Ditching Duke could lower Clearwater electric bills, study finds
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Electrical line trucks at Duke Energy's staging area prior to 2023's Hurricane Idalia. Photo: Stephen M. Dowell/Orlando Sentinel/Tribune News Service via Getty Images
Ditching Duke Energy for a city-run electric utility could save Clearwater residents millions of dollars, according to a new study.
Why it matters: Facing higher electric bills and hotter summers, many Floridians are desperate for a break.
- "The elderly people in my community, they struggle to pay their electric bill," Mayor Bruce Rector told the Tampa Bay Times on Thursday.
- "If I can find a way to offer them lower rates, how do I not consider that?"
What they did: Clearwater City Council members voted last August to pay consulting firm NewGen Strategies & Solutions up to $504,000 to study what it would look like if the city took over electric service.
- The city's 30-year contract with Duke expires in December.
What they found: Under a city-run utility, residents would save an average of 7% annually for the first five years and 18% per year for the following 25 years, NewGen found.
- The move wouldn't be without risks for the city, the consultants note, but the study takes into consideration the costs of acquiring equipment from Duke and the legal fight it could take to do so.
- Duke Energy Florida president Melissa Seixas told council members last year that Duke's equipment isn't for sale and that the city would have to acquire it through the "lengthy, expensive and very complicated" process of eminent domain.
The other side: "We look forward to working with the city on the best path forward, which we believe is renewing the franchise agreement," Duke spokesperson Ana Gibbs said in a statement to Axios.
- The statement also pointed to a line in the study that says "there can be no guarantee" that a city-run utility "will achieve cost savings compared to continued service from Duke," noting that the findings are based on estimates and projections.
- "The bottom line is that creating a city power company would be enormously expensive, risky and take years," Gibbs said.
Flashback: In May, Duke released its own study, which determined it would cost the city more than $1 billion to take over Duke's equipment, the Times previously reported.
- That study, conducted by consulting firm Concentric Energy Advisors, didn't include a rate comparison.
- Concentric has been hired by investor-owned utility companies across the country to conduct such studies, which often land at similar findings, the Times found.
Zoom out: NewGen's study could have an impact beyond Clearwater.
- Last month, St. Petersburg City Council members directed Mayor Ken Welch to seek proposals from consultants who could conduct a similar analysis.
- St. Pete's contract with Duke is up next year.
What they're saying: "It's encouraging to see an impartial study show the same thing that plays out in the real world — cities across Florida can and do provide electricity to their residents at cheaper rates than profit-driven investor-owned utilities," St. Pete Council member Richie Floyd, who supported his city studying the issue, told Axios on Thursday.
- The Dump Duke St. Pete campaign contends that a city-owned utility would allow for more accountability and prioritize residents over shareholders.
What's next: Clearwater City Council members will discuss the study at Monday's meeting.
- It starts at 6pm at the Clearwater Main Library.
Editor's note: This story was updated to add a comment from St. Pete Council member Richie Floyd.