After two years studying public power, Clearwater moves toward new Duke deal

Clearwater City Council will consider a new 30-year franchise agreement with Duke Energy on Thursday, a decision that could end a two-year effort to determine whether the city should buy Duke’s local electric distribution system and operate its own utility.

As Clearwater’s 30-year electric franchise approached expiration, city leaders chose not to automatically renew Duke Energy’s contract. Instead, they spent two years studying whether Clearwater should join the roughly three dozen Florida municipalities that own and operate electric utilities. The effort included a $504,000 feasibility study, an independent appraisal of Duke’s distribution system and preparations for a potential bond issue. It also sparked organized opposition from residents and business groups who argued municipalization would leave the city with billions of dollars in debt.

Duke Energy’s proposed agreement traces back to a 30-year franchise Clearwater granted Florida Power Corp. in 1995. Duke assumed the franchise after acquiring Florida Power and has provided electric service in Clearwater since 2012. The franchise expired in December 2025, and the city and Duke have continued operating under its terms while negotiating a replacement.

NewGen Strategies & Solutions evaluated whether municipal ownership could lower electric rates, improve customer service, strengthen storm resilience, coordinate more closely with the city’s existing utilities, accelerate undergrounding projects and generate revenue that could reduce the city’s reliance on property taxes. The city hired the consulting firm in 2024 to answer those questions. After reviewing the study, the City Council authorized an appraisal of Duke’s local distribution system and later approved the legal framework that would allow Clearwater to issue up to $592 million in revenue bonds if it decided to pursue an acquisition.

Rather than pursuing municipal ownership, the ordinance before the council would authorize a new 30-year franchise agreement allowing Duke to continue constructing, operating and maintaining Clearwater’s electric distribution system while preserving the city’s 6% franchise fee.

Beyond renewing Duke’s franchise, the proposal commits the utility to a series of economic development and infrastructure initiatives. Under a memorandum of agreement negotiated alongside the franchise, Duke would fund a downtown retail development strategy, contribute $100,000 annually for six years toward infrastructure resiliency projects, provide economic development funding for the North Greenwood Community Redevelopment Agency, help fund shade structures at Coachman Park through a 20-year naming rights agreement, construct a looped electric feed serving Clearwater Police Headquarters and provide annual updates on its electric distribution network, vegetation management and storm resiliency efforts.

The Clearwater Energy Alliance, a project of the Pinellas Energy Alliance, argued that acquiring Duke’s system could ultimately cost about $1.1 billion once financing and other costs were included and warned the debt could lead to higher taxes or reductions in city services.

Clearwater is not the only Pinellas County city weighing public power. In neighboring St. Petersburg, advocates have launched a campaign urging city leaders to study replacing Duke with a municipal electric utility, arguing local ownership could improve reliability, accelerate undergrounding and give the city greater control over its energy future. Opponents have raised many of the same concerns heard in Clearwater, including acquisition costs, litigation risk and the complexity of operating an electric utility.

If the ordinance passes its first reading Thursday, it would return to the City Council on Aug. 6 for a second and final vote.