A years-old Florida political scandal has resurfaced in a disclosure fight hundreds of miles away in Virginia, where regulators are reviewing NextEra Energy’s proposed, and controversial, acquisition of the Commonwealth’s dominant electric utility company, Dominion Energy. 

The acquisition would create the largest regulated electric company on the planet, but it has drawn opposition from some of Virginia’s most powerful officials, including Gov. Abigail Spanberger, who has expressed concerns about past controversies that to this day hang over NextEra’s largest subsidiary, Florida Power & Light.

At the center of the disclosure dispute is a confidential document known as the “Robo Memo,” which details efforts to influence Florida elections, public officials and media coverage, much of which was orchestrated by former political consultants working for Florida Power & Light. Reporters at several newspapers in Florida, including the Orlando Sentinel, The Florida Times-Union, and the Miami Herald, obtained a heavily redacted version of the memo years ago, which served as the basis for several stories about various controversies swirling around the utility company.

But the full document has never been made public. A Virginia hearing examiner this month ordered NextEra to  produce the full memo to a limited group of third parties, though it remains subject to a protective order that tightly restricts access.

Now, Virginia’s governor is calling for that access to extend to the public. 

On Tuesday, Spanberger called for her state’s regulators to release the Robo memo. “I think that is essential for the ability of everyday Virginians who might be attuned and paying attention to and deeply concerned about this potential merger… they should have the ability to review it. It should be in the public sphere,” she said.

Utility watchdogs who have followed coverage around FPL’s Florida political scandals believe the full, unredacted document has enormous public value and should be broadly released for anyone to see. 

“Florida Power & Light and NextEra have been embroiled in scandal for the better part of the last decade,” said Daniel Tait, the research and communications director for the Energy & Policy Institute, which has been critical of FPL and NextEra.

“Most of that scandal was first exposed by intrepid reporters combing through the Robo Memo, the very memo NextEra is still hiding years later … Releasing the memo un-redacted and in full, should be a prerequisite for every Virginia regulator and lawmaker.” 

NextEra Energy and Dominion Energy did not respond to requests for comment prior to publication, though the companies have previously told regulators the memo contains unsubstantiated allegations that concern a group of mostly former corporate executives. They’ve also questioned the relevance to NextEra’s bid to absorb Dominion.

The proposed $67 billion merger would combine NextEra with Dominion Energy, whose Virginia electric utility serves approximately 2.7 million customers. NextEra shareholders would own roughly 74.5% of the combined company, which would operate under the NextEra name while retaining Dominion’s local utility operations and regulatory oversight.

The Virginia State Corporation Commission is reviewing the proposed acquisition to determine whether it satisfies state requirements intended to protect customers and ensure continued reliable utility service.

In news releases, the companies have promoted the merger as a way to reduce costs, improve reliability and expand energy infrastructure. In September, they announced an expanded package of proposed benefits for Virginia, including $10 monthly residential bill credits for four years, an additional $100 million in low-income energy assistance and commitments to preserve existing Virginia employment levels for five years. 

They also pledged to protect customers from merger-related costs and maintain Dominion Energy Virginia’s local leadership and oversight by state regulators.

Spanberger’s office, in testimony to regulators, recommended they take heed of the memo, drawing heavily on past reporting and shareholder litigation, noting that the protective order suppressing its release banned her office from “directly referencing it in this testimony.”

“The Commission should examine the Robo Memo produced in discovery and ensure that appropriate commitments are obtained from the (electric companies) to ensure that similar conduct cannot take place in Virginia,” her office said.

A secret memo and disclosure dispute

Earlier this month, a Virginia State Corporation Commission hearing examiner ordered the utilities to produce the Robo Memo to participants in the merger proceeding, finding it relevant to questions about how NextEra’s board of directors handled allegations of misconduct.

But the examiner then allowed the companies to tightly restrict how the document could be reviewed and by whom.

That ruling followed a motion by Clean Virginia, a nonprofit advocacy group that has challenged the political influence of electric utilities, and the Piedmont Environmental Council. The organizations argued that NextEra’s conduct in Florida was relevant to assessing the company’s fitness to assume control of Dominion’s Virginia operations.

But the ruling did not settle whether the document — whose name refers to former NextEra CEO James “Jim” Robo to whom the document was reportedly sent — would ever become public.

NextEra and Dominion subsequently sought to limit access to the memo, arguing that it contained disputed allegations about individuals and confidential information that could cause harm if publicly disclosed.

In an Oct. 8 ruling, Chief Hearing Examiner D. Mathias Roussy Jr. approved an arrangement allowing certain participants who have signed confidentiality agreements to inspect the memo in person only at the utilities’ attorneys’ offices rather than receive copies electronically. The ruling also directed the companies to provide copies to commission officials and make the memo available for inspection without delay.

Clean Virginia opposed those restrictions, arguing that requiring attorneys and experts to travel to review the document without retaining copies or taking notes would hinder their ability to prepare testimony. The nonprofit sought the Robo Memo as part of a broader set of discovery requests examining NextEra’s political activities and corporate governance, according to filings.

The political operation in Florida

The Robo Memo’s significance extends beyond the document itself, though, and is tied to years of allegations surrounding FPL’s relationships with political consultants, election spending and efforts to influence public officials in Florida.

The memo describes activities undertaken around Florida by former employees of Alabama-based political consulting firm Matrix LLC on behalf of FPL.

