be on the ground, then you won't see it. Super clean, very efficient, great emissions profile on this plant as well, and will deliver reliable power in a low pocket that is growing and has challenges from a transmission perspective. Really important to be able to get this done. We have permission. We've gotten all the approvals.
It's under construction. I have every expectation that we're going to get it done on time and hopefully a little bit under budget. Jim talked about this. I want to spend a few moments on our 30 by 30 plan. It's because it's not all about just switching from oil to gas. We have gone into solar in a very big way. I will take a little risk here and I will actually correct my boss. Our first solar project was actually in 1984, tiny in Miami. FPL did it. All right. It was experimental because we wanted to learn about the technology, we wanted to understand it. What we found out in 1984 was it was very interesting, but it was wickedly expensive and didn't really make a lot of sense.
The world has changed a lot. The price of solar panels has come down materially, as has inverters and the cost to construct. At FPL, we learn from NEERs, from resources, experiences. We also get the benefit of a corporate-wide purchasing program. We get the prices down. We were able to actually go out and announce that we're going to do 10 gigawatts of solar between now and 2030. It's cost-effective for customers. It makes a lot of sense for customers. We've actually been working on this for several years. We just didn't want to say anything because frankly, this takes a fair amount of land. We wanted to be able to go out and secure the land before folks understood what we were going to be doing.
Guess what happens when people know you're going to go out and tie up hundreds of sites in advance? The price of land goes up. We were able to actually get most of the land secured through options or purchases before we made this announcement. $10 billion investment between now and 2030. Very excited about the opportunities and the benefits that customers will see and the state will see. We've also launched a new program called SolarTogether. This is a program that gives customers who otherwise wouldn't be able to participate, to participate on a voluntary basis if they choose to. Why can't customers participate and put solar on their roof? A lot of our customers live in condos or apartments. They don't own the roof. They live in a structure that won't support solar panels, right? Like a manufactured home.
They still want to participate. This is a program that gives them an opportunity to do this. Same thing with commercial and industrial customers. Our C&I customers, many of them want to be able to participate in solar. They can't put it on their roofs. Again, many of them don't own the roofs. They're in a mall. Many of them have a roof that doesn't work because it's got a lot of equipment already on it. We've gone out to customers to gauge their interest. Just C&I customers alone, in the 60-day period of time, materially oversubscribed on the interest of this program because it's a great opportunity to participate and get a simple payback in only a few years. About six years, you get a simple payback.
You pay a little more upfront, you get credits on your bills that will last for the entire life of the projects. Net-net, your customers end up saving money and being able to participate in solar. Another great opportunity, going to be in front of the commission with this. Huge support across all of our customer base that we've seen so far to move forward on this, I'm excited about it. This will allow us to, again, deploy large-scale solar around the state, but bring it down to the individual customer from a benefit standpoint. Battery storage. I said earlier, we're at just the beginning stages. A great opportunity for us to leverage the expertise the company has for what NEER has learned and what we've learned.
To remind you, in 2016, in our rate case, we actually secured a 50-megawatt battery pilot program. We've learned a lot throughout that process, now we're going to be deploying the world's largest battery facility at a plant called Manatee. This was one of the plants I was talking about that was actually built in the very early 1970s. Oil-fired, switched to natural gas. We're going to tear it down. We're going to replace it with 40 acres of batteries. 409-megawatt, two-hour battery, largest facility by a factor of four in the world. Setting the stage for a whole new part of the industry and the ability to serve our customers reliably, but also provide them real economic savings. Continued investment in transition and distribution, a lot going on in this space. Smart grid technology continues to expand. We continue to put more devices on.
We continue to look for ways to strengthen the grid. As I told you before, particularly now with the focus we had, unfortunately, last year in the Panhandle, we had Hurricane Michael. We had Hurricane Irma the year before that. We had Hurricane Hermine the year before that. What you see is people recognize that these are good investments, not just for hurricanes, but every single day. You get a thunderstorm that comes through, 60-mile-an-hour winds, our system hardly impacted because again, these investments pay off every single day. There's a lot of opportunity to deploy capital here. The legislature even went so far as to say, "We really want to make sure that the entire industry focuses on this," passed legislation this year, which directs the Public Service Commission to actually put together a clause recovery mechanism for utilities on storm hardening and undergrounding.
We already do storm hardening, we already do some undergrounding, this is going to give us an opportunity to even expand that and do it on a programmatic basis over the course of decades to be able to go now into laterals, the lines that are typically in people's backyards or right in front of their homes, and start to underground those. Again, this makes a huge difference, not just from a capital deployment standpoint, but also on how we run the business. By smartly doing this, we will actually be able then to reduce the amount of money we spend to maintain the overhead lines because they'll no longer be overhead. Last year, we spent $71 million on vegetation management. That's a fancy way of saying trimming trees. When the lines are underground, you don't have to trim the trees.
We get to take that cost out of the business and redeploy it into capital. Again, tariffs that we're looking at, LED lighting, backup generation, these have been approved by the Commission. These are voluntary, but an opportunity for our customers who have said to us this is what they want. They need help being able to deploy these technologies. They are not experts. They want us to do it, and they want the ability to have a tariff to be able to pay for it. We've now put those in place, a good opportunity for several billion dollars worth of deployment across our territory. You can see some of the differences just in streets as an example, and the lighting.
Very, very positive for customers, as well as other stakeholders like law enforcement, who love this and are encouraging cities as well as customers, like in their parking lots, to switch over and put in LED lighting. Again, lots of visibility, and to be able to deploy capital across the business between now and 2022. More capital that will allow us to take more costs out and be able to continue to keep bills very low. I'm going to wrap it up with a couple of financial slides, just to give you a little more visibility in this. Of course, you know that our business really depends on smart deployment of regulatory capital growth. Capital structure ROE, you can see we're going to have continued growth, about 9% in our capital deployment across a number of different parts of the business. This is not just generation.
This is across a number of different parts of the business, and it gives it a chance to continue to grow our net income and make sure that we are financially strong. Let me take just a moment to talk also about where we stand with regards to our rate case. To remind all of you, we are in a base rate settlement agreement went into 2016. That's a four-year agreement, runs through 2020. We've talked about in the past that we're going to see if there's an opportunity to go ahead and extend beyond that period of time. We have the unilateral option to do that. Right now, based on everything that we see, and of course, this is going to turn on sales ultimately, retail sales, our ability to continue to manage costs, and our ability to execute around our capital program.
If we continue on the trend we are right now, foresee a one-year stay out on our rate case. We will actually be filing for rates in the first quarter of 2021, for new rates starting January of 2022. Again, that could change depending on what happens in sales and our capital program. Right now, I feel pretty good about a one-year stay out and being able to not go for new base rate adjustment until 2022. That's a five-year stay out that our customers have had no adjustments to their base bill.
Also allows us, during that period of time, to really focus in on the business, to drive those costs down, to find new ways to actually enhance the customer experience when they are communicating with us, to find technologies that will help us drive the CO2 emissions rate down even further, and ultimately, have the lowest bills possible for our customers. I'm really, really proud of our team, the ability of them to continue to stay focused. It's hard when you've won a bunch of awards for being best in this and best in that to keep people focused on still trying to find ways to be even better. The culture of the company is such that Jim is right, never satisfied.
I think with that kind of culture, I'm confident we'll be able to continue to be able to take costs out and provide that value proposition for our customers that's second to none. With that, I'm going to ask Marlene Santos to come up, who runs actually Gulf Power for us. Marlene, by the way, used to run customer service for Florida Power & Light for many, many years. She is one of the big reasons we have such happy customers at FPL. She also very, very tightly managed the business, managed costs, and was the perfect person to go up to Pensacola and become president of Gulf Power. Welcome, Marlene.
Thank you, Eric. Good morning. It has been about six months since NextEra Energy acquired Gulf Power. Today, as you'll see, although we are one-tenth the size of Florida Power & Light, we have big plans to transform the company. Those big plans are well underway, and they include investing in smart capital, reducing our O&M costs, reducing fuel costs, changing the culture. At the end of the day, they're going to result in a net income CAGR of 16% a year between 2018 and 2021. Because we are very committed to providing a great value proposition for our customers, you're going to see that we're going to do that while also reducing our customer bills. We have a target to reduce customer bills by 20% in real terms by the mid-2020s.
The slide that you see up here actually has pictures of day one, which was a very exciting day for our company and a big milestone. Let me give you an overview of Gulf Power. We are located in Northwest Florida. It really adds a great footprint to our regulated operations in Florida. Northwest Florida, 460,000 customers, mostly residential, but the C&I customer segment is very interesting because it's got a big presence of military customers. This area is known as the birthplace for naval aviation, that has brought on lots of military presence, STEM skill sets. I'll talk about that in a little bit about how that gives us opportunities for growth. We have about $5.2 billion in assets. My presentation is all around opportunities. This slide shows four opportunities, and the next slide that I'll show will show a fifth opportunity.
The first opportunity is a graph that you've already seen a few times today, but it shows our dollars per megawatt hour compared to others. Eric has the privilege of showing you FPL, which is all the way at the bottom at $12 or so. I have the privilege of showing you the Gulf Power one, which is at 29, which creates huge opportunity for us to drive that cost down using best practices that we know from Florida Power & Light. You also see service reliability, SAIDI, our SAIDI at Gulf Power is about 1.8 times that of Florida Power & Light. Big opportunity for improvement. We're actually also above the Florida average, big opportunity there. When it comes to generation mix, you can see that three-quarters of our generation is from coal and purchased power, which are very costly generation mix sources.
Our CO2 emissions rate were 1.7 times the industry average. Big opportunity there. Lastly, here's another great opportunity, and this is the opportunity to invest smart capital. You can see in the regulatory capital employed chart that Gulf Power has grown its regulatory capital employed at roughly half the rate of FPL over the past 10 years. What has happened to the bills as a result of that is the chart next to it. You can see that Gulf Power's bills have gone up 30% during those 10 years. FPL's bills have actually come down 6% during that same time period. If you take a look at the reasons for those shifts, you can see that for Gulf Power, just about everything, all the bars have gone up, but one that is very notably increased is the yellow one, which is environmental cost.
For FPL, you can see a big reduction in fuel, which is the green bar. To me, this is a testament of the NextEra Energy playbook working beautifully for our customers, and this is what you will see us doing at Gulf Power. Very similar to what Eric showed as far as customer growth. We're also expecting about 1.2% growth in customers, seeing the same type of decline in usage as Florida Power & Light. At the end of the day, we're expecting about half a percent increase in retail sales. Let me take you through that NextEra Energy playbook that we are executing.
Before we acquired Gulf Power, we already had some ideas of some of the things that we wanted to do, we were very quickly able to get into the company and put together our roadmap with our strategic focuses, which are the four that I'm showing to you here today. I'll go through each one. The first one, clearly investing in our people. You've heard about culture, you've heard about the importance of culture from Jim and from Eric. We're doing a lot to invest in that culture. First and foremost is safety. The safety of our employees is the most important thing. As you can see, we have a long ways to go. If you look at our OSHA rate, we are a zero today culture, one incident is one too many.
We're very proud of the fact that we have been able to reduce the OSHA rate already year-to-date by 50%. We are very focused on culture and building into the Gulf Power employees that same culture of excellence, of accountability that Florida Power & Light and NextEra so strongly enjoy. We have started Six Sigma training. We started actually a culture assessment. We're doing a lot of work around accountability, innovation, all those things that we know are needed for our employees to thrive and be successful into the future. We're blessed with a wonderful group of employees, a very talented group, we are spending a lot of time and effort to develop them, to grow them so that they could be successful. We've set very big goals for ourselves, and we're very committed to delivering them.
That's part of that culture of accountability. One of the big goals that we have set is sort of as Jim mentioned, we have to do two things at the same time. We're going to be best in class in all of our performance indicators, and at the same time, we're going to drive down costs. We're not going to do one or the other. We're going to do them both. Three weeks into the acquisition, again, I'm looking at Jim, and he's smirking at me because it was against my recommendation, we launched Project Accelerate just three weeks in, and the team did amazing. I'm so proud of the Gulf Power employees. We came up with over 500 ideas. We're actually executing on over 200 ideas and have very detailed plans to deliver on over those 200 ideas.
You can see here the value that we created so quickly in the organization. $100 million worth of ideas. I've listed some of them here. At the end of the day, a lot of ideas around centralization, consolidation, IT, streamlining the operation, bringing in the NextEra best practices into Gulf Power. Focus on the customer. Clearly, that's one of our big areas. We started measuring customer value, and we're very happy to see that we are very grateful that we have a very good customer brand and customer satisfaction at Gulf Power. We're starting off at a good point, but we're driving those key metrics that we know are important to our customers. We've already, in just this very short time, have already started getting very good results. You can see speed of answer, PSC complaints, just big improvements in those areas.
The other thing that we're doing is that by the end of this year, we will be deploying new customer systems, and we're excited about the fact that they will enable us to provide a better customer experience. Lastly, you've heard a lot about investing in smart capital. And by smart capital, we mean capital that creates long-term benefits for our customers. In generation, that's going to be investing in capital that reduces fuel, reduces O&M, improves emissions. In T&D, it's around improving reliability and storm resiliency. I'm going to talk to you more about those capital investments. Here's a chart similar to the one that Eric showed of all the capital initiatives that we have planned between now and 2022.
