The ratings for FPL Group Inc. and its affiliates incorporate a stable, regulated utility located in the growing Florida markets, increasing business risk due to the growing merchant energy portfolio, adequate credit protection measures coupled with high leverage relative to financial benchmarks, and significant capital needs. Concerns include the company's ability to secure construction financing for a portion of its merchant portfolio, the ability to meet forecasts that are more robust than the company's historic performance, and nonregulated subsidiary FPL Group Capital Inc.'s exposure to market risk because it is bringing merchant plants on line in a depressed market. Juno Beach, Fla.-based FPL Group has about $6.8 billion in outstanding debt. Subsidiaries include Florida Power&Light Co. (FPL) and
