Member System Profiles: Clearwater Gas System

Starting from modest beginnings in 1923 with a manufactured gas plant operation before natural gas transmission lines came to the peninsula of Florida, the Clearwater Gas System are now the 35th largest publicly-owned gas system in America, the 4th largest municipally-owned gas system in Florida, and a long-time active member of APGA. Chuck Warrington, the Managing Director & Executive Officer of the Clearwater Gas System, is a past Chairman of APGA and a very active member of several committees. He will be joining the Board of APGA at our Annual meeting in Halifax, Nova Scotia.

Chuck Warrington

While it is owned and operated as an enterprise utility by the City of Clearwater, the gas operation functions more like a gas district than a city utility due to its size. Its service area is now 13 times bigger than the actual city of Clearwater, covering 17 cities and 2 counties. Clearwater Gas System serves over 18,500 customers –so far- in a 330 square mile service territory, utilizing over 730 miles of underground gas main. They recently acquired 55 square miles of territory in a heavy growth area that could double service, and may triple their customer base in the next 15 years. How did they grow so large? Clearwater Gas created a strategic plan in 1993 and stuck with it, which has been one reason for the great success. The system has been expanding at 7-10% a year, well above the industry average. Part of this success may be also attributed to Mr. Warrington, who, after spending 20 years with Florida Power and Light setting up their marketing program, brought those same talents to Clearwater Gas.

Clearwater Gas faces constant challenges in keeping up with growth, since generating cash in a municipal context is difficult. Chuck Warrington notes that “we are bound by rules in fundraising and schmoozing that investor owned utilities do not face.” Fortunately, whereas many cities have to come before a city commission for approval every time they want to change the rate structure, the City of Clearwater has wisely allowed the gas utility some flexibility in setting rates. The gas system uses an investor-owned style progressive rate structure, so they can flow through expenses. Even though they are so large, they have retained an attitude of responsiveness to their customers. Clearwater Gas likes to say that it is “motivated by Main Street, not Wall Street.”

According to Chuck, APGA has allowed Clearwater Gas to have a “better appreciation of legislation and regulation on a national level, since small changes on a national level can trickle down to large changes for munis.” He notes that “Advocacy is the key role we expect APGA to do in DC for us, but the next tier after that is giving tools to operate utilities most efficiently and effectively.” One of the benefits of APGA membership for Clearwater has been being able to learn best practices in operations and marketing from the most progressive of systems, which happen to be the systems that are active in APGA.

Chuck concludes that he is “proud of APGA and (Clearwater Gas’s) relationship with them, and seeing it grow into one of finest organizations in DC.”

Originally in July 25, 2005 Public Gas News