When you look at this, you see a lot of opportunities for a little company like ours, lots of opportunities. If you look at the status column, just about everything is underway. It's amazing the speed at which we have been able to start all of these projects. I can tell you that the reason for that is because of what I'll call the mothership, right? I mean, the amazing support that we at Gulf Power are getting from our NextEra family. Everything is pretty much underway, Very excited about all of these projects. One of the very strategic projects is what we're calling the North Florida Resiliency Connection. This is a 176-mile transmission line that connects from FPL.
You can see FPL, that's in the sort of northwest point of FPL and takes it all the way to the most eastern point of Gulf Power. Transmission line connecting the two systems. The big value of that is that we're going to be able to bring low-cost power from Florida Power & Light over to Gulf Power customers. You can see $400 million capital investment, huge benefits of savings for our customers. We're targeting an in-service date in 2021. Another strategic investment is the conversion of our Plant Crist from coal to gas. You saw that big percentage of coal in our generation mix, this is a big winner for our customers. You can see that we're not only going to convert the plant, We're also building a gas lateral to bring the gas into the plant. About $175 million investment.
We're going to reduce CO2 emissions by 40% just from this investment. Target in-service date, mid-2020. Also at Plant Crist, we will be adding combustion turbines, 950 megawatts of base load capacity, a $500 million investment. The beauty of this investment is that it's going to allow us to essentially eliminate the capacity cost that our customers are paying today, You'll see that in the bills coming down in a little bit when I show you. Moving on to a different plant, Plant Smith. This project is almost done. It'll be done in the next week or so. We're actually improving the efficiency of a combustion turbine at Plant Smith, increasing 100 megawatts of base load, $50 million capital investment with nice savings for our customers also. We're bringing solar to Northwest Florida.
You heard from Eric the amazing work that we are doing around solar. We are using that FPL development and NextEra knowledge around solar. We're leveraging all of that to bring solar also to Northwest Florida. We're developing three projects, 225 megawatts across Northwest Florida, spending about $300 million. We'll be reducing customer bills. Also nice savings for that, We're continuing to look for more opportunities and more projects for solar. All those generation investments, this is what they do as far as the fuel cost. 50% reduction in fuel cost, 100% reduction in the capacity clause. I mean, these are true benefits for our customers. T&D is the other area that has lots of opportunities. Here I'm laying out for you more or less the investments that we're expecting to make.
When it comes to the transmission and distribution grid, we have a huge opportunity around smart grid devices, pretty much upgrading the whole T&D structure to the levels that you saw in the video that Eric showed you. There's lots to do still there. To give you some statistics, 75% of our distribution lines are still overhead. We have a lot to do in that area. When it comes to storm hardening, you heard about the legislation. We're thinking about adding $100 million-$200 million of incremental capital to do that storm hardening at Gulf. We have lots of opportunity in transmission, our wood poles. We currently have about 60% of our transmission poles are wood. For FPL, that statistic is 10%. Lots of upgrading to do to get the infrastructure to be hardened and resilient.
We just had Hurricane Michael hit the Panhandle. That community knows the importance of these investments. We're very excited about doing the right things for the community. When you add all those capital expenditures up, this is what you get, $2.9 billion-$3.3 billion of investment over this time period. You can see from the red dashed line that it's a big increase from historical levels. What does this all do to our financials? You've seen some of these charts already, but reduction in O&M cost of 50%, regulatory capital employed CAGR of 14%, which at the end of the day rolls up to a net income CAGR of 16% between 2018 through 2021. It's not just about financials. We're focused also on our employees, our customers, and our communities.
OSHA rate reduced by 50%, service reliability increased 20%, CO2 emissions reduced 40%. I told you that we are committed to providing that strong customer value proposition. This is what we expect will happen to customer bills. We are targeting a 20% reduction in real terms by the mid 2020s. When you look at these financial outcomes, a couple of things that you should also note. Eric mentioned about the rate case for FPL and the fact that the current best estimate for a rate case for FPL timing is filing in mid 2021 for rates to be effective in 2022. Like FPL, for Gulf Power, a lot of things go into deciding when to file a rate case. It'll be dependent upon many factors.
Our best current estimate is the same as FPL, which would be to file a rate review in the first quarter or so of 2021 for rates to be effective in 2022. In addition to that, we are in the midst of reviewing the possibility and the benefits, the impacts of merging or combining our two Florida utilities into one larger utility. No decision has been made on this, but we're in the midst, like I said, of reviewing it and understanding the financial impacts, the operational impacts. As all of you know, one of the big benefits of being able to do this, because it takes a lot of time to file a rate case, would be to be able to file one rate case for one company. That's in the midst of being reviewed. In summary, we've got big transformational plans at Gulf Power.
We're going to increase net income by 16% per year, and we're going to provide an excellent value proposition for our customers by reducing their rates in the long term in real terms. Thank you so much for your attention, and it's now time for a break. 10-minute break. Thank you.
I would ask folks to take their seats. Plenty of time for discussion afterwards. It's the good song. Give folks maybe 15, 20 seconds if more are here. Okay. Welcome back everyone. Again, the agenda for the rest of the day, you'll hear a little bit from me, we'll turn it over to Mark on NEP, and then Rebecca will pull it all together and wrap up, and then we'll go to Q&A. I want to start with something that Jim said. He said he'd been here 18 years, and in that 18-year period of time, he's never seen this company better positioned. I think you've heard from Eric and Marlene, and the growth is really only getting started at FPL and at Gulf. Terrific prospects over the next four years.
It's really much of the same story for Energy Resources in terms of the opportunity set that it has in front of it. If you reflect back on Energy Resources, just an amazing growth story over time. Going back to that 2001 timeframe that Jim mentioned where Lew had made the decision to get into clean energy. One of the things he did is he brought Jim over to the business in 2002, and you saw the growth of that business exponentially climb. We have been able to turn Energy Resources into a Fortune 500 company from scratch. That's been a lot of blood, sweat, and tears for many people in this room. Terrific execution on the development side led by Mike O'Sullivan as well. Our goal for Energy Resources is straightforward.
Our goal is to continue to grow North America's largest, most profitable, competitive clean energy company. How are we going to do that? The first way we're going to do that is by leveraging our competitive advantages or our playbook. The second thing we're going to do is capitalize on what is the best renewables environment in our history. I'm going to spend some time taking you through that. The third piece is we're going to disrupt the rest of the industry. If you put all those things together, that's been the right strategy at the right time, that's worked very well for Energy Resources, and we are really well-positioned. If you take one thing away from my comments over the next 40 or so minutes, we are really well-positioned over the next four years.
Since the last earnings call, just in the last 60 days, we've already added 1,500 megawatts to our backlog. We already have almost a four gigawatt head start to our post-2020 development. We are really well-positioned for the future. Let me start by talking a little bit about the Energy Resources value proposition. As you know, Energy Resources is a company that's built on a long-term contracted model. It's centered around renewables. You can see it from the chart here, roughly 17.5 gigawatts in operation. If you add that 11 gigawatts of backlog, we're right around 29 gigawatts today of renewables under operation. Those 29 gigawatts of opportunities that we have on the renewable side are really well diversified. When you look at the map, lots of dots, hard to see, but we're not focused on any one part of the country.
We're in over 36 states. From a resource variability standpoint, terrific diversification across the entire portfolio. You can see from a renewable standpoint, when you look at the generation mix, right around 75%. That's a number that you should expect to continue to go up over time. On top of that business, and as part of the long-term contracted model, which is really a perfect complement to our regulated business, if you think about it. A regulated business together with the long-term contracted model we have in Energy Resources, about 8 Bcf on the gas side. We have a nuclear business that is about 70% contracted. We have a competitive transmission business that's approaching $3 billion in CapEx by the end of 2022, rate regulated, long-term contracted. Perfect complements also to the renewable platform that we've been able to deliver.
Let's talk first a little bit about what the expectations were back in 2017. What's the report card? How did we do? Well, green checks typically mean you did pretty well. Really happy with the results that we were able to demonstrate. When you look on the renewable side, the midpoint was right around 13.3 gigawatts. A little bit short of that at 12.3, but we're still not done on 2019 and 2020 development. We probably have, realistically, maybe 200, 300 megawatts more of potential opportunity through the 2020 time period. Why is that? Turbines are in short supply, E&C contractors are in short supply. A lot of constraints.
Because of that, we're all of a sudden getting calls from folks that signed up contracts with smaller competitors that have backed out and now are looking for help to see if there's somebody that could step in before the end of 2020. We're always uniquely positioned to do that because of the leverage that we have on our supply chain, but really well-positioned for 2019 and 2020. It's a perfect fit with the financial expectations you're going to see today. On the backlog, like I said, a four-gigawatt headstart to post-2020. 40% of our solar origination in 2018 was enabled by battery storage, a business that we said in 2017 would be toe in the water. We probably underestimated what a big impact it would have on the solar origination business that we have seen over the last couple of years.
You see that in that 40% number. Really happy with the capital recycling we've been able to achieve largely through NEP, also with the final divestment of much of our merchant gas portfolio, really making the company a long-term contracted business. Then on the natural gas pipeline side on MVP, still in progress. I'm going to take you through some more details later. We see a path forward there and are continuing to construct that project, which should be about 90% complete by the end of this year. At its heart, again, a long-term contracted model built on renewables. You can see that our merchant generation has declined pretty consistently over time. We really, for all intents and purposes, aren't in the merchant generation business anymore except for Seabrook, and I'll talk a little bit about that later on.
You can see all the growth in renewables, that 17.5 gigawatts plus the 11-gigawatt pipeline, putting us close to 30 gigawatts today, if you believe we'll build out what's in the backlog, which we have a very good track record of doing it. How are we able to achieve that type of success? It really starts with our development skills, which I view as the moat, so to speak, the thing that separates us from the rest of the pack. An easy analogy would be if you drop one of our developers in, pick your state anywhere in the country, and they have to go and get a win, which means originating a new solar or PPA contract. They really start at somewhat of an unfair advantage just because, number 1, we've been in this business for 20 years.
We have a lot of experience, a lot of know-how, we own a lot of assets in every single state that we build renewables in. We already are starting from a point of strength in that we have amassed a pipeline, which are what we think are the best sites in that state to build more wind, more solar, more battery storage. When we're responding to an RFP from a customer, a lot of the smaller developers we might compete against, they might put one project in. They might put two projects in.
We're able to bid three projects, four projects, those projects, we think, are probably the best projects because we have intentionally and strategically selected those sites based on all the information we have from our 20 years of experience in that state and the data that comes back from the assets that we operate. You combine that with not only having a great site, but all the things we can do on the development side. Outstanding relationships with customers, the ability to sell and market integrated products, wind and solar and battery storage together, the brand recognition that we have. Customers signing up because they know when we give them a price, we're going to deliver, we're going to show up with the megawatts. They're not going to have to go back out and rebid those projects. Most importantly, our people. We have outstanding people.
Jim talked a lot about the culture with outstanding loyalty. We don't lose people. Our people are very engaged in what it is that we're trying to accomplish. We have a massive construction company platform that we're able to leverage. When we're in there competing against other folks in any state that you might pick, we're able to leverage that scale, that skill, that scope. If we run into regulatory problems, we have, I think, bar none, the best regulatory team in the business. It starts with Joe Kelleher, the former chairman of the FERC back under the Bush administration. A lot of tools that we're able to utilize, technology and innovation being one of those as well. That I'll talk a little bit more about in a few minutes. Right strategy at the right time. Definitely the right strategy at the right time.
You can see it here in the cash and earnings growth, which has been in the mid to upper teens, both from an adjusted EBITDA and an adjusted earnings perspective. That's the value proposition. Let's talk a little bit about how we've been able to leverage our competitive advantages or the playbook and how we're going to be able to leverage that going forward to be able to create significant opportunities. A lot of bubbles on the chart here, I want to focus you in on the one in the middle, the yellow one. That's the opportunity set that we have in this industry through 2022. 80 gigawatts of potential opportunities through 2022. The blue circles on the outside, those are the ones that are driving that 80 gigawatts. Battery storage, nuclear to coal switching. I'm going to talk a lot about economics.
Although we don't need it, state RPS, a lot of states increasing their renewable portfolio standards. Solar and storage under existing wind. Let me talk about that just very briefly. There's a new order that came out from FERC, it's called FERC 845. What it says is, if you have an existing site, you have an existing wind site somewhere in the Midwest, and you have surplus capacity under your long-term generation interconnection agreement, guess what? You don't have to go through the whole queue process that normal folks have to do. Expedited queue process and no transmission upgrades associated with that development opportunity. Think about the possibilities, right? We talked a lot about repowering last time.
Think about the possibilities if you have the largest renewables portfolio in the world to take advantage of this new rule where we can go to our existing wind sites, start looking at putting storage together with them, putting solar under wind, and taking advantage of the fact that we have zero transmission upgrades because we already have an interconnection agreement in place. C&I demand. All we hear about from ESG demands, from investors being placed on the C&I market. That's creating a lot of demand. A lot of demand. It's not just the typical FAANG stocks that we used to hear from. Now it's the Wilshire 5000, it continues to grow as we go forward. Technology. Ton of technology improvements coming in the sector that are also driving that 80 gigawatts of demand. The question is: how do we get our fair share?
