Agreement Between the City and TEP Promotes Energy Infrastructure

After more than a year of community engagement, including more than 10 town halls and public meetings, the City of Tucson and Tucson Electric Power (TEP) entered into a voluntary Energy Collaboration Agreement (ECA) to invest in energy affordability and community resilience. The ECA will be effective upon voter approval of a new franchise agreement between the City of Tucson and TEP in November, which is outlined in Prop 421.

TEP has operated under its current agreement with the City since November 2000. The 25-year franchise agreement helps the utility and City work efficiently on projects on streets, alleys, and public rights-of-way. It avoids extra cost and delays while making regular maintenance and outage response faster. The new agreement preserves the current fee structure, and the 2.25% franchise fee customers pay.

Under the terms of the Energy Collaboration Agreement, TEP will invest $2 million per year on infrastructure and sustainability projects, with the funds increasing 2% each year, eventually totaling $64 million. The funding comes from corporate resources and cannot be recovered through customer electricity rates.

Implementation of the ECA will be guided by community input, with oversight from the City of Tucson Commission on Climate, Energy, and Sustainability-the advisory body to Mayor and Council. The agreement will be reviewed at least twice a year and can be updated at any time.

The ECA focuses on strengthening preparedness for extreme heat, advancing clean energy solutions, providing energy programs and resources for all customers, and championing pathways to energy-related careers.

Examples of what the Energy Collaboration Agreement can support are:

• Bill assistance for low-income households
• Home retrofits to reduce energy use
• Resilience hubs with solar and battery storage
• Increased tree canopy
• Electric vehicle charging infrastructure
• Home solar and battery storage
• School outreach, internships and apprenticeships for energy-related careers

To read the franchise agreement and ECA, follow the link on the right of this page (desktop) or mobile (below).