Among the controversies are Florida’s so-called ghost-candidate scandals, in which those former Matrix operatives  stood up dummy campaigns in an effort to siphon votes away from Democratic candidates. One of those Democrats, Jose Javier Rodriguez, whom FPL executives despised, narrowly lost his 2020 re-election to the Florida Senate in a race that included one such ghost candidate who shared Rodriguez’s last name. 

Jose Javier Rodriguez is now running for Florida Attorney General.

The memo also laid out an effort to convince Garrett Dennis, a Democratic member of the Jacksonville City Council, to step down and take a lucrative job at a 501(c)4 organization controlled by those same political operatives. Dennis was one of the council’s most vocal opponents of an effort, then ongoing, to privatize Jacksonville’s city-owned electric water and sewer utility – for which NextEra bid $11 billion. 

That sale effort collapsed amid public opposition and questions about the conduct of utility executives and city officials.

Other allegations involved payments or relationships intended to influence media coverage of FPL and its critics.

NextEra has never been accused of wrongdoing by law enforcement, even as more peripheral figures were prosecuted and convicted for their roles surrounding the sham candidate in South Florida who helped defeat Rodriguez, and the Jacksonville privatization effort, which was beset by numerous controversies that did not involve FPL.

NextEra has said its internal investigation found no evidence of wrongdoing and that the existence of allegations in a confidential memo does not establish that the company or its executives committed misconduct. And Matrix, for its part, has long distanced itself from the activities laid out in the Robo memo. Joe Perkins, the firm’s owner, accused Matrix’s former CEO of performing millions in off-the-books work for FPL without his knowledge. 

The companies have maintained that confidentiality restrictions are necessary to protect sensitive information contained in the document, claiming public disclosure of the memo’s allegations or any details of them “would cause … irreparable harm.”

“The Robo Memorandum,” one of the motions claimed, “is a compilation of multiple layers of hearsay allegations concerning numerous private individuals, including employees of Matrix, NextEra, and other third parties.”

The price of a monopoly

Dominion Energy, whose Virginia electric utility serves approximately 2.7 million customers, has long been a major political donor and lobbying presence in the commonwealth. That influence – much like that of its Florida counterpart – has been the subject of debate for years. 

The company’s financial contributions to candidates and political organizations have drawn criticism from advocacy groups such as Clean Virginia, which argues that allowing regulated utilities to contribute to the lawmakers responsible for overseeing them creates a conflict of interest.

Dominion has contributed to candidates and political organizations while advocating for legislation affecting utility regulation, infrastructure development and electricity rates. The company’s political spending reached millions of dollars in recent election cycles, notably contributing about $7 million to political campaigns during Virginia’s 2022-23 election cycle, according to campaign finance records reported by the Virginia Mercury.

The spending has drawn criticism because electric utilities operate differently from most businesses. Regulated electric utilities operate uniquely within designated service territories where customers generally cannot choose a competing provider for electric distribution service.

In exchange for that monopoly position, utilities are subject to government oversight of their rates, investments and service obligations. The arrangement is intended to allow utilities to recover prudent costs and earn a regulated return while protecting customers from unreasonable charges.

In Virginia, the State Corporation Commission reviews utility rates and earnings, but state lawmakers establish the laws governing that oversight. Those laws can determine how much money utilities are permitted to collect from customers and retain as profits.

But the system becomes vulnerable when utilities use their political influence to shape the rules governing their own profitability, according to utility watchdogs.

A history of regulatory pushback

Virginia is not the first state where NextEra’s acquisition ambitions have prompted questions about how much control a parent company should exercise over a regulated utility. Regulators in Hawaii and Texas rejected earlier deals after finding that proposed arrangements did not adequately protect local customers and utility governance.

The Hawaii Public Utilities Commission found that the applicants had failed to demonstrate the transaction was reasonable and in the public interest in 2016 after examining the proposed benefits to customers, risks associated with NextEra’s corporate structure, commitments to clean energy, local governance and the effects on competition.

A year later, NextEra’s effort to acquire Texas utility Oncor also failed to obtain regulatory approval.

Texas regulators raised concerns about protections intended to preserve Oncor’s independence and shield the regulated utility from financial risks associated with its prospective parent company.

And a few years later, NextEra’s expansion plans intersected with Jacksonville, where its interest in acquiring JEA became part of a controversial sale process that ultimately collapsed in 2019.

The Virginia State Corporation Commission’s decision will determine whether NextEra can proceed with a multibillion-dollar merger that would bring Dominion’s Virginia utility under its corporate umbrella. But its implications could extend well beyond Virginia, including to Florida, where allegations involving NextEra’s largest subsidiary have already generated years of investigations, litigation and public controversy.

FPL operates under the oversight of the Florida Public Service Commission, which regulates investor-owned utilities’ rates and service. 

While Virginia regulators cannot directly set FPL’s rates or impose penalties for alleged misconduct in Florida through the merger proceeding, they can examine whether NextEra’s management practices and corporate governance provide sufficient protections for Virginia customers under the proposed ownership structure.

The Virginia case also has created another avenue for examining how NextEra’s leadership handled allegations of political interference in Florida, where the controversies surrounding FPL have already carried financial and reputational consequences.

In June, shareholders in a securities class-action lawsuit proposed a $150 million settlement over claims that NextEra misled investors about alleged political misconduct, though U.S. District Judge Aileen Cannon denied preliminary approval of the settlement earlier this year. 

Alexandria Mansfield is a freelance reporter based in Jacksonville.