TUCSON, AZ (March 13, 2026) — Tucson Electric Power (TEP) and the City of Tucson are advancing a proposed 25-year Energy Collaboration Agreement tied to renewal of the utility’s franchise, a package that would direct an estimated $56.18 million toward climate, resiliency and low-income energy programs while asking voters to approve a new framework for TEP’s continued use of city rights-of-way.
According to TEP, the companion Energy Collaboration Agreement would begin at $2 million annually, with 2% increases every other year, for a projected total of about $56.18 million over 25 years. TEP says those funds would come from company resources and would not be recovered through electric rates, although the utility remains subject to the Arizona Corporation Commission’s regulation of its broader rates, rules, and operations.
The proposed franchise agreement would give TEP a non-exclusive 25-year right to construct, maintain, and operate its electric transmission and distribution system in city streets, alleys, and other rights-of-way. In addition to governing the utility’s use of public property, the agreement addresses construction, maintenance, permits, undergrounding, outage reporting, emergency coordination, and utility planning with the City…