FOR IMMEDIATE RELEASE: Tuesday, February 10, 2026
CONTACT: Christina Johnson
Tallahassee, Fla. – Today, Florida TaxWatch (FTW) released a report, Clearwater’s Plan To Establish Its Own Municipal Electric Utility Puts Taxpayers At Risk and undertakes this independent research project at the request of state Senator Nick DiCeglie (R-St. Petersburg) last month, whose legislative district includes portions of Pinellas County.
Duke Energy Florida (Duke) owns 12,500 megawatts of energy capacity, supplying electricity to two million residential, commercial, and industrial customers across a 13,000-square-mile service area in Florida. Consistent with Florida Public Service Commission rules and regulations, Duke provides electric services to the City of Clearwater (City).
Citing residents’ concerns about high electricity bills, tree trimming issues, and power line maintenance, the City contracted with NewGen Strategies and Solutions, LLC, and its partners to conduct a study of the feasibility of establishing a municipal electric utility to serve the City’s residents and businesses. The results of the September 2025 study suggest that for all 30 years of the study period, the Clearwater municipal electric utility (MEU) “could potentially provide service to its customers at lower average system retail rates than those estimated for Duke while providing reliable power to its citizens.”
Florida TaxWatch, however, cautions the City of Clearwater not to proceed with the planned acquisition of Duke’s electric distribution assets and the establishment of a municipal electric utility.
Florida TaxWatch President and CEO Jeff Kottkamp said, “Florida TaxWatch considers the City of Clearwater’s efforts to take over electric utility service from a private company to be a huge financial risk for something that is projected to generate single-digit savings, at best, for the first few years of operation. No matter how much the City thinks this effort will cost, or how long this process will take, it is going to cost more and take longer to do. This collective belief is based upon: (1) a heavily qualified feasibility study with too many assumptions and unknowns; (2) a timeframe going forward that is not realistic; and (3) a 25-year body of research that is not favorable to or supportive of such as takeover. Moreover, there are some things the private sector does better than the public sector, and the provision of electric power service is one such example. The challenge facing the City going forward is determining whether the financial risk is worth the potential reward. Florida TaxWatch believes the answer to this challenge is a resounding ‘no.’”
Florida TaxWatch recommends the City of Clearwater and Duke Energy Florida immediately begin negotiating a new franchise agreement—one that represents a ‘win-win’ for the City, Duke Energy Florida, and most importantly, the taxpayers.
Feasibility studies performed on behalf of municipalities frequently underestimate the cost of completing municipalization efforts. It is also important to note that when ratepayers are asked to vote on municipalizing their electric utility, the voters overwhelmingly choose against municipalizing. A review of municipalization case studies suggests three primary reasons for the failures: (1) cost escalation; (2) length of time required; and (3) reluctance of the voters to approve municipalization.
The FTW analysis consists primarily of three parts. A more detailed analysis may be found here.
- Part One – Florida TaxWatch lays bare the analysis conducted by the NewGen Project Team. FTW looks closely at the City’s proposed plan to acquire Duke’s electric distribution assets; the projected costs and timing of this acquisition; and every assumption or factor that went into the feasibility study’s conclusion that the City’s acquisition of Duke’s distribution assets and the formation of a municipal electric utility is ‘feasible.’
- Part Two – Florida TaxWatch analyzes the NewGen Project Team’s plan to establish an MEU.
- Part Three – Florida TaxWatch outlines its conclusions and the reasons behind its recommendation that the City of Clearwater not proceed with the planned acquisition of Duke’s electric distribution assets and the establishment of a municipal electric utility.
About Florida TaxWatch
As an independent, nonpartisan, nonprofit government watchdog and taxpayer research institute, and the trusted “eyes and ears” of Florida taxpayers for more than 45 years, Florida TaxWatch (FTW) works to improve the productivity and accountability of Florida government. Its research recommends productivity enhancements and explains the statewide impact of fiscal and economic policies and practices on taxpayers and businesses. FTW is supported by its membership via voluntary, tax-deductible donations and private grants. Donations provide a solid, lasting foundation that has enabled FTW to bring about a more effective, responsive government that is more accountable to, and productive for, the taxpayers it has served since 1979. For more information, please visit www.floridataxwatch.org.
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