That's the green circles. That's the playbook. Those are our competitive advantages. First, we buy cheaper. We buy cheaper, we build cheaper. We build and buy cheaper because when you're spending $12 billion-$14 billion a year in CapEx, and you're the sixth-largest capital investor in the U.S., you get terrific terms and conditions and price concessions from your supply chain. We operate cheaper. Scale. I'm going to talk a lot about how we're using technology to be able to do that. Our O&M costs are lower than the many small competitors that we compete against. We finance cheaper. Paul Cutler, the whole treasury team, does an amazing job of going out globally to secure capital, and we take an approach where with our bank group, which is over 100 banks, are really driving down the borrowing cost. Identifying customer solutions.
Because we've been in this business as long as we have, every single state that we go into, we know transmission congestion. We know how gas is correlated to power. We know where the best potential sites are next to load. We are now bringing solutions to customers where we're saying, the right way to look at this is wind, solar, battery storage combined, or maybe it's one of the three. Being able to come to them with real ideas and being able to think like our customer. We have a tremendous advantage. We have Florida Power & Light and Gulf. We know how investor utilities think. We know how they model their system. Don't underestimate what a leg up that gives us against the smaller competitors that we compete against. We innovate better.
If we're able to take that playbook and apply it against that 80 gigawatt demand, we expect to be able to get our fair share. What did our fair share mean back in 2018? Our fair share in 2018 in wind meant 26% of the market, because that's how successful that playbook was for us. Don't underestimate how much leverage that gives us. 19% share in solar. Again, you can see the small bars. Those are the really small folks we compete against in wind and solar. We're the ones with scale. We're the ones investing capital. We're the ones that can drive the lowest prices for our customers. Back to the buying power. I said again, sixth-largest capital investor in the U.S. in any sector over the last 10 years. Last 3 years, we've been anywhere from fourth or fifth. Tremendous amount of scale.
We are almost always our supplier or vendor's largest customer. That means better pricing, better terms and conditions, a lot of ability to exercise that buying power. The other thing it means is, back to what I said before, there are a lot of those small guys on the chart that I showed you earlier that get in over their skis, right? They put a price in front of a customer that they're not actually able to deliver, and they string the customer along for a couple of years. All of a sudden they show up and say, "Guess what? I can't do it." We get those calls, and the call is, "Hey, do you guys have a site? Do you guys have the equipment?
Can you guys build this for us?" Because of this, trust me, the vendors and the suppliers, if they're going to make room for anyone, they're going to make room for NextEra first, that creates a lot of opportunities for us as well. O&M. We operate cheaper than anybody else in this sector. How are we able to do that? Look at wind. I'll just take wind, for example. We have taken 25% out of our O&M since 2014. Culture of continuous improvement, never settling. You know what? That's not good enough. That is not good enough. We are going back to our teams and saying, "We're not going to settle for that. Go totally reimagine the way you approach O&M." We expect another 20% coming out of the O&M on the wind side, 30% on solar.
If you think about wind is really becoming technology-driven. Instead of just calling up the site, "Hey, what are you doing today? What's the work order on our 10,000 turbines?" We don't approach it that way. We use all the data points that we get from our wind fleet, which is billions of pieces of information a day. We take all the PPA revenues that we have, the financing conditions, and debt service coverage ratios that we have, and we rank our sites, and we rank our turbines, and we say, "Which ones are the most important to fix first, and which ones are the most important to fix last?" It's a giant logistics exercise. The crane goes to the one that maximizes profitability. Guess what? It's all done electronically using big data, using AI, using machine learning.
We put iPads in the hands of our people in the field, and they have real-time work plans, and they maximize the utilization of the resources and the parts that it takes to get that work done. It's going to drive an enormous amount of cost reductions across the business. In solar, we are moving towards unmanned operations at our solar projects. Really excited about where we are today, but not settling for it, not being complacent because we can be a lot better, and looking forward to that as we go forward. It doesn't just start with O&M and the people orientation and having the right skills and talent, but it's also technology. You've heard Jim talk a little bit about it. You've heard Eric talk about many of the things that they're doing at FPL. Think about our company.
We have, again, the largest renewable fleet in the country. That means we get more data and information than anybody in this industry. Again, billions of pieces of data coming in every single day. We're able to transfer that data over to NextEra Analytics. I've talked over the years to most of you in the room about who NextEra Analytics is. We have amazing capability at NextEra Analytics. This is a group of PhD mathematicians, data scientists, data engineers that are extremely innovative. It started back in 2005 with them doing just our wind resource assessment and our solar resource assessment, and it's expanded into helping our development team, helping our operational team, and they are developing tools that are becoming competitive weapons for our business. You can see some examples there.
Rather than have me take you through them, I'm going to show you a short video.
At NextEra Energy Resources, we generate more than clean energy. We develop solutions to meet America's energy needs. Our goal is to provide cost-competitive, reliable, clean energy options. We deliver by leveraging big data, machine learning, and artificial intelligence like no other energy company in the world. We collect billions of data points every day and use that data to make smart decisions that optimize project development, maximize revenues, and reduce operational costs. In renewable development, design unlocks value. A typical wind project has trillions of possible designs, and traditional computing capabilities require several weeks to evaluate just a few of them. We developed an intelligent design optimization tool to evaluate millions of possibilities in just a few days. Our tool uses state-of-the-art cloud computing and advanced analytics to process enormous amounts of proprietary data on topography, weather, and equipment capabilities.
Now, we can deliver better solutions for customers and shareholders and expand our competitive advantage in renewable development. Combining big data with digital automation, we also transformed the way we work. With digital work plans and the ability to view real-time performance of our fleet, we leverage digital tools to streamline, simplify, and automate labor-intensive processes. Rather than having more than 120 site managers develop individual work plans for their projects, we leverage our digital capabilities to optimize work planning across our portfolio. Every part of our company is infused with technology, even in the air. We use drones to detect, predict, and prevent issues with our wind turbines. Using artificial intelligence to analyze the images, an autonomous system can make repair decisions that reduce cost and decrease turbine downtime to maximize revenue.
At our company, success is driven by our people who leverage technology to deliver development expertise, financial strength, and operational excellence, now and for the NextEra.
Amazing what we've been able to accomplish in a short period of time. I always ask a question, which is what if? What if we could do this. What if we could do that? What if we could take all these tools, our ability to do a site layout in a couple of days on a wind project or a solar project, and be able to look across the country at where the opportunities are and where the disconnects are in terms of the generation fleet, and be able to proactively go to customers to identify solutions. Those are the kinds of things that will differentiate and revolutionize the development business for energy resources. You take the equipment that we have today, whether it's a battery, whether it's solar panels, whether it's a wind project, these are really sophisticated pieces of technology. Take a wind project, for example.
We have the autonomous predictive adjustments for wind turbines. Wind turbines are basically computers with blades on top of them. It's not just a matter of having somebody back in the main office making twice-a-day adjustments to where our wind turbine is facing and whether the pitch is correct to maximize the revenue off that turbine. Today, it's about using AI and a computer algorithm where we're making minute-by-minute changes to that turbine. It's always positioned into the wind, pitched properly to maximize revenue off that turbine. This is a technology business. I really challenge you to think about whether the small competitors who don't have the working capital, don't have the skill set, don't have the people, don't have NextEra Analytics, can really do these kinds of things. Let's talk a little about growing the business. I talked about leveraging our competitive advantages.
How do we leverage our competitive advantage with what is the best renewables environment in our history, and what kind of growth does that lead to? No secret, this business has shifted dramatically over the years from one that was based really entirely on compliance, right? The slides we used to have on the projector here back in 2010, pre-2010, were all about maps on which state and which place on the renewable portfolio standard. That was what was driving demand, guess what? Wind and solar wasn't cheap. You were going to folks who had to buy to accomplish a state guideline. That has completely changed. Today we sell wind for one reason, because it's three times cheaper than the variable cost to run coal or nuclear.
Today, we sell solar because it's 30%-40% cheaper than the cost to run coal or nuclear, and it's also challenging gas-fired generation on the economics as well. You can see solar, about 75% of the origination has been driven by economics. It's opened up new markets for us. It used to be IOUs, co-ops, munis, but now C&I. C&I is coming to us because it's cheap. It's a cheaper source of power than what they're paying the local investor-owned utility today, and it's green, and it is a great ESG story. What's really driving the cost reductions that we see in wind and in solar? From a wind standpoint, you guys have all seen this chart before, but we've been able to achieve about 15% productivity in wind. How have we been able to do it?
Taller towers, wider rotor diameters that have really increased the efficiency and lowered the cost. Lowered the cost why? Because we have to put fewer wind turbines at any one site, and that's really driven the economics to where we sell wind today right around $10-$15 a MWh, and I would say 15 is really on the high end. These are in our bread-and-butter states in the Midwest, where we have strong wind resource. If you look at 2021, because I know a lot of you have that question, well, what's the price going to be in 2021? What's it going to be in 2020? We expect the price in 2021 to be about the same as it is in 2020. Why is that?
Because the OEMs are coming out with a taller tower and a wider rotor diameter that's basically going to offset the PTC going from 100% to 80%. Feeling really good about 2021. You can see the 2022 economics really aren't that much different from what we've seen in 2020. The LCOEs or levelized cost of energy for solar, about the same 15% productivity gain. Where is it coming from? Worldwide competition for modules, for panels. A real focus on decreasing balance-of-system cost. As those panels become more efficient, you have to install fewer of them. Really helping to drive down the capital cost in that business. I'm sure we all saw the recent announcement on bifacials, right? The manufacturing lines for most of our southeast suppliers were already moving to bifacials because it's just not that much more expensive to produce.
Now with the ITC relief, bifacials are really going to help to continue to push pricing down as well. About $25-$35, we expect that to be a little bit lower in 2022, just as we see the technology to continue to progress. I'll show you a post-ITC view in a few minutes. What's driving wind, right? Where do we think wind prices are going to be when tax credits expire? That's a question that I used to get all the time on the road with all of you.
You can see here, taking a 2020 price down to the post-2023 LCOE, which means no production tax credit. If we can just get a 10% productivity gain, which ought to be pretty darn doable, versus the 15% that we've seen in this market, we're going to be selling wind at about $20-$25. You can see the levelized cost of the PTC at about $20. We'll make up for half of that in a few ways. One is taller towers, wider rotor diameters. The blades are going to get longer. They're probably going to be delivered to the site in two pieces and assembled on-site based on our conversations with the OEMs. There's going to be fewer turbines required, which is going to reduce the balance-of-system cost.
The continued O&M reductions that I showed you earlier, trying to take another 20% out of wind O&M on top of the 25% we've already taken out. Financing efficiencies. Without tax credits, you move from more expensive tax equity to less expensive project finance. We think this 10% productivity is very doable. Similar story for solar. If you can go from that 15% productivity that we've seen down to 10%, you're able to compensate for a lot of the lost value of the PTCs to a point where solar should be exactly the same price when the ITC steps down from 30% down to 10%. Where is it coming from? Increased competition on panel manufacturing, improved efficiencies as more folks get into that business, more innovative thinking on racking systems. Why do they have to be designed at the site?
Why can't you design them off-site, just ship them in, and drop them into the ground? Why can't you use robotics in the field? We could be a lot smarter in this industry about how we're handling the installation and the racking of solar. Huge opportunity for us going forward. The O&M reductions, if we can get to unmanned solar, which we should certainly be able to do, feel very good about our ability to get there. You're taking another 30% out of the O&M. The financing efficiency, again, of moving from tax equity finance to project finance, which will really help drive the economics there. Storage costs. Jim said earlier, storage is the holy grail of renewables. The thing we've never been able to do in this sector is firm up renewables.
The reactions we used to get from the critics was, "Great, wind's cheap, 3x below the variable cost of nuclear and coal. Solar is 30%-40% below that same variable cost, but you can't store it. It's not always available during the hours of the day that I need it, that 5:00-9:00 at night period, my peak hours. Solve that problem for me." We've been able to solve it. We've been able to solve it with battery storage. It's come earlier than we thought. You can see it in the numbers with 40% of our solar origination enabled by batteries last year. The left-hand side of this chart, the cost relative to capacity. What's happening in this industry, it's an industry driven by automotive demand and EV pricing. If you look at that blue line at the end of 2019, think about this.
Right around 35% of that was driven by EVs. They had 35% of the battery market. Power at 5%, consumer electronics at 60%. By 2030, that's going to completely shift. EVs are going to be 80%, consumer electronics are going to be 10%, and power is going to make up about 10%. We expect significant productivity gains to continue to come from increased manufacturing, scale manufacturing. On the battery side, you can see the adders being right around $4-$9. Guess what? At $4-$9, that's going to displace a lot of the gas-fired peakers in this country, where we got a lot of old gas-fired peakers, low capacity factors, high heat rates, expensive to run. Batteries are going to start taking them out. What are the drivers for the storage cost reductions? We expect to move from an 18%-16% productivity gains.
Storage is new. It's still in the early innings. I think it's very reasonable to believe that the reductions will be similar to what we've seen, and it's going to come, again, from significant automotive investment. I think we're really underestimating how quickly electric vehicles are going to come into market, not only in China and India and Europe, but also in the U.S. The balance of system savings. As energy density improves, you need fewer batteries, which means fewer enclosures. We're getting smarter about the enclosure design. We're looking at DC-to-DC connectors and inverters connecting up with the batteries. We're getting smarter on O&M, particularly on degradation of batteries. When you look at energy density, you look at cycle times, you look at temperature and the ability to cool batteries. A lot of opportunities to take cost out there.
