May 14, 2004                                                                         Volume #1  Number #1

We have met with the Company on two occasions to hear presentations by business unit leaders. These presentations are very general in nature and are being presented as an overview by the Business Unit Leaders with respect to performance and plans for the future with no specific proposals or recommendations submitted by the Company. We were scheduled to meet with the Nuclear Business Unit for the final presentation yesterday which we had hoped to include in this newsletter; however, the presentation was cancelled by the Company and has not been rescheduled at this time. The following is an overview of the general information provided:

Both the Company and Union Negotiating Committees met with the Power Systems Business Unit on May 4, 2004. The presentation was focused on three areas, Customers, Shareholders and Employees.

Distribution explained that in the area of customers, they were performing in the top quartile in reliability when compared to other utilities, with a goal of sustaining their performance by enhanced and proactive communications with customers to make sure they are meeting their needs and achieving customer satisfaction. It was also reported that they were experiencing increased growth in new customer accounts which totaled 107,000 for a 12 month period ending in March of 2004 compared to 100,000 for the same time period last year.

In the area of Shareholder value, they discussed providing a better return for shareholders by reducing cost in providing service. To accomplish this they want to improve productivity and technology. It was also reported that last year, construction man hours (CMH) improved by 43% over the previous year, but the overall cost of providing the service was steadily rising. To offset or bring down the cost they will be looking for best buys with venders in both goods and services and adding customers with out adding cost.

In the last area of Employees, the company discussed the enormous gains made in safety along with the 40% reduction in injuries in the first quarter of 2004 compared to last year and the need to focus on further improvements such as enhanced tailboards, hazard assessments, compliance with safety rules and peer to peer observations. The key initiatives expressed by the company was to manage attrition by hiring the right personnel, providing opportunities and improved training, improving the apprentice programs, leadership development and emergency storm process improvements.

Power Delivery stated that transmission outage times are at a record low of 4 minutes and they are experiencing fewer frequencies and momentary interruptions than ever before. They went on to say that they shared a lot of the same issues and concerns as Distribution with an additional issue concerning the difficulty in obtaining clearances as outage windows shrink in the spring and fall due to power plant outage schedules and system load. To address this issue they are looking for some flexibility in work schedules to maintain generation reliability for the customers.

The Committees met with the Power Generation Business Unit on May 6 2004. The Company discussed the future units at the Martin, Manatee and Turkey Point locations, being the best in class in safety for the year 2003, being best in class for the last five years with their Equivalent Forced Outage Rate (EFOR), being best in class four of the past five years with their Equivalent Availability Factor (EAF) and being able to significantly reduce cost within the Business Unit since 2001. Challenges identified by PGD included maximizing asset value while keeping plants available and reliable through risk management systems, long term outage planning processes, staffing to the mean instead of the peaks, enhancing Central Maintenance’s efficiency and costs while meeting the customers needs and being environmentally safe while being the low cost provider.

In addition to the business unit presentations, both the Union and Company have agreed to conduct a series of informal pre-negotiation meetings to discuss medical issues. In our first meeting the company discussed the continued rising cost of prescription drugs and medical coverage. The cost for medical last year was $110 million dollars for FPL Group, which included $20.8 million dollars for the bargaining unit plan. According to FPL figures, approximately seventy-five percent of the bargaining unit claims were a result of direct medical cost, twenty-five percent was a result of prescription drug costs which rose fourteen percent in 2003 alone.

At this time, the medical reserve balances and reserve ratios have stabilized which indicates the projections by the Actuaries in the last two years were accurate. However the issue for all of us within the industry is the continued rise in medical costs each year and what to do about it. At the conclusion of the presentation the Union requested and is waiting on a great deal of information from the Company which is being collected for analysis and further discussion with our Actuary. The next scheduled meeting to discuss medical will be on May 18, 2004 followed by additional meetings every Tuesday and Thursday until the end of May.

As far as negotiations, no official date has been set for formal negotiations as at this time, although preliminary discussions have revolved around the June time frame. The Union has been busy with requests for information and writing proposals into contract language form which are in final draft and researching those proposals using International Office information, other Local Union Contract information, industry trends, assistance from Actuaries, and International Representatives. Once we formally exchange proposals with the Company, copies of the final proposal will be forwarded to each Local Union.

Negotiation News Bulletins will be released as we gain new information and at least weekly after we begin formal negotiations.