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Tampa, utility clash over electricity payments

TAMPA — How much money is the electricity generated by the city's garbage plant worth?

That question has city and Tampa Electric Co. officials locking horns.

As negotiations over the power from the McKay Bay waste-to-energy plant grow more heated, the city is exploring using the electricity itself to run its wastewater and water treatment plants.

Tampa built the plant in the 1980s, and Tampa Electric agreed to buy that power.

The agreement expires in 2011.

Tampa Electric, which paid the city $3.4-million in 2007 for the plant's electrical capacity, has offered to pay $5.4-million in 2012, with payments increasing to $7.6-million in 2024.

The utility also has agreed to increase the payments if the value of renewable energy sources increases, and to let the city keep renewable energy credits for the plant. Those credits could become valuable if new rules are approved that would require utilities to get a percentage of their power from renewable sources.

But the city wants $10.8-million in 2012, with the amount increasing to $22.7-million in 2024, said Rick Morera, a spokesman for Tampa Electric.

The utility says that price is too high and would not receive approval from the Florida Public Service Commission.

"If the city can get more than what we're offering, they're welcome to do that," said Tom Hernandez, vice president of energy supply for Tampa Electric.

The dispute has put on hold a 25-year franchise agreement that will determine how much the utility has to pay to run its power lines on city property.

That contract has been in the works for more than two years.

City Attorney David Smith said the two agreements should go forward together. But Morera said the two contracts have nothing to do with each other.

"We've negotiated in good faith with the city on that franchise agreement," he said. "We should be able to move forward with it without the McKay Bay agreement."

Janet Zink can be reached at jzink@sptimes.com or (813) 226-3401.

>>FAST FACTS

Watering fines

The Tampa City Council on Thursday lowered fines for illegal lawn watering two weeks after increasing them, saying the previous vote was a mistake. The council had approved an ordinance that allows for instant tickets for code violations. But council members didn't realize that the move would increase water fines as well, raising the fine for a first offense from $100 to $150 and increasing later fines, too. On Thursday, it moved the fines back to the original rates, which are $100 for the first offense, $200 for the second offense and $450 for the third.

Tampa, utility clash over electricity payments 03/20/08 [Last modified: Friday, March 21, 2008 12:09am]
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