While I said the industry had moved to economics, don't forget, there are tailwinds from RPS standards. There are 11 states now that have RPS requirements over 11%. We don't need them because economics drives it, but this is going to be a big tailwind to renewables in the next decade, and it's not only with states trying to take climate goals into their own hands, but it's also feeding over to C&I, as I had mentioned earlier. All of that leads to that 10% productivity that I mentioned in wind and in solar, and the 16% in storage to really cheap renewables, even when the tax credits go away. Wind will be the cheapest form of generation, even when there are no tax credits. Solar will be second.
It'll compete and be much cheaper than the variable cost to run a coal or nuclear plant, and we'll be able to compete head-to-head and probably at the lower end of gas-fired generation. Offshore wind, I'm not going to spend a lot of time on it. Really expensive, we think bad energy policy. It's a very tiny opportunity at about 8 gigawatts. We do that in a couple of years. Why should we distract the organization on something that has a five-year development cycle, and the green bar speaks for itself. Let's talk about the size of the market. Jim mentioned the NREL study. The NREL study is a low-cost renewable study.
If you believe the numbers I just gave you, if we expect to see a 10% productivity gain in wind and solar and 16% in storage, which we think is very doable, this is what NREL, who actually has higher assumptions around cost, thinks is going to happen. They think that the market's going to shift from 8% renewables in 2018 to 39% in 2030. Think about that. That's a huge shift. Where's it going to come from? What do you have to believe to think that's going to happen? One, you got to believe the economic numbers I gave you. Two, you got to believe that 47% in the middle, that yellow bar, that's 28% coal. That's 19% nuclear.
You have to believe that most of that 28% coal probably goes away by 2018, then some of that nuclear that's not backed by state subsidies falls along as well. There's going to be some cannibalization of gas-fired, and it's really going to come, I think, more than anything from gas-fired peakers for the reasons that I gave you before, particularly as you combine integrated solutions with storage. What does that imply? If we're going to get to close to 40% renewables by 2030, that means the renewable market's going to grow at roughly 15% a year through the next decade. That is a massive opportunity for this company, a massive opportunity for this company as we head into the next decade. That's why we feel so good about our growth prospects going forward.
Let's talk about how we take all that into account into our development expectations. Divide this into two parts. First, I want to talk about 2019 and 2020. You can see we're right about 7.5 gigawatts. Well, that's higher than the midpoint we had for 2019 and 2020 at 7.35. Then you look at the signed contracts, right around 3 gigs for 2021 to 2022. What's not in that number is about 850 megawatts of 2023 solar and storage, which puts us up around the 4 gig post-2020 number. But with where we are today with that 7.5, the 3, and then the 23, we're at 11.2 gigawatts. That is the highest backlog we've ever had in our company's history. Then we set the 2021 to 2022 expectations. Well, how do we do that?
We looked at it and we said, look, most of the wind repowering opportunities are going to go away. Why are they going to go away? They're going to go away because we did such a darn good job in basically capitalizing on every single opportunity we had in our portfolio through 2020. Okay? But even with the wind repowering going away, our midpoint's going up from 7.35 to 7.4 gigawatts because that's how we feel about the demand that's going to be driven by all the things I just went through on wind and on solar. Don't lose out on the fact that we have a terrific head start on hitting those objectives.
When you take a look at our ability to hit that 1,075, which Jim said he'd be disappointed not to hit, and you look at Eric's capital plan, you look at Marlene's capital plan, and you look at our head start with all the opportunities that we have, you have to feel pretty good. Disruption. It's not only about leveraging our playbook. It's not only about capitalizing on the best renewables environment in our history, but it's about continuing to disrupt the rest of the sector, doing things that nobody else can do. We talked a lot last time about it being really an energy generation play around economics. Well, it's also changing to more ESG. There's going to be more of an RPS focus as well that's going to continue to drive that disruption as states now really want that coal to come offline.
It's technology. Don't underestimate the impact of technology and the skill sets of companies to be able to leverage that technology to drive better development solutions, better operational solutions, and better customer solutions. Right strategy at the right time, very well-positioned in our renewables business. Let me talk a little bit about the rest of the portfolio. Again, no surprise here. 80% of the adjusted EBITDA is coming from renewables. We are a renewables company at our heart. Roughly 2% on merchant. Again, Seabrook is essentially the only merchant asset that we have in the fleet with our capital recycling activity, and about 18% coming from the peripheral businesses, which is really growing in line with the rest of the company, which I'll talk a little bit more about.
Don't forget how important those peripheral businesses are from a market knowledge, information, and customer development standpoint, which I'll touch upon in a minute. Again, primarily a renewables business. 30, 34 gigawatts by the end of 2022, which is where we expect to be. The cash really being driven by the renewable investments, a 15% CAGR there. The long-term contracted business doesn't stop there. It also goes to nuclear. Our nuclear portfolio is really a long-term contracted nuclear portfolio. 70%, even including Seabrook, is long-term contracted. Point Beach is fully contracted. Seabrook is one-third contracted. Because the deal we just signed was Connecticut. We had always been doing some co-op deals off that asset. Then finally, Duane Arnold, which is being retired for all the reasons I just gave you.
It can't compete in a low renewable environment, even though we have the best nuclear team in the business. Top decile in O&M at every site, tops in safety, tops in reliability, and we still couldn't make it work at Duane Arnold because of renewable economics. Natural gas pipelines. This is a toe-in-the-water business we started a few years back. You can see by 2022, we expect to be right around 6.5 to $7 billion of CapEx in this business. Sabal Trail, Florida Southeast Connection, the net midstream acquisitions that we're able to do at NEP, and then MVP, which I'm going to talk about in a minute. Also, we have some terrific opportunities in our portfolio right now.
Multiple opportunities that we expect to be able to execute on going forward, leveraging all the skills that make us successful in renewables, which naturally translate over to pipelines. You can see the growth in that business from one that didn't exist a few years ago. Mountain Valley Pipeline. Jim touched briefly on this. Again, it's resumed construction. About 90% complete. We expect by the end of 2019, continue to make progress on some of the permitting issues. The one you're probably most focused on is the Appalachian Trail. We have alternatives that we are pursuing with our partners. I'm not going to go into details on any of those, our expectation is to be able to achieve a COD in 2020 and for the CapEx to go up a bit to right around $5 billion.
Regardless of the outcome, we feel good about where we are on MVP, really not much of an impact to NextEra Energy's overall performance either way. Transmission. I went from one long-term contract to rate-regulated business to another. Transmission, a great long-term contract to rate-regulated business. Toe in the water. Didn't exist. $3 billion of CapEx on the high end by 2022. When you combine that with the potentially seven on pipes, that's $10 billion of long-term contract to rate-regulated businesses. On top of renewables, on top of nuclear. A terrific story. Very happy with what Eric Gleason and his team has been able to accomplish in this business. You can see all the opportunities that we have. We have had an incredible hit rate in competitive transmission.
Out of the $6 billion of opportunities that have been presented through RFPs in this business, we've gotten 30% of them. That's pretty amazing when you think about the fact that we are always going into somebody else's backyard and trying to steal an opportunity away from them. Really terrific execution. I think it's a great example of the skill, scale, scope, and talent, and people that we have in that business, and a great complement to what we do on the renewables side, which is a good transition to the peripheral business. The peripheral business is growing in line with the rest of the company, as I said earlier. Our customer supply and trading business, it's a customer flow business. It's directed towards full requirements, middle marketing, things that are our customer flow transactions.
We get a ton of leverage out of this for the rest of our business. Those customer relationships, many times end up being converted into long-term PPA opportunities on the renewables side or pipeline customers on pipes that are being built by our Gas Infrastructure Business. Don't underestimate the amount of information and market knowledge that impacts our decision-making on development of wind and solar, and what sites to pick, and transmission congestion, basis dislocations, gas to power correlation, all those things. Amazing talent, amazing culture, great skill set that we bring to bear on the rest of the business. Requires very little capital, and we get terrific returns out of it, but we'll always keep it small and contained and growing in line with the rest of the business. Gas Infrastructure.
A business we got in a few years ago because we're North America's largest consumer of natural gas. Was smart to understand gas price movements and how it impacted our strategic decisions across NextEra. Think about what this has done for us strategically. We made much better decisions about long-term hedging around our merchant assets. It drove our decision to sell our merchant assets based on what we were seeing. It created a ton of new opportunities for us in natural gas pipelines. The financial outlook, no surprise on the CapEx. The green bar is renewables. Very simply, that's the story at Energy Resources. We're a renewables company. That's where the CapEx is going. If the CapEx is going into renewables, you would expect the growth in EBITDA and earnings to follow. That's what you see here.
Out of the 12% CAGR from 2018 to 2022, we expect that to come primarily from renewables. Same story on the earnings side, 12% growth coming there. Renewables, that's where we're investing our capital. Energy Resources is a renewables company, and that bodes well not only for NextEra Energy Resources and NextEra Energy, but think about what that does for the future prospects of NEP. You take that 29 gigawatts, if you include our current backlog, with all the opportunities that we have going forward, NEP has terrific visibility into how it can support its growth going forward, and that's why it was an easy decision to extend the growth out an additional year. With that, I will turn things over to Mark Hickson.
Thanks, John. Well, Jim spoke about the fact that in his 18 years at the company, this is the best period of time at NextEra Energy. I feel the same way about NextEra Energy Partners. I think back to the first half of 2014 when Dan Lotano and I were busily working on the IPO. Dan Lotano runs NEP for us. If you think about what was going on in the industry at that time, the fact that in 2014, we were looking at largely the expiration of tax credits around the 2016 timeframe, versus where we sit today, where we have the longest line of sight probably pretty close in the history of renewables in the U.S. In 2014, we had cost declines, technology improvements, but those cost declines and technology improvements, as John just ran through, are accelerating.
Back in 2014, we really weren't talking about energy storage opportunities. Where we sit today, as John pointed out, in 2018, for Energy Resources, about 40% of the additions to the solar backlog came with energy storage. As a result, where we sit today is NEP is in a great position from an industry standpoint, looking at somewhere in the neighborhood of 15% growth in the renewable energy industry, additional opportunities in natural gas, looking forward to opportunities, eventually, in energy storage. We have built up a portfolio of assets at NEP that is starting to give us benefits of organic growth opportunities, which are also really attractive. We are very excited. This is the best time in the history of NEP. That is why, in part, we extended the guidance, distribution growth guidance, 12%-15% through 2024.
Hopefully you're going to get a sense for all of the things that we're excited about as I go through my presentation. Talk about the NEP value proposition. We're going to talk about growing NEP, financing that growth, and finally end with the long-term growth outlook. I'm not going to touch on each item on this page because Jim went through them in detail. NEP has successfully delivered on its key objectives from the 2017 investor conference. The fact that NEP has done so positions the company very well for continued success in 2019 and going forward. Been five years since the IPO. I was going to give the June 27th plug, but Jim has already stole my thunder on that. Over that five-year period, we've accomplished quite a lot at NEP.
We've significantly expanded the renewable energy portfolio from approximately one gigawatt at the time of the IPO to where we sit today, over five gigawatts of renewable energy capacity. In addition, we've added approximately four Bcf of natural gas pipeline capacity. As you can see from the map on the right-hand side, we have significantly diversified the portfolio geographically as a result of acquisitions of assets from Energy Resources and third parties. In addition to geographic diversification, we have significantly diversified the portfolio by asset type, significantly reduced the project concentration, expanded the customer diversity to almost 50 counterparties today, and as I mentioned, geographic diversity as well. As a result, where we sit today is NEP's value proposition is built on four core strengths. The first, high-quality portfolio. I touched on this on the prior pages.
Over the last five years, we've built up a very diversified portfolio of assets that is now a very high-quality portfolio. The second, financial strength and flexibility. NEP has an attractive distribution coverage ratio, strong credit ratings, and the ability to opportunistically access the capital markets in a variety of alternatives on very attractive terms. Third, tax advantage structure. This is a very important point for the NEP unit holders. As a result, I'm going to go into this point in detail on the next slide. Lastly, opportunities for growth. NEP has three primary avenues for growth. The first, organic growth opportunities. I'm going to touch on two really attractive organic growth opportunities here in a second, one at our Texas natural gas pipeline, and the other, repowering opportunities at our wind facility. The important point to make here on the organic growth opportunities, they're just getting started.
We announced our first organic growth opportunity in fall of 2018. These are, as you're going to see, very attractive opportunities being done in very attractive investment terms. As NEP's portfolio continues to expand and diversify, these organic growth opportunities are going to continue. Next, the potential acquisition of assets from Energy Resources, and finally, the potential acquisition of assets from third parties. I want to talk a little bit more about that structural tax advantage as a core strength. As you know, NEP is a C corp for tax purposes, which means that it is a tax-paying entity.
However, due to the tax attributes of assets acquired by NEP, including the ability to achieve a step-up in the tax basis of assets, as well as the related tax depreciation, NEP is able to offset its taxable income such that NEP is not expected to pay meaningful U.S. tax for at least the next 15 years. In addition, as long as NEP has no current earnings and profits, distributions to unit holders is treated as a return of capital, and as a result, LP investors are not expected to pay taxes on distributions for at least the next eight years. Finally, as I mentioned before, NEP is a C corp for tax purposes, which means investors receive a 1099 versus a K-1. We believe that this allows NEP to tap into a much broader investor base.
