Continued High Fuel Costs Will Increase Electricity Prices

TAMPA, Fla., Sep 02, 2008 (BUSINESS WIRE) -- Today, Tampa Electric made its annual fuel filing with the Florida
Public Service Commission (FPSC). As the company originally announced in
July, based on its most recent analysis of actual and projected fuel
costs for 2008, total fuel costs for the year will exceed original
projections and are expected to remain high through 2009.

Costs experienced through July exceeded projections by 9 percent, but
with no relief expected for the balance of the year, as well as some
hurricane activity in