Tucson Council adopts energy collaboration agreement, sends franchise election to November ballot

Mayor and council on April 7 adopted an Energy Collaboration Agreement (ECA) with Tucson Electric Power (TEP) and voted to put a related franchise measure on the November 3, 2026 ballot.

The ECA commits TEP shareholders — not ratepayers — to contribute a multi‑year stream of funds the city can use for climate resilience and affordability programs. Council and staff said the most recent draft raises the funding escalator to 2% annually and would bring the total investment available to the city from the earlier $56 million estimate to roughly $64 million over the life of the agreement if fully enacted. The agreement also assigns the city responsibility for project design and execution and creates an advisory role for the City’s Commission on Climate, Energy and Sustainability to provide community oversight.

The agreement is explicitly tied to a franchise that would extend TEP’s permission to use public right‑of‑way for electric transmission and distribution. Council voted to call a special, vote‑by‑mail franchise election for Nov. 3, 2026 so Tucson voters can approve or reject the franchise — and, if approved, allow the ECA to go into full effect.

Supporters said the funds give Tucson a reliable, dedicated source to pay for projects such as home efficiency upgrades, neighborhood cooling sites, battery backup for critical community facilities and workforce training. “This creates an opportunity to scale the work we know is needed,” Mayor Raa Romero said during the study session, noting the city lacks direct state funding for many climate needs.

Opponents and some members of the public urged more time and stronger guarantees. Speakers at city hearings raised concerns about: the 25‑year term, recent utility rate proposals, TEP’s past support for gas‑fired generation and large data centers, and whether the agreement provides sufficient enforceable protections. Some asked that any franchise text remain amendable and clearly described to voters; staff said the final franchise language can be revised up to the statutory deadlines that govern the election process.

Council members who voted for the ECA said the measure balances pragmatism and accountability: it secures community investments now, keeps project selection in civic control, and preserves options — including exit clauses — should TEP fail to meet the agreement. The final council adoption vote was 6–0, and the ordinance calling the franchise election likewise passed 6–0.

Next steps: the city will place the franchise measure on the November ballot; if voters approve the franchise, shareholder funds under the ECA would be available to the city for the programs described in the agreement. Council members and staff said they will continue oversight of implementation and pursue further protections and transparency around rates and projects.