You can see what is a very attractive total return potential on the right-hand side of this page. The combination of distribution growth, distribution yield, and approximately one percentage point increase as a result of the earnings and profits tax shield, results in a very attractive total return potential of 16%-20%. I'm going to show you later on in the presentation the fact that this distribution growth is really best in class when you compare it to other companies in the S&P 500. In addition to the four core strengths I just outlined, NEP has a number of operating advantages by virtue of NEP's access to the Energy Resources platform. John just spent a lot of time walking through with you all of the advantages and reasons why Energy Resources is the leading developer and operator in our industry.
That translates into operating advantages for NEP. The development expertise, the operating expertise, John spent a lot of time on the AI and data analytics, all of which are going to serve to benefit NEP as well. Going to result in strong wind and solar operations and getting better. Expected to improve approximately 20% and 30% in wind and solar, respectively, by the year 2022. The development expertise is really going to come in handy as we move forward, as NEP's portfolio continues to expand and diversify, resulting in an increased level of organic growth opportunities. NEP's ability to leverage the Energy Resources platform over time through operation improvements, development expertise, is expected to result in an increase in cash available for distribution and drive long-term unit holder value. Now I'm going to spend some time talking about growing NEP.
Since the IPO five years ago, NEP has had a consistent growth strategy of acquiring clean energy assets with strong cash flows, long-term contracts with creditworthy counterparties. We have acquired and/or developed wind, solar, and natural gas pipeline assets, and will continue to do so going forward. In addition, we may acquire or develop energy storage assets as well as other clean energy assets. The combination of the characteristics of assets on this page in the blue and the types of assets on the outside circle on this page, along with the three avenues of growth that I've talked about before, namely organic growth opportunities at NEP, the potential acquisition of assets from Energy Resources, as well as third parties, all support NEP's ability to continue to execute on what has been a very successful growth strategy.
The potential acquisition of assets from Energy Resources provides clear visibility into continued growth at NEP. Since the IPO of NEP, Energy Resources has significantly expanded its portfolio from approximately 10 gigawatts at the time of the IPO to where we sit today, where just a combination of renewable energy capacity and operation, along with the existing backlog, totals approximately 21 gigawatts. That, coupled with the expected future development through 2022, totals 29 gigawatts. As a result, the Energy Resources portfolio alone provides one potential path to allow NEP to grow its distributions by 12%-15% per year through 2024. NEP is also well-positioned to benefit from significant wind and solar growth that's expected in the U.S. You heard this in John's presentation. This is the best time in the history of the renewable energy industry, and you can see that highlighted on this page.
In addition to the 5 gigawatts of renewable energy capacity at NEP and the 21 to 29 gigawatts of capacity that I spoke about at Energy Resources, the combination of renewable energy capacity and operation, plus expected future development through 2030, totals approximately 500 gigawatts. From a generation perspective, U.S. renewable penetration is expected to increase from 8% to approximately 40%, implying about a 15% compounded annual growth rate. NEP is very well-positioned to capture a meaningful share of the growth opportunities in renewable energy. I should point out, a few pages ago, we talked about the types of assets that are suitable for NEP, including long-term contracted natural gas pipelines and energy storage, which are not on this page. NEP is also very well-positioned to capture a meaningful share of those opportunities as well.
You might ask, why do we feel so confidently that NEP is going to capture its fair share of opportunities that I spoke about on the prior page? There's a number of reasons for that. The first is NEP's trading yield. NEP has the lowest trading yield when compared to its MLP and YieldCo peers, which allows NEP to raise equity capital at a lower cost. Second, NEP has the ability to raise other forms of capital at a lower cost, and in some cases, like the convertible equity portfolio financing that I'm going to run through in a second, in ways that our competitors can't. Next, the operating cost advantage that I talked about. The ability to leverage the Energy Resources platform, making NEP strong in wind and solar operations, is a really competitive advantage to bring to bear when looking at third-party opportunities.
Finally, NEP's better-than-15-year corporate tax shield provides another advantage. Very excited about NEP's ability to capture a meaningful share of the opportunities in the clean energy space. On the next two pages, I'm going to talk about the two organic growth opportunities at NEP. The first is a natural gas pipeline expansion project. We announced this project in the fall of last year. More specifically, it's the installation of natural gas-fired compression at one of our stations. Comes with a long-term contract, expected to be in service towards the end of next year. You can see here it's about a $115 million capital investment and a very attractive implied EBITDA multiple of about 7x. Upon completion, it is expected to result in about a $15 million-$20 million uplift in cash available for distribution from the natural gas pipeline segment of NEP.
Very excited about this organic growth opportunity because it provides a window of things to come as it pertains to future organic development in the natural gas pipeline assets of NEP. Second organic growth opportunity I want to talk about was announced today. We reached agreement to repower about 275 MW at two of our sites. Expect a completion next year. This repowering has a number of benefits to NEP. Obviously, the repowering results in increased production. Upon completion of the repowering, it enables NEP to raise PAYG tax equity financing to pay off existing debt, which serves to further increase the cash available for distribution. Obviously, a repowering is going to lead to longer asset life and lower maintenance costs. You can see the meaningful uptick in cash available for distribution as a result of this repowering. $15 million-$20 million prior, and $40 million-$50 million after.
These types of organic growth opportunities that are being done at very attractive investment yields, again, are a sign of things to come at NEP as this portfolio continues to expand and diversify. We talked about growing NEP. I want to talk about financing that growth. NEP is very well-positioned to finance its growth over the coming years. As a combination of a strong balance sheet, credit ratings, and all of the financing flexibility shown on this page. We've actually utilized all of the tools on this page, some of which didn't exist at the time of the IPO. We actually created some of these financing tools. As Jim pointed out, we have a very creative team that's working on NEP, and we've created some of these financing opportunities from scratch.
The ability to access low-cost capital in all of these different forms is a significant competitive advantage for NEP. One example of NEP's financing flexibility is the fact that NEP recently upsized its revolving credit facility from $750 million to $1.25 billion, and in the process, improved the pricing, expanded the number of banks, and extended the maturity to almost two years. This new credit facility provides NEP with additional liquidity to support all of the growth opportunities that I just spoke about. As I mentioned before, we've used a variety of financing alternatives at NEP to finance the growth over the last five years. About $4 billion of the capital raise, or more than $4 billion of the capital raise has come from equity and equity-linked financings, which serves to increase the float and liquidity of NEP over time.
That has represented about 70%, more than 70%, of the capital raise. Again, a lot of these financings were not contemplated at the time of the IPO, and I expect that we will continue to find creative ways to finance NEP's growth going forward. One creative financing in particular that I want to spend some time on the next few pages, is the convertible equity portfolio financings that we've done over the course of the last year. This page provides a comparison of equity-linked financing alternatives, along with attributes that we believe are important to consider in the context of these financings.
The combination of having a low annual cash cost associated with the security, the ability to retain the upside in the NEP units associated with the conversion of these securities, as well as the ability to extend the period of time upon which these securities convert to equity, and having NEP's option to convert the securities at any price, all result in the ability to mitigate and reduce the amount of dilution that is associated with the conversion of these securities. Very important attributes to consider in the context of equity-linked financings. In addition, the ability to be afforded strong equity treatment by the rating agencies is also another very important attribute.
As you can see from the right-hand side of this page, the convertible equity portfolio financing is the only equity-linked financing product that meets all of these very important attributes and is the reason why we believe that the convertible equity portfolio financing is the superior equity-linked financing alternative. I'm going to go into a little bit more detail on the two financings that we've done. The first in the second half of 2018, transaction with BlackRock, $750 million, about a 2.5% per year cash coupon over a three-year period. All-in cost about seven and three quarters per year over a three-year period. The combination of the buyout right timing and the buyout right payment effectively means that the conversion of this security at NEP's option occurs in year four. Fast-forward to 2019.
Transaction with KKR, $900 million proceeds, less than 1% per year coupon over a six-year period, a little bit more than 8% all-in cost of capital per year over a six-year period. The conversion of the KKR security at NEP's option occurs between years three and a half and year six. We're very happy with the BlackRock financing, and we continue to be very happy with that financing. The KKR financing offers a lower cash cost and the ability to convert the security over a longer period of time, which all serve to enhance NEP's financing flexibility. Now I want to compare the two convertible equity portfolio financings that I talked about on the prior page with a convertible preferred transaction that we announced in 2017. You may recall, in the second half of 2017, we announced a $550 million convertible preferred security financing.
That financing came with a 4.5% coupon, and it entitled the holders of that security to convert their security at a price that was 15% higher than the NEP price at the time of issuance. You compare that to the two convertible equity portfolio financings that I just ran through, you see that those financings have lower cash costs and the ability to retain 100% of the NEP unit price upside. The low upfront cash costs and the ability to retain all of the upside are the reasons why the convertible equity portfolio financing is superior to the convertible preferred, as well as the other equity-linked products that I ran through earlier. You may say, "You know what? All that's great. I get why the convertible equity portfolio financing is the superior equity-linked financing alternative.
All that equity-linked stuff is really complicated, and what you really should do is just issue straight common equity in the context of financing acquisitions and organic development." Hopefully, this page will show you why we've moved away from those types of financings over the course of the last year. On the left-hand side of this page, we take a generic asset that's $105 million. With the low cash cost of the convertible equity portfolio financing, the net cash flow to the NEP unit holder is $100 million.
Compare that to the same asset that's financed with common equity, where the combination of the 4%-5% cash cost of the dividend, along with the additional IDRs that are required as a result of the equity issuance, result in the fact that the same asset financed with common equity requires twice the amount of assets to achieve the same level of cash flow. The convertible equity financing significantly reduces the assets that we need to achieve NEP's growth targets. Putting it all together, the low upfront cash costs means more cash available to the LP unit holders. Low upfront cash costs means lower future asset needs, while achieving the same level of growth. Lower future asset needs means lower future financing needs.
All of which means enhanced value to the NEP LP unit holder, is one of the reasons why NEP does not expect to need to sell common equity until 2021 at the earliest. Finally, I'm going to talk about the long-term growth outlook at NEP. Before I do that, I want to spend a little bit of time talking about PG&E. I made it almost 30 minutes without talking about PG&E. As you know, earlier this year, PG&E filed for bankruptcy, that bankruptcy filing resulted in trapped cash at the NEP projects, the total being approximately $100 million.
In response, NEP, as part of the KKR financing this year, acquired additional assets from NextEra Energy Resources and refinanced some of its existing assets, all of which resulted in an increase in cash available for distribution of approximately $125 million, significantly in excess of the $100 million of trapped cash at NEP. What does that mean? That means that NEP, we are very well-positioned to meet our 2019 run rate guidance, also very well-positioned to meet our 12%-15% per year distribution growth guidance through 2024. Now, despite that, we are busy evaluating and considering several mitigating strategies to release that trapped cash. You can see some of them here on the page. I'm not going to go through each one of them, we're actively considering all of them. We're closely monitoring the situation at PG&E.
I, in fact, sit on the Official Committee of Unsecured Creditors for PG&E, we are confident in our ability to reach a successful resolution of the PG&E situation as it pertains to the NEP projects. One example of the mitigating strategies we actually announced on Monday, this is the launch of a tender offer to purchase 100% of the outstanding holding company notes at our Genesis project. About $240 million. We launched the tender because we believe that there is value in the Genesis project. PG&E continues to honor its obligations under the PPAs, we're confident that the PPAs will remain in place post-exit from bankruptcy. You can see on the right-hand side some of the pricing terms of the tender. Again, we launched it on Monday. The tender offer expires on July 16th.
We have an early tender period on June 28, which allows holders who tender earlier to get a little bit better pricing. The most important thing, if there's anyone here in the room that holds Holdco bonds, I would encourage you all to participate. The combination of the organic growth opportunities that I spoke about earlier, the expansion opportunity at our Texas natural gas pipelines, the wind repowering opportunities, along with the cash that is currently trapped at NEP, are resulting about a 22% uplift in the run rate cash available for distribution. You can see that we have significant embedded growth within the NEP portfolio. The future release of the PG&E cash flow, along with these organic growth opportunities, translates into about one and a half years of CAFD and distribution growth. Very focused on this significant embedded growth opportunity. Now, financial expectations.
Run rate guidance, consistent with what we've talked about before for 2019. Then we extended the distribution growth guidance of 12%-15% an additional year through 2024. This distribution growth guidance is best in class in our opinion. Hopefully you can see why on this page. There are only eight companies in the S&P 500 that are expected to deliver distribution growth of at least 12% over the next several years. You see that peer set of companies on the left-hand side of this page. Total return of approximately 15% as compared to NEP, that is around 19%. NEP has a superior total return potential. Despite that, NEP's distribution yield trades at twice the level of this peer group. It feels like there's an opportunity there from a value standpoint.
Speaking of value proposition, on the left-hand side of this page, you can see that NEP compared to its MLP and YieldCo peers has by far the longest growth runway, all the way out to 2024. The next highest is 2022. The reason why we extended the growth guidance was a number of reasons that you see here on the page that I ran through. The expected 15% per year industry growth through 2030. The ability of NEP to achieve its growth objectives in three primary ways: organic growth, acquisition from Energy Resources and third parties, and the flexibility that we have to finance that growth in a variety of ways. We have a favorable tax position, low-cost operations, and a history of successful execution on the growth strategy. We do not believe that all of these attributes are factored into NEP's price.
