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Tampa Electric, Southwest Florida Water Management District and the City of Lakeland join forces on innovative reclaimed water project

The project will help protect valuable groundwater supplies while providing significant environmental benefits in the Tampa Bay region.

TAMPA, March 31, 2009

Tampa Electric today announced that the company has signed a Reclaimed Water Supply Agreement with the City of Lakeland to cost-effectively supplement future water needs at Tampa Electric’s Polk Power Station. The Southwest Florida Water Management District (SWFWMD) is also working with Tampa Electric on this innovative public-private project that will beneficially utilize reclaimed water that is currently being discharged to the Alafia River ultimately flowing into Tampa Bay.

The project consists of a reclaimed water pumping station and transmission pipeline of approximately 15 miles in length from the City of Lakeland’s wetland treatment system, which is located east of Mulberry and north of State Road 60, to Tampa Electric’s Polk Power Station. The project also includes a water treatment system and a deep underground injection well system on Polk Power Station property.

“We are pleased to partner with the Southwest Florida Water Management District and the City of Lakeland on this project.  It is an excellent example of a public-private partnership that will benefit the environment and protect our water resources by utilizing an alternative wastewater source in a productive way,” said Chuck Black, Tampa Electric president.

“Lakeland’s participation in this regional reclaimed partnership provides long-term benefits to our customers” said Tony Delgado, Deputy City Manager.  “Our 20-year water use permit and the reduced dependence upon surface discharge for wastewater disposal provide both valuable system capacities and avoidance of future costs. This relationship with Tampa Electric was carefully evaluated over the last 9 months with the City Commission unanimously endorsing the agreement at its March 16, 2009 meeting.”

Through a 30-year Reclaimed Water Supply Agreement, Lakeland will provide the Tampa Electric Polk Power Station with approximately five million gallons per day of reclaimed water.  The project will:

  • Maximize the beneficial reuse of reclaimed water using Tampa Electric’s Polk Power Station,
  • Reduce the amount of reclaimed water the City of Lakeland is currently discharging into the Alafia River and ultimately into Tampa Bay,
  • Ensure that the Polk Power Station site has a reliable water supply for potential future generation capacity additions, and
  • Reduce the amount of groundwater withdrawals at the Polk Power Station.

As part of a cooperative funding agreement, the Southwest Florida Water Management District will reimburse Tampa Electric up to 50 percent, or approximately $32.8 million, of the eligible project costs.  Fifty percent of the SWFWMD funding will be provided by its Governing Board with the remaining 50 percent to be split equally among its Alafia River and Peace River Basin Boards.  The project has also received an additional $2,500,000 from the state’s West-Central Florida Water Restoration Action Plan fund.  Future funding is contingent upon board approval. 

Tampa Electric will manage the project and will be responsible for its permitting, design, construction, operation, maintenance, repair and, once the project is constructed, for taking all of Lakeland’s reclaimed water flows.  Tampa Electric’s total investment in the project is currently estimated to be approximately $55 million over the next several years, after taking into consideration the approximately $33 million of SWFWMD cofunding.  Lakeland will provide its reclaimed water to the project at no cost for the first 20 years of delivery, with the issue of compensation to be revisited in the 20th year.

Tampa Electric Company is the principal subsidiary of TECO Energy, Inc. (NYSE: TE), an energy-related holding company, with regulated utility operations in Florida including both Tampa Electric and Peoples Gas System. Other subsidiaries include TECO Coal, which owns and operates coal production facilities in Kentucky and Virginia, and TECO Guatemala, which is engaged in electric power generation and distribution and energy-related businesses in Guatemala.

Note: This release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Actual results or outcomes may differ materially from those forecasted. The forecasted information is based on the company’s current expectations and assumptions, and the company does not undertake to update that information or any other information contained in this release, except as may be required by law. Additional information is contained under “Risk Factors” in TECO Energy, Inc.’s and Tampa Electric Company’s combined Annual Report on Form 10-K for the period ended Dec. 31, 2008.

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