Bill Peacock, Policy Director for The Energy Alliance said acquiring utility assets in St. Petersburg would require billions in debt-financed purchases, exposing residents to legal delays and operational risks that have historically burdened ratepayers without delivering savings.
“Municipalization is a high-cost, high-risk strategy with uncertain benefits,” said Peacock. “Once municipalization moves from slogans to spreadsheets, projected savings disappear while costs become immediate and concrete. What advocates describe as eliminating profit is frequently replaced by decades of debt service. Before pulling the municipalization lever, local leaders and residents should ask a simple question: If the savings are uncertain but the costs are guaranteed, who bears the risk? History suggests the answer is the people paying the bills.”
In an opinion piece on Business Daily Network, Peacock detailed the financial pitfalls of municipalization for St. Petersburg and Clearwater. He drew on examples from Boulder and Chicago where similar efforts ended due to litigation and rate increases. Peacock emphasized that costs for asset acquisition and system separation escalate rapidly, providing cost estimates ranging from $1.13 billion to $1.52 billion for Clearwater as a cautionary parallel for St. Petersburg.
According to an independent valuation by Concentric Energy Advisors, municipalization costs in Clearwater are projected between $1.13 billion and $1.52 billion, factoring in asset purchases, separation from regional grids, and startup expenses. This amount surpasses the city’s annual budget and would be funded through bonds repaid by residents. St. Petersburg faces similar projections scaled up due to its larger grid, with franchise agreement expiration in August adding urgency to the debate.
Florida cities like Clearwater and St. Petersburg receive substantial franchise fees from Duke Energy, amounting to $28.2 million and $52 million annually, which support local services. Municipalization would eliminate these revenues, requiring tax hikes or budget cuts alongside debt service obligations.
According to reporting from Brattle, over the past 25 years, 64 U.S. municipalization initiatives resulted in only five ongoing municipal utilities, with 92 percent abandoned due to high costs and risks.
Peacock has over 30 years of experience in Texas government and policy roles including vice president for research at the Texas Public Policy Foundation and deputy commissioner at the Texas General Land Office.