We've successfully executed on the objectives that we set out in the 2017 investor conference, and we are well-positioned to achieve NEP's growth guidance going forward. Pass it over to Rebecca.
Thank you, Mark. Now we are officially in the home stretch. I have just a couple of concluding comments to talk with you and share with you this afternoon, and then we will open up for questions. We may run just a little bit over the 12:30 mark in order to get in a couple of extra questions from you. We've given you a lot of information over the last couple of hours. We've talked a lot about our strategies, about the disruption in our industry, and how we plan to take advantage of that, as well as about our culture. I just want to make a couple of synthesizing comments about the things that we've told you about, and also talk a little bit about how we finance it, particularly at NextEra Energy. Let me start with NextEra Energy Partners.
Mark already walked you through a significant amount of the important takeaways that you should have from NextEra Energy Partners. At the bottom line, it is that it is a strong, clean energy company in its own right. And it has terrific growth prospects throughout the expectations window and beyond for what we talked about with you today. The opportunity is a threefold: organic growth through continued acquisitions from NextEra Energy Resources, as well as the opportunity to acquire projects from third parties. We're talking against a backdrop, as both John and Mark talked about, of substantial growth in the renewable sector. An estimated 15% per year through 2030, perhaps higher than that if you believe that adoption will happen faster or for longer, if you assume that it doesn't, and renewables continue to be as economic as we believe that they will be.
That is a terrific growth backdrop. As Mark just highlighted as well, it's not simply limited to the renewable sector. Any clean energy asset with long-term contracted cash flows is a possible asset to build into the NEP portfolio, and we're excited about what the opportunities are for us. We are confident in our ability to extend these expectations, now out to 2024, of being able to deliver 12%-15% distributions per unit growth throughout that timeframe. As Jim and Mark and John all highlighted, we are as confident as we have ever been, as excited as we have ever been about the outlook for NEP. Let me talk a minute about PG&E. I didn't make it quite as long as Mark did. PG&E, we continue to believe, it will be resolved favorably, at least with respect to our contracts.
We have the flexibility and the visibility to deliver the expectations that we've talked about today, regardless of what happens with PG&E. If PG&E, and when PG&E is resolved favorably, that release of cash flow, along with the organic growth opportunities that Mark just laid out and that we've announced today, represents a year and a half of growth on their own, which is a pretty powerful equation and gives us incremental confidence about our ability to deliver the expectations that we've laid out for you today, which of course assume certain normal operating conditions and normal caveats. Notwithstanding our confidence and ability to deliver, if I simply highlight to you about NEP's trading yield relative to the 10-year Treasuries over the last two years, we are trading at the highest spread, the least favorable spread we have in the last two years.
We believe a lot of that is related to PG&E, and we think it's overdone. If NEP simply traded at the average of where we have traded for the last two years on the spread to Treasuries, that represents a 20% higher NEP unit trading price than where we trade today. Where else can you find a company that has debt to EBITDA of less than five times, has a dividend yield greater than 3%, has delivered distributions per unit growth of over 100% over the last four years, and has forward expectations for the next three years of being able to grow distributions per unit another 12% per year or more, in our case? That NextEra Energy Partners has the visibility out to 2024 into the middle part of the next decade.
There is only one company that meets those metrics, and it is NextEra Energy Partners. Between our distribution yield as well as our distribution growth expectations out through 2024, that is a 16%-19% total return potential on an annualized basis. It's a terrific value proposition. We are just getting started and couldn't be more excited about the outlook that we have for NextEra Energy Partners. Let me turn now quickly to NextEra Energy. Our strategy has remained largely the same for a number of years, and we are unapologetic about that. That strategy has delivered significant value to our customers and significant value to our customers. Let me start first with Florida Power & Light Company. We are supremely focused on delivering superior value for our customers. Low bills, high reliability, terrific customer service, all while delivering clean energy electricity to our customers.
We're doing that by taking cost out of our business and deploying modernized generation in order to drive efficiencies throughout the portfolio. We're deploying technology. We are disrupting ourselves in order to find efficiencies across that portfolio. As Eric highlighted, we are just getting started at Florida Power & Light Company. Just between the significant capital deployment opportunities and the programs for solar to bring solar to Florida in a meaningful way, as well as continued modernization of our grid infrastructure for storm hardening and reliability, we have multi-decade opportunities to continue delivering the same way that we've been delivering in the past and improving the customer value proposition for our customers at Florida Power & Light Company. One of Marlene's slides highlights the value of the FPL strategy best. Eric, a lot of your slides did too, but Marlene's slide was particularly good in my mind.
It was that over the last decade, Florida Power & Light has grown its regulatory capital employed or measure of our investment in the business 10% per year and lowered bills 9%. Over that same timeframe, Gulf Power invested to grow its regulatory capital employed 5% per year, so roughly half the growth, and its bills went up 30%. That's the opportunity we have at Gulf Power. Change the strategy and deploy the Florida Power & Light playbook. Already, Marlene and the Gulf Power team, our employees, have identified $100 million in run rate savings across Gulf Power, and they've identified roughly $3 billion of capital investment, smart capital, to invest in our portfolio that will deliver meaningful improvements in our customer value proposition. Marlene highlighted these for you.
A 50% reduction in O&M. A 50% reduction in fuel, 100% reduction in the capacity clause, these will translate to meaningful improvements for our customers in terms of reliability, a 20% improvement, and a 40% reduction in CO2 emissions. This is in the next three years. What our customers may notice first is that we expect our bills to go down 9%. As Marlene highlighted, we're just getting started, and if you look out to the mid-2020s, we are targeting a bill in the roughly $120 range for an average 1,000 kilowatt-hour bill. Roughly 20% improvement in real terms for our Gulf Power customers. For our shareholders, that translates into a roughly 16% annual CAGR growth in net income contributions. Let me turn now to NextEra Energy Resources. John highlighted that we are totally focused on continuing to develop North America's leading renewables developer.
We have significant competitive advantages in this market, and we are operating against an amazing backdrop. The 15% growth that is driven by economics and is with a tremendous tailwind of growing appreciation in the broader market about the value of clean energy generation for our environment, for our communities. We are excited to continue delivering on the growth opportunities across the renewable sector and believe that we have the competitive advantages from our scale, from our experience in engineering construction, being able to deliver the projects, from our development organization in order to be able to find the right projects, as well as our operations team to be able to operate them efficiently over the long term. The technology of revolution, as John highlighted, is significant.
It's probably intuitive to you about what we can do from an operation and maintenance side in order to deploy technology to continue to improve how we operate our fleet. It may be less intuitive for you to understand how important technology is to us being able to win new business. As John highlighted, to be able to identify in advance where customers should want their generation solutions, to help them to identify what solutions are best for them, and be able to get in the queue first and develop the project and be ready with the right project at the right time so we can win their business and deliver value to them. That is going to create some of the competitive advantages along with the competitive advantages you've long known and we've long taken advantage of.
With this terrific growth outlook across each of these businesses, we are very pleased to be extending our guidance expectations today out to 2022, and we now expect to grow our adjusted EPS 6%-8% off of the 2021 realized adjusted EPS. This is a high-confidence outlook for reasons I'll continue to talk about in the remarks, as Jim highlighted, we would be disappointed if we were not at or near the top end of this range. Throughout all of this, throughout all of our growth, I'll highlight something and talk about it more now in the next couple of slides. We remain completely committed to having a strong balance sheet as we continue to grow our business.
Over the last 8 years, we have significantly, meaningfully changed the mix of our business to higher contributions from regulated assets, having grown our regulated contributions from below 60% to now 70% today and roughly 70% also in 2022. When you add in long-term contracted cash flows to that, our adjusted EBITDA has gone from under 80% from long-term contracted and regulated to now over 90%. This didn't happen from one transformative transaction. This happened from a disciplined execution of our strategy. We've grown our regulated businesses. We've acquired regulated businesses. We've divested of our merchant assets. We've entered into longer-term contracts for our existing assets, adding incremental value to the investments we'd already made in the past.
Of course, as we've expanded our energy resources business, we have continued to increase our focus on ensuring that we have long-term contracts in place before the time of capital commitment. If you just look at the pie chart on the left and the pie chart on the right, you see a significant shift from below 50% to nearly 75% of our projects were merchant before 2007, to now 100% of our generation projects have long-term contracts before we build them, ever since 2012. I'll highlight to you, one of the reasons why we made this shift is one of the things that John talked about in his presentation, and it was related to our dip-the-toe-in-the-water approach. We started making small investments in gas infrastructure near the beginning part of the shale gas revolution.
Because of those small investments and the realization of what was to come, we started entering into more contracts, making sure that those contracts were longer than what we had even previously been doing, and we did start the divestiture process of most of our merchant assets because of this. We learned a tremendous amount from this dip-the-toe-in-the-water strategy that better informs what we do and helps us keep capturing strategic advantages like this one. Our credit ratings are some of the strongest in the industry. If you just look at the bell curve, we're on the left side of it, which is the place that we want to be. We believe it's a competitive advantage to have a strong balance sheet and to maintain strong credit ratings.
I can highlight a number of reasons why that is the case, but probably one that is very easy for you to understand, especially for how we focus on it today, but in part because We were able to acquire Gulf Power, enter into the transaction last year, and close at the beginning of this year. Being able to take advantage of that because of the strength of our balance sheet is critically important to being successful and getting an edge in this industry. Our change in business mix from more long-term contracted and more regulated contributions certainly has been noticed by the rating agencies, and they've improved their views on our business mix as a result of that. We remain disciplined. We remain committed to our strong balance sheet, and that is unwavering. Let me talk now a little bit about how we finance our business.
We have a diverse set of banking relationships. We have over $21 billion of credit from 100 different institutions across 18 different countries and four continents. I often talk and make a joke about playing the game of "Where in the world is Paul Cutler?" Paul is here today, and many of you know, along with the rest of the treasury team, including Joe Balzano, we spend a lot of time talking with the rating agencies and with our credit providers and the other broader relationships in the banking industry. We want to make sure they understand what our strategies are, they know where we want to grow our business and why, and that they're in a position to help us when we need them to make sure that we can fund the business in a most cost-effective way.
We ask them to bring us their best ideas and their best people, and most of them deliver. Let me turn quickly to our credit facilities. We have the largest credit facility in the industry at $12.8 billion, and this year we extended 6.4 of that out to 2024, providing us long-term visibility for our liquidity needs. Our financing strategy is really, in many ways, opportunistic, ensuring that we get low cost of capital wherever it may be. While it may be opportunistic, it also has produced terrific results. Our average debt tenor is longer than our peers in the industry and is at lower cost. Our strategy at FPL is typically to enter into long-dated maturities and shorten up as market demands and opportunities present themselves.
At Capital Holdings, which is how we finance much of Energy Resources business, we typically finance on-balance sheet, and then we enter into project finance or tax equity structures at the time of commencing operations. I'd be remiss if I didn't highlight some of our internal sources of cash flow, which obviously fund a significant amount of our business as well. We have terrific cash generation across our existing business. If you added up all the small numbers here, fortunately, you have it in front of you, along with the capital recycling proceeds, you'll see that it's over $30 billion, which funds a significant amount of the growth opportunities that we plan to invest in in the coming years.
As Jim highlighted in one of the first slides that he presented, talking about our culture and what's really important and differentiates us versus competitors in the industry, two of the key factors is financial discipline and making sure that we meet the market test in everything that we do. We don't need to make investments because we do have terrific organic operations, cash flow generation from our existing operations. Here is a hypothetical scenario for you. If we simply took the cash flow generations from our existing assets, and instead of deploying growth capital to grow our business, we simply deploy the capital to maintain those operations. Our business generates substantial cash flow, and if we simply return that cash flow to shareholders instead of redeploying it in the business to grow, we returned it to our shareholders.
That is one path alone to meet the 6%-8% adjusted EPS growth out through 2022. We'd like to call this our put our feet up, take a vacation, go golfing type scenario. That's one of the reasons why we have such high confidence in our ability to execute on the expectations we've laid out for you today. I'd also be remiss to tell you that's probably not the most likely outcome, not only because we have terrific growth prospects as we've outlined for you today, it is also not in our DNA. We are absolutely the type of folks that go after the opportunities that we believe create incremental shareholder value, which we believe the opportunities that we laid out for you today absolutely do. That financial discipline is key to everything that we do.
We ensure that each investment creates incremental opportunities because there is no reason to dilute the power of what we already have. We should only make those investments if they add to it. We talked a lot about our adjusted EPS growth, talked to you about our cash flow generation profile organically as well as with our growth opportunities. Our dividends per share expectations are also very strong in terms of an outlook. We continue to expect to be able to grow dividends per share 12%-14% through 2020 off of our 2017 base. As this is a board decision, we plan to talk with the board about it early in 2020. I wanted to highlight for you today that our dividend payout ratio continues to be roughly around 60%, our expectations for 2019.
With that and our strong adjusted EPS growth, combined with cash flow generation that's growing at an even more rapid rate than our adjusted EPS guidance, it positions us very well to continue to have a very attractive growth profile for our dividends per share relative to our peers. Let me bring it all together. Where else can you find a company that is investment grade, has a market capitalization greater than $20 billion? It's sizable enough for investors such as yourself to establish a meaningful position. Has an adjusted EPS CAGR over the last five years of 8% or more. They've delivered that growth. Has a total annual return of greater than 10% for the next three years based on current dividend yields and consensus expectations, as well as a dividends per share CAGR of greater than 10%.
