INTERVIEW-FPL sees renewables soon competitive with coal

By Timothy Gardner

NEW YORK, Sept 26 (Reuters) - Power generation from low-carbon energy sources like wind, solar and nuclear should soon become competitive with electricity generated by coal, the cheapest of fossil fuels, the chief executive of FPL Group Inc. (FPL.N) said on Wednesday.

FPL said on Wednesday it will spend $1.5 billion aimed at building solar thermal energy in Florida, California or other states. It is part of a larger $2.4 program aimed at cutting emissions of greenhouse gas carbon dioxide, including a more efficient power network.

The company is already the largest U.S. wind power producer.

The United States has hundreds of years' worth of coal supplies, which helps make power generated from the black rock cheaper than the relatively new power sources of wind and solar. And building a new nuclear power plant now can cost billions more than building a new coal-fired station.

"The thing we've got to make customers understand is that any fossil fuel has a hidden cost that society is paying every day, and that is the cost of carbon," Lew Hay, FPL's chief executive, told Reuters in an interview on the sidelines of the Clinton Global Initiative, a philanthropic summit organized by former U.S President Bill Clinton.

"We need to put a price on carbon, by doing so the illusion that coal-produced energy is low-cost will go away."

U.S. President George W. Bush has opposed limits on greenhouse gases like carbon dioxide, saying they would hurt the economy. But presidential candidates from both major parties in next year's election support cutting emissions of the gases that would, in effect, make power companies pay to pollute, and U.S. Congress is studying bills that would do the same.

Hay said FPL will build at least 300 megawatts of solar thermal in Florida, which will help the state reach new goals on renewables outlined by Republican Gov. Charlie Crist. Unlike photovoltaic rooftop solar energy that converts sunlight into power, solar thermal generates electricity by converting solar energy to heat to drive a thermal power plant. The other 200 MW will be built in California or other states.