TEP study warns Tucson grid takeover would spike costs and debt | Local News

TUCSON, Ariz. (KVOA) – Tucson Electric Power (TEP) has raised concerns over a proposed city takeover of its local energy grid, describing it as financially unfeasible and a threat to service reliability. According to TEP, the move would impose an enormous financial burden on Tucson taxpayers and escalate electric bills significantly over the next two decades.

A study by The Brattle Group, commissioned by TEP, estimates that acquiring TEP’s electric distribution system would cost the city more than $4 billion. This expense, along with ongoing service costs, could increase electric bills by $5.8 billion over 20 years. The study indicates that the additional cost to customers could start at $162 per year, rising to $900 annually after 20 years.

“These latest findings reaffirm what we have consistently stated: A government takeover of our system would be an unrealistic, unaffordable, and unnecessary distraction,” TEP CEO Susan Gray said.

Gray emphasized the financial risks, stating that the takeover would place a burden on Tucson families and businesses and potentially undermine the reliability of a critical service. The Brattle Group study further highlighted that 93 percent of similar municipalization attempts have failed due to high costs and legal challenges.

“Pursuing this course of action would put our community’s energy future at risk,” Gray said. “A forced takeover would jeopardize reliability, slow clean energy development, and create roadblocks for economic development initiatives that depend on TEP’s proven ability to deliver power safely, reliably, and sustainably.”

A survey conducted by WestGroup Research for TEP found that 81 percent of local residents are highly satisfied with TEP’s service. More than 90 percent expressed satisfaction with the reliability of their service.

“The activists who have been trying to drum up support for a city takeover don’t reflect the perspective of our larger community,” Gray said. “I think most people want to see TEP and the City of Tucson focusing on what they each do best.”

TEP has been collaborating with the city to support its energy objectives, including providing 100 percent renewable power for municipal operations. Gray expressed hope that the city would reconsider the takeover proposal, allowing both parties to focus on enhancing the community’s quality of life and economic strength.