All of this with a market beta of less than 0.5. There is only one company, and that's NextEra Energy. We are very excited about what lies ahead. We are just getting started, and that is both at NextEra Energy and NextEra Energy Partners. We appreciated the opportunity today to lay out some of our plans and our excitement for what lies ahead of us. Now, I'd like to welcome Jim Robo, our Chairman and CEO, to rejoin me on stage, along with Eric Silagy, Marlene Santos, John Ketchum, and Mark Hickson, and we'd be happy to take your questions. There's several folks that are going to be in the hallway, in the aisles, with microphones. Please, if you wouldn't mind, give us your name, then feel free to ask your question.
I think Julian has a question.
Safe bet.
Predictable.
Yeah.
Wow, guys. Wow. That was a lot. Thank you. Maybe first question for you, Jim. Let's talk a little bit about the renewable growth and just conceptually, the competitive pressures out there, right? You guys showed pretty clearly the sources of where you're growing your renewables businesses. I know that a lot of your competitors talk about the competitive pressures and returns, et cetera. I'm sure you've heard these out before. You also clearly articulated you're focusing on the municipal and cooperative and the C&I opportunities. How do you continue to scale this business, even as the volumes grow, but the competitive pressures seem to expand? Maybe that's the first one.
Yeah. Julian, I think one of the interesting things about the renewable business, I've been in it now for nearly 20 years, is our competitors have come and gone over that period of time, right? The Europeans were some of our biggest competitors in the early 2000s, they all left, they've come back. Small developers have started, have left, come back. We've been really one of the few constants in the industry over the last 20 years, I thought John did a terrific job of laying out the moat we've drawn around our competitive advantages. There's no one who can do what we do. I think some of the things that were on the video, those are several dollars a megawatt hour of advantage, right? This is a business where quarters and $0.50 and dollars matter a lot in returns.
I'm as confident as ever in our competitive position. Our returns are where they've been historically, right? Our levered wind returns are over 20%, our levered solar returns are in the teens, and we feel terrific about the portfolio and feel like we have a huge competitive advantage over everybody else. Are going to continue to execute on our playbook and not worry too much about the folks out there. You've seen several folks over the last year, what I would call blow up. Right? Where they did a bunch of bad projects, and they couldn't get them financed. They sold out, they've exited. You've seen big oil companies say they're going to come back in. Holy cow, they used to be in. They were in it 20 years ago. They lost billions of dollars. Oh my God.
Some of the silliest capital destruction I've ever seen, honestly, in the renewable space. Yet they're talking about getting back in. You know what? We're just going to continue to execute on our strategy and continue to build on those competitive advantages and execute and do the right thing for our customers.
Thanks. Quick follow-up, if I can. You've laid out through 2022, again, in this day and age, so this is excellent. How do you think about the cash flow versus earnings trajectory of the company? I suppose, let me frame it this way. You've got clear confidence in your dividend growth as evidenced by your above earnings trajectory. How do you think about that as the tax credit starts to roll off? This is the underlying question.
Sure.
Especially with some of the amortizations also rolling off.
Right. Sure. Obviously we didn't lay out expectations post-2022. Right? We extended it to 2022, which there's not a lot of folks I think who have expectations out that far. Not only do we do a rolling five-year forecast every month, we spend a lot of time, spent a lot of time last year with John, this year with Rebecca, as crazy as that sounds, on a 10-year forecast. Right? We have terrific visibility into the business. We understand the growth visibility that we have in both businesses. I think one of the more exciting things that you saw laid out in both Eric and John's presentations today is we're really just getting started, right? In both businesses, right? In Eric's business, people have historically always said to me, "Well, aren't you done at FPL?" Gosh, we're just getting started, right?
With solar, with the T&D side of the business. We still have a ton of generation modernization to do. Just look at what we just did with Manatee. Right? In John's business-I am so excited about the future growth of renewables and the penetration of renewables in this country. We are playing in a market that's growing at 15% a year. There's no reason why we can't maintain and actually grow share profitably through that period of time. I feel really good about our long-term growth prospects too. We just didn't lay them out in numbers today because, gosh, you've got to leave us something to talk about next year and the year after.
Hi. Good afternoon. Thank you for taking my question. Maybe, if I may, just to follow up on the regulatory strategy around storm hardening in Florida. There's a filing out there right now where you propose the extension of your pilot and the certain capital in there, and then there's some numbers you put up on the deck right now. How is this all going to work together, especially as you move towards a position where you will have potentially a closed recovery, and is that going to roll into that, or how should we think about this?
Jeff, do you want to?
Sure. We have a storm hardening program that we've laid out, and that continues. This incremental program, assuming the governor signs it into law and it gets sent over to him, will provide us opportunities to look at other undergrounding, as we laid on the slide, that will be on top of the storm hardening that we're going through now. We have a variety of CapEx projects that we've been planning on for quite some time that goes to hardening like the 500 kV transmission line, as an example. This lateral undergrounding will take it to another level and give us an opportunity to prove out what we've been doing now for the last four years, and that's under a pilot program that was approved by the Commission.
We've had a number of undergrounding projects underway to look at how do we do this kind of at the residential level at a much more cost-efficient, cost-effective way. We've been able to prove that out, and now we can roll it out on a much larger scale. It will be, as Rebecca said, this is a multi-decade type of approach. We don't want to see any rate shock in customers' bills. We want to make sure that this is done in a manner that is stepwise and allows us to leverage the purchasing power as well as frankly, the ability to execute. We have 67,000 miles of distribution line in our system. About 40% of it is underground right now. There's a lot of work to be done. It's not something you do in a couple of years.
It's something you do over a very long period of time. What we'll be doing, if this legislation is signed into law, is the first thing we do is we have to bring a plan before the Commission that is, again, much like what we do on our 10-year site plan, a multi-year plan that would be approved, and then that would go into a clause recovery mechanism that we would then recover on an annual basis, going back before the Commission to review it and to renew the plan going forward.
That would be incremental to what you have now on the slides?
There'll be an incremental component to it, as well as in the storm hardening we're currently doing will go presumably into that clause as well. All the storm hardening that will go into the clause, whereas today, that storm hardening is part of our base rate proceedings when we're in front of the commission. It's approved, we execute it until we go back in. That part will go out of base rates and into clause recovery, and so it'll be a new mechanism to recover it that will be done on an annual basis.
Thank you. One quick other one, if I may. The transmission line is going to connect the Gulf territory with the FPL territory. First, which utility is it now sort of contemplated to be a part of? Second, as you think about that project, is this a good opportunity to think about combining those two also at the same time?
Can you repeat the question? I didn't understand part of it. Did you understand all of it?
Yeah. I think, are you asking which utility is-
Yeah, which utility-
Are we thinking about putting Gulf Power together with-
The transmission line that connects the two, which utility is it technically going to belong to right now, and is this a good opportunity to combine the two?
Oh.
Right now it belongs to Gulf Power.
Got it.
Thank you. Gordon, go ahead.
Hi. Mike Weinstein from Credit Suisse. Just to follow up on that last question. There's a lot of opportunity in undergrounding and also the 30 by 30 plan at FPL. That is additive to the current plan, how much more annual CapEx can you legitimately add and still keep customer rates in line to still keep the balance sheet from overheating? I'm just wondering, how much can we actually expect the capital plan to increase-
Yeah, I think-
As these things get approved?
I think what you saw us lay out today through 2022 is a pretty good estimate on our part of what we think the capital's going to be between solar and the hardening that we have in place. Remember, assuming the governor signs, the bill hasn't even been transmitted over to the governor yet, so he hasn't even had a chance to sign it. Assuming he signs it, there's a whole process to go through with the PSC. They have to set up some rules. We have to put a program in front of them. My expectation is the rules aren't going to be really finalized until sometime next year, and then you're going to have a hearing around what to do. Remember, we are in the pilot stage right now of figuring out the best way to do undergrounding on our distribution system.
We have a lot of solar in the plan through 2022. You should think about all of those things as Julian's asking about what's going to drive the growth after 2022. Those are two great examples of things that are going to be terrific drivers of growth post-2022. Terrific for FPL customers. Improving resiliency, lowering fuel costs on the part of solar, but also I think will be good for shareholders as well as we continue that growth post-2022.
Yeah. The only thing I would add is, you've got a slide there that gives you visibility through 2022, what we actually expect to be able to deploy. Remember, part of the deploying of the money for capital, smart capital is ways that we're going to continue to be able to take costs out of the business. From a bill pressure standpoint, that's how you take pressure off of the bill. If you just spend the money and don't reduce your expenses, the bills go up. What we're really focused on is taking and continuing to take the costs on. If you remember on that O&M chart, we've reduced between 16%-18%, like 10% of our O&M, non-fuel O&M per megawatt hour even further. We're going to continue to do that by deploying those technologies that I showed, like in the video.
Those technologies change the way that you actually can run the business. I think you really need to understand that there is a real opportunity to run the business differently. When we have smart technology, like the drones as an example, using the data that we're getting and the recognition software, we don't have to roll a truck. When we do roll a truck, we roll a truck with a different complement of people on it, less people, less frequently. All that takes cost out of the business and how you actually run it. All of these things that we're doing, and sometimes it's little bit slices here and there, but when you've got a business that's 74,000 miles of transmission distribution line that covers 27,000 square miles, when you're not rolling trucks on a regular basis, that starts saving real dollars, millions here, millions there.
Before you know it's real money. That's what keeps the bills pressure low.
Jim, Eric, the regulatory environment in Florida, it has been and continues to look pretty balanced, there's this ballot initiative that is being proposed to deregulate, for the life of me, I don't understand how there could be an economic benefit for customers, yet it has proceeded most of the, from what I've read is the legislature, the commission sort of understand this is bad policy, I see that there's some legal proceedings that are progressing to try to figure out how to prevent this from getting on the ballot. Can you talk about what's going on there, how you think that's going to play out, and if it for some reason did get on the ballot, how you would educate your customers as to the benefits of not voting for that?
Sure. Think about it this way. Obviously, we think it's terrible energy policy. You just need to look at our bills compared to other states that have deregulated in terms of how much lower FPL's bills are than those states to know that, as you said, it would be very bad energy policy. I think you saw there is the Supreme Court has to rule on whether the ballot language is even constitutional, right? That's kind of the first step. There were, I think 18 groups who filed in opposition to the ballot initiative with the Supreme Court. Obviously, you'd expect the IOUs to file in opposition, hospitals, sheriffs, little cities, big cities, the House, the Senate, the Public Service Commission, environmental groups. There was a host of pretty much the entire economy came out-
The attorney general.
Attorney general. Thank you.
The attorney general. Pretty much the entire economy came out against it. We think the initiative is deeply flawed by the standard by which it needs to be adjudicated by the Supreme Court. Those are all arguments are at the end of August. They'll make a decision at some point after that. We feel very good about our case with the Supreme Court. Leave that aside for a moment. Separately, the ballot sponsors actually have to go and get 770,000 signatures verified by February 1st of next year. They're at, as of this week, about 310,000. They've been at it for eight months, and they've verified less than half of the signatures they need. There's not eight months left for them to gather the rest.
On top of that, appropriately, the governor just signed HB 5, which was a bill that puts into place some regulations around how these ballot signatures are actually gathered. We'll see what that means for the signature-gathering effort going forward. If you believe the ballot gatherers who all came out against that legislation, it's going to make it extremely difficult for them to continue to gather enough signatures to get there. Not only does it have to get through the Supreme Court hurdle, it has to get through the hurdle of getting enough signatures. Finally, let's say both of those things happen, and I think, the odds of both of those happening are extremely low. We have a great story to tell.
We won't be afraid to tell it, and you can be sure we will tell it, and if it was ever on the ballot, we will win. We spend a lot of time on it because we think it's really terrible energy policy for the state. It would reverse what has been an amazing. You just look at the FPL story over the last 30 years. It's an amazing story. There's not a story like it in the rest of the country. To think that some policy would be put in place that would unwind that really doesn't make any sense, and I think in the end, common sense would prevail. I don't know, Eric, if you have anything you want to add to that.
Yes. A couple of things just to add. First off, it's important to recognize that anybody can start a ballot initiative, just like anybody can file a lawsuit. Okay? This is just the way, unfortunately, the world is working now in a lot of areas. The governor signed this legislation, not because of this, but because the last election cycle, there were 12 ballot initiatives that got put on the constitutional ballot, of which all but one passed. The one actually would've reduced tax burden for folks, but they didn't understand it. They passed stuff like no vaping in the public, along with no offshore drilling. That was one vote you had to cast, right? It's gotten a little bit nutty of trying to legislate through constitutional ballots. Anybody can do this. It's going through the process, as Jim said.
The Supreme Court has to review it based on some very specific legal tests, which not only we, but every one of those groups Jim laid out, filed briefs on saying they fail the tests on multiple fronts. Okay? The legal test. It's not a review of the benefits or costs associated with deregulation. Supreme Court doesn't look at the merits. It's looking at does it meet certain legal tests. We think it fails there. All right. Back to Jim's point, by the way, the court is also very different than it was two years ago. Governor DeSantis has appointed three different Supreme Court justices. Now, his big litmus test was not having justices that adjudicate from the bench from the standpoint of trying to pass legislation from the bench, right? Strict constructionist type approach. We'll see what happens on that.
