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Clearwater council weighs exiting Duke Energy Clean Energy Connection after staff review shows long payback
Summary
After staff analysis showing the city has spent about $2.1 million with roughly $1.75 million in credits (a $383,401 shortfall) and revised payback projections, councilmembers signaled support for reconsidering participation in Duke Energy's Clean Energy Connection and asked staff to return with options and timing for exit.
City councilmembers on June 2 discussed whether Clearwater should continue participating in Duke Energy's Clean Energy Connection program after a staff review found the program's financial outcome is substantially less favorable than originally pitched.
Council member J. McCotton opened the conversation with staff calculations covering 32 months of participation (Aug. 2022 to March 2025). The city has paid program fees totaling about $2,100,000 and received roughly $1,747,000 in credits to date, leaving a net shortfall of about $383,401. Staff reported an internal projection that the city would reach break-even in 15 years (February 2037) and full payback in 27 years (2049), which is substantially longer than the 5- and 7-year break-even/full-payback estimates originally presented when the city joined the program.
Representatives noted Duke Energy disputes staff's calculations and provided its own projections: a break-even between 9 and 13 years and full payback between 17 and 24 years. City staff and councilmembers said those revised timelines still fall well short of the original pitch and expressed concern that weather events, supply chain impacts and other risks could push payback even further.
Cassie Cordova, sustainability/environmental division manager, explained how the program works: the city pays a monthly program fee per kilowatt on top of its usual electricity charges and receives renewable energy credits and a credit on the utility bill. The program is 33 years long and the structure anticipates that in the early years participants may pay more than they receive, with credits increasing over time; staff nonetheless said the empiric results since 2022 have been disappointing compared with the earlier expectations.
Several councilmembers said they were inclined to follow Pinellas County's recent decision to stop paying into the program and asked staff to return with analysis of the most advantageous exit date and the financial implications of leaving at different points in the program cycle. City Manager Dan Slaughter suggested staff identify the timing that limits additional near-term payments while minimizing stranded costs. Cassie Cordova said payments are monthly and that an operational decision could be timed to a low-exposure month; staff recommended evaluating an October 1 effective date (the county's effective date) as one option.
Councilmembers emphasized that the city remains committed to clean-energy goals but said the program's long payback estimates and the current net shortfall make continuation questionable. Several asked staff to prepare alternative pathways to meet the city's renewable targets that have clearer, faster returns.
No formal vote was taken at the work session; staff will return with an analysis of exit timing, the near-term financial impact of different exit dates, and recommended alternative strategies to meet renewable energy objectives.
