Case Background
On November 7, 2025, Tampa
Electric Company (TECO or Company) petitioned the Florida Public Service
Commission (Commission) for approval of its Manatee Protection Study (Study)
for cost recovery through the Environmental Cost Recovery Clause (ECRC). TECO
states that the Study is required to maintain compliance with its Manatee
Protection Plan, and should be completed by October 2026.
The National Pollutant
Discharge Elimination System (NPDES) program is administered by the Florida
Department of Environmental Protection (DEP) within the state. TECO was issued an updated NPDES permit on
August 27, 2025. NPDES permits prescribe requirements and limits to cooling
water discharges to surface waters. Additionally, this permit requires TECO to
maintain compliance with its Manatee Protection Plan approved by the DEP.
Specifically, TECO must maintain minimum discharge temperatures of the outflow
water from its Big Bend Power Station (Big Bend) from November 15 through
March 31 each year.
Pursuant
to Section 366.8255, Florida Statutes (F.S.), the Florida Legislature
authorized the recovery of environmental compliance costs prudently incurred by
investor-owned electric utilities through the ECRC. The method for cost
recovery for such costs was first established by Order No. PSC-94-0044-FOF-EI,
issued on January 12, 1994.[1] The Commission has
jurisdiction over this matter pursuant to Section 366.8255, F.S.
Discussion
of Issues
Issue 1:
Should the Commission approve Tampa Electric
Company’s petition for approval of the Manatee Protective Study for cost
recovery through the Environmental Cost Recovery Clause
Recommendation:
Yes. Staff recommends that TECO’s proposed Manatee
Protection Study is necessary to comply with its NPDES permit. Consistent with
prior ECRC orders, operation and maintenance (O&M) costs associated with
the Study should be allocated to appropriate rate classes on an energy basis.
(Lewis)
Staff Analysis:
TECO’s
Big Bend Power Station is located in Hillsborough County, along the shores of
Hillsborough Bay. Big Bend originally consisted of four coal-fired generating
units. TECO has since repowered Unit 1 to a natural gas-fired combined cycle
unit consisting of two combustion turbines and two heat recovery steam
generators. TECO retired Unit 2 in November 2021, and Unit 3 in April
2022. Unit 4 is a steam turbine that can
be fired with coal or natural gas.
Big Bend withdraws cooling water from Hillsborough Bay and that
water is discharged back into the bay at a warmer temperature. TECO’s NPDES permit requires the Company to
“minimize disruption of warm water outflows during the winter” and “maintain
discharge temperatures that will sustain manatees during cold events.” TECO’s
Manatee Protection Plan specifically states the following:
During the period
from November 15 through March 31 each year, to coincide with the time of
greatest manatee abundance, if the ambient water temperature falls below
61℉, as measured at the plant intake, the TEC Big Bend plant shall
reasonably endeavor to operate in a manner that maintains the water temperature
above 68℉. It is understood that due to circumstances that may compromise
plant safety and reliability, other regulatory compliance issues or unusual
weather conditions the target temperature level may not be achieved on a
continuous basis.
During an 11-day period in January 2025, TECO was unable to
maintain the temperature of the discharge water above the 68-degree threshold.
The Company attributes this to the operational changes at Big Bend discussed
above. While these operational changes increased the efficiency of Big Bend, it
has lowered the temperature of the discharge water when exiting the facility. Based
on the weather conditions experienced at Big Bend in January 2025, TECO
determined it is necessary to conduct a study to evaluate options for
maintaining discharge water temperatures above 68 degrees during the specified
timeframe, and thus, compliance with its Manatee Protection Plan and NDPES
permit.
TECO explained that the Study will consist of
the following:
- Reviewing historical operating data during
cold-weather conditions
- Evaluating Big Bend’s thermal discharge
characteristics
- Identifying physical or operational
changes that will allow the Company to maintain discharge canal
temperatures compliant with its NPDES permit
- Preparing a technical report that
summarizes the findings and recommendations
TECO
solicited bids for the study and stated that four responses were received. The
Company selected Burns & McDonnell based on their experience with Big Bend
and other large power generating facilities, technical expertise in thermal
systems, and proven safety record. TECO estimates that the Study will cost
$450,000 and anticipates it completion by October 2026. This amount, which was
included in the engineering proposal from Burns & McDonnell, was derived
using anticipated labor costs and comparisons to similar engineering studies at
large generating facilities. Staff notes that Burns & McDonnell was not the
lowest cost bidder.
In
response to staff’s data request, TECO provided data, as shown in Table 1-1, of
the estimated impact to a residential customer bill.
Table 1-1
Residential Bill Impact
|
Year
|
$ / 1,000 kWh
|
$ / 1,200 kWh
|
|
2025
|
0.00
|
0.00
|
|
2026
|
0.00
|
0.00
|
|
2027
|
0.02
|
0.03
|
|
2028
|
0.00
|
0.00
|
|
2029
|
0.00
|
0.00
|
The Commission’s criteria for ECRC
recovery relevant to this docket, established by Order No. PSC-94-0044-FOF-EI,
are:
(1)
The activities are legally required to comply with governmentally imposed
environmental regulation enacted, became effective, or whose effect was
triggered after the Company’s last test year upon which rates are based; and
(2) None of
the expenditures are being recovered through some other cost recovery mechanism
or through base rates.
Staff recommends that the Study proposed in TECO’s petition meets
these criteria. The Study described in the petition is necessary for the Company
to comply with governmentally imposed environmental regulations. The compliance
activities are necessary to maintain compliance with TECO’s Manatee Protection
Plan which is a requirement of its NDPES permit. The costs of the proposed compliance Study are not currently being
recovered through some other cost recovery mechanism or through base rates.
Staff notes that the reasonableness and prudence of individual expenditures
related to the Study will be subject to the Commission’s continuing review in
future ECRC proceedings.
Conclusion
Staff
recommends that TECO’s Manatee Protection Study is necessary to comply with its NPDES permit. Consistent with prior ECRC orders, O&M costs associated with
the Study should be allocated to appropriate rate classes on an energy basis.
Issue 2:
Should this docket be closed?
Recommendation:
Yes. This docket should be closed upon issuance of a
Consummating Order unless a person whose substantial interests are affected by the
Commission’s decision files a protest within 21 days of the issuance of the
Proposed Agency Action Order. (Imig)
Staff Analysis:
At the conclusion of the protest period, if no
protest is filed, this docket should be closed upon the issuance of a Consummating
Order.