As Jim said, we're very prepared if we have to be able to argue our case to the voters. Remember, the voters, or half of the voters are our customers. We have the lowest bills in the state and have among the lowest in the country for years on end. Our reliability continues to be among the best in the country. Our customer satisfaction is in the mid 90s to 96%, depending on whether it's business or residential. Any politician would love to have customer sat ratings like that. We'll tell our story, I think, to a relatively receptive audience. I think the real Achilles heel of this particular amendment is the fact that it would actually ban any current investor-owned utility from being able to have generation or even own distribution or transmission.
I think our customers, based on our customer satisfaction, like us being in the business. I'll take that one to the voters if needed, I don't think we're going to get there.
Why don't we, Michael is in the middle there. Michael, please. We'll get there. I promise you, we're going to get to everyone's questions.
Hey, guys. Thank you for taking my questions. I had 2, one very easy one and one kind of thinking about the environment. First, the easy one. Does your plan assume at the NEE level, either no equity or no convertible securities issued up there, or does it assume there's some? That's kind of fun because y'all have made very opportunistic uses of the convertible market over the years. The other question is, when you're looking at the environment for M&A for regulated companies today versus what it was like 2 or 3 years ago, 3 or 4 years ago, given where equity valuations are, where financing is, where your balance sheet is the environment more attractive, less attractive, and if so, why?
On the first one, obviously, we always are going to use We've always had a toolkit of financing that we've made ourselves available of. A lot of it is going to be driven by how successful we are against the ranges that we laid out here, right? If we meet or beat some of the capital ranges that we laid out, we've added a ton of capital at FPL that obviously has used, until we go through the rate case for 2022 rates, that uses some balance sheet capacity. It's going to be driven by how successful we are on the stuff we do. Now, we won't do anything that isn't accretive, right? Our goal is always not to issue equity, and that's always our goal. You know that's my goal.
If we have to, it'll only be because that we have these great opportunities that I'll be excited about and we'll be chasing after. On the M&A front, is it a better or It's always been, for 20 years, it's been a tough environment for M&A. It's a lot of challenges. Mark can tell you, when you look at it and you assume you pay a premium, and then you assume there's give back to customers, and that math rarely works, even when you're doing the things that Marlene laid out to improve the underlying operations, right? I would tell you that it's about the same. We'll continue to be opportunistic and only go after things that we think make sense.
Hi. Steve Fleishman at Wolfe. Just first on tax credits for renewables, what's your either thoughts or even position on PTC or ITC extension that's starting to be talked about again, and also potential for a storage ITC or safe harbor extension? Any of those things that we should be watching for?
On PTC, ITC, I think it is very low odds of any change there. Listen, we supported the phase down. John laid out, we think the economics post-credits are going to be very competitive. There obviously have been some efforts in the House to try to extend things. I think those are low odds in the near term. On the storage front, never say never there. There is a chance that something like that could happen. Like anything in Washington, I would not put it at much above 20% if I was an odds maker. Fundamentally, the industry is moving past the need for credits.
Safe harbor, any chance that gets extended beyond four years?
Maybe, again, I wouldn't hold my breath, Steve.
One other just high-level question on, if you look at a lot of the folks who are really supportive of renewables, environmentalists, a lot of them have also become anti-gas.
You are obviously doing both and continue to grow your gas business. Just how are you thinking about natural gas in the context of everything else that you're doing?
The thing that mystifies me, for example, the opposition to the East Coast pipelines, MVP and ACP, the piece of it that mystifies me, and this is coming from the largest owner of renewables in the world, right? The thing that mystifies me is that these pipelines are enabling shutting coal plants down. Right? Enabling 30, 40, 50% reductions in those states of CO2 emissions. It is a complete head scratcher for me. Natural gas is going to be an important part of the equation for a long time. This country has literally hundreds and hundreds of years of natural gas. Remember, think about this, there's still a ton of fuel oil that's burned in the Northeast that can be replaced by natural gas. That would be a huge CO2 improvement. You still need natural gas for heating in a lot of places.
The opposition to it honestly mystifies me. I guess folks want to be cold in the winter and burn a lot of coal. I think it is really misguided, but it's real. It's real. Hopefully we're going to be able to start to have a more rational discussion about energy policy in this country, right? Energy policy has been very polarizing. The left loves offshore wind, the right loves new nuclear. The environmentalists hate gas. What we need is to decarbonize and to bring low-cost solutions to customers, right? That includes renewables and storage and natural gas. We'll decarbonize, and it'll be better than free. We'll be lowering customers' bills.
Thanks. Paul Fremont with Mizuho. Can you give us an update on sort of the balance sheet capacity for acquisitions, I guess, which you've talked about in the past? Does the very high multiple paid for El Paso recently, or offered for El Paso, does that make you sort of less confident that you would engage in an acquisition? Is there any update that you can provide on where things stand with Santee Cooper?
Sure. I will talk about one of those. I'm going to let Mark talk about Santee Cooper. I'll let Rebecca talk about balance sheet capacity. In terms of the multiple that was paid for El Paso, listen, anytime there's an auction, right, it's very hard in this space to figure out a way to create value in an M&A scenario, right? Like I said, we're going to be opportunistic, and we're going to be disciplined. It makes me no more or less bullish than I've always been, which is, I think we have found opportunities in complex situations where we can move quickly. In a $1 billion regulated utility acquisition, there's 1,000 infrastructure funds that would love to stroke a $1 billion check right now. There's not a lot of folks, though, who have the ability to do what we did, for example, in Gulf, right?
It's going to be very situation dependent. Mark, you want to talk about Santee?
Sure. Over the course of the last month, there was legislation passed that basically authorizes the South Carolina Department of Administration, which is within the governor's office in South Carolina, to hire financial and legal advisors
With the goal of running a process to select one party who submits the best proposal to purchase Santee Cooper, one party who submits the best proposal for a management contract, and it also allows Santee Cooper to put forward a reform proposal. The South Carolina Department of Administration currently has an RFP seeking to hire financial and legal advisors. There's language in the legislation which effectively conflicts out a lot of financial advisors just because of the fact that it basically says that they can't have relationships with the participants. It's probably going to take over the course of the month of July for them to get the financial and legal advisors in place, and for those financial and legal advisors to come up to speed to the point where they can run a process.
We're talking about a process that will probably take place in earnest in the August to December timeframe. The South Carolina Department of Administration basically has until the first quarter of next year, maybe toward the end of the first quarter of next year, to make a recommendation on a sale, a management contract, and the Santee reform. From that point, it'll be up to the legislature as to what they choose to do during legislative session next year.
From a balance sheet perspective, as I talked about and Jim talked about at the outset of this discussion this morning, we remain unyieldingly, unflinchingly committed to having a strong balance sheet, which generally means there's capacity there. We aren't running it close to the very edge. It's specifically in order to be able to take advantage of the types of opportunities that we talked about, what we've executed on, whether it was Gulf Power or investing incremental capital at Florida Power & Light Company that we talked about earlier this year, or some of the opportunities that we might have in the marketplace. We'll continue to operate the way that we've been operating.
Okay. All right, Andy.
Just a couple quick questions. Just on the undergrounding, how many-year opportunity is that? I guess you can only do a certain amount every year to cover probably gas pipeline replacement. I'm just curious how many years out you have this-
We don't have it specifically, but you're talking about 25, 30 years, right, to do this in a manner that would be kind of a stepwise approach. We'll be reviewing that with the Commission. As we get into this, I fully expect that we're going to see incremental savings as you get into a programmatic way to do this. Costs will come down on it. Now, I'm speaking generally. There's certain areas, like really urban areas, that'll be more expensive than rural areas. We'll have to take a look at all of that. It's a multi-decade approach.
Okay. On the PTC, are you maybe better off without it being extended longer term just because you have such a competitive advantage over everyone else, or is that a wrong way to look at it?
Yeah. One way to think about it, Andy, is that a lot of our smaller competitors raise capital through tax equity financing to be able to be competitive and win. It's going to put more financing constraints on smaller competitors as they move forward, as we're able to push the cost advantage as we get into 2021, 2022, and beyond. I think that's really what leverages our playbook. I think it's going to be more difficult for them to really make up that ground. On the financing side, the ability to raise capital efficiently, that's another competitive advantage we have on the borrowing cost side. I think it plays a bit to our advantage.
Just two more questions. Just on the kind of 8% growth rate. Well, 6%-8%, whatever. We'll call it eight. What gets you, just on an annual basis, not each year, but on an annual basis, how do you grow above 8 in one year? What would do it for you? I assume there's that opportunity at times.
I think what we best do, Andy, is deliver very steady, predictable growth to our investors. In any given year, there's always things that are going to have you be above or below that. The goal is always to be pretty much steady, as the team knows. I would think about that as our ability to continue to deliver pretty steady and predictable 8% a year growth off our base, including 8.
I got you to say eight. There you go. My last question is just on the dividend growth rate, could you just clarify that and what we should be expecting? It's been 12%-14% for the last several years.
Yeah. It's a board decision, Andy. We're going to talk to the board about it, and as I said, we're going to keep some news held back. We'll have some news on that in the first quarter of next year.
All right. Go ahead, Abe.
Thanks. Abe Azar with Deutsche Bank. Obviously, there are huge benefits for Gulf connecting into the FPL system and potentially merging with FPL. What are the benefits to FPL customers from doing those kind of things?
Again, we haven't made any decisions doing it. We're just now getting into looking at what are the advantages going to be. There's always advantage if you can add customers and have scale. An additional scale brings them the opportunity. You spread the cost over more customers. FPL customers would benefit from that as well. There are areas where Gulf has done a good job too. We always continue to learn from their experiences. We're going to take a look at all the puts and takes on this and make sure that whatever we do is going to be, first off, in the best interest of making sure all customers, FPL and Gulf customers, there's a benefit that we can articulate in front of the commission, make sure they're comfortable with it. It's not just short term, but also long term.
Okay.
Here's an example of that. Once the line is built, it's very possible that solar in Gulf territory, in my territory, is very valuable because it is time shifted from where most of the load is, right?
Gulf is in the Central Time Zone.
Right. Gulf's in Central Time Zone, you will be able to deliver solar at that last hour when the sun is setting, but it hasn't set yet where Gulf is. That's very valuable, actually. Power's going to flow both ways on that one. This could be a big benefit for FPL as well, as we look at it, I think.
On NEP, the wind repowering, how much investment does NEP expect to spend there, and what's the financing plan for that?
Want to talk about that? The investment between the two is probably a couple hundred million, Rebecca?
Yeah.
In total, right?
117.
We will finance it kind of in the normal course of how we finance NEP through the year. There's going to be a big piece that's going to come from tax equity, and there'll be another piece that will come from kind of the general way we finance NEP on a going forward basis. We have certainly the room in the financial plan to do it.
Yeah, we had on the page that we were going to raise PAYG tax equity in the context of that financing. There's some existing project finance that is on those two projects, and we're going to use the proceeds to pay down that project finance, the tax equity proceeds.
I think we have time for one more question.
Okay. I guess that well we're not going to take anymore questions. All right. Who has a question? The person in the back has had his hand up the longest, I think.
It's Paul Patterson at Glenrock. How you doing? Just on NEP, I've been looking at the SEC filings and what have you, it is quite complicated. I was just wondering if you could maybe provide us an idea about what the CAFD outlook would be without any acquisitions, without the PG&E fluctuation. Just sort of an organic sort of outlook as to what the ongoing cash flow would be over, I don't know, four or five years or something like that. Given the way the CAFD works, the way the financing works, it's not easy, at least for me, to project what the ongoing cash flow would be just organically. What you guys did with slide 200 on NextEra, that kind of an idea over sort of a multi-year situation with NEP.
I was just wondering if you guys could give us a little bit more flavor about what that would look like.
Supply and trading
the supply and trading business. What's driving that, just in general? Is that just an outgrowth of having more business, more portfolio to work around, or is there something else that you're doing there?
Paul, to answer your last question, yes, it's just a normal course. We've continued to grow that business kind of in line with how John's business has grown over the last 15 years. In terms of NEP, how I answer that is, look at the run rate. We gave the run rate cash flow, both EBITDA and cash flow for the portfolio as of the end of last year. And we've given a view of what the run rate EBITDA and CAFD are.
End of year-end 2019.
At year-end 2019
both with or without PG&E.
I think that, and we've given a very clear walk, too, in the appendix of all the quarterly things.
Just as a follow-up, both of you have, because the financings, which are somewhat complicated and creative and interesting, the way they work, a substantial amount of the cash impact, which you guys went through, is sort of a near-term element of it. Longer-term, it wasn't really completely clear about what the cash flow impact would be because of that. I could talk to you guys offline about it if it's to get into that. If you follow what I'm saying.
I would just say that, as I talked about in my prepared remarks, that the transaction that we did earlier this year well positions us to achieve our 2019 run rate guidance. We also had the slide that spoke about to the extent we execute on the organic growth opportunity at the natural gas pipeline and the wind repowering, along with freeing up the trapped cash at NEP. You can see we talked about that being another year and a half. You can logically get to somewhere in the middle of 2021 just based on that embedded growth. There's all the things we talked about in terms of operation improvements we're going to make and the like. At least, I know that doesn't get you all the way to 2024, but it gets you pretty far there just through those opportunities.
Terrific. Thank you guys very much. Again, we appreciate all of your time and attention, and thank you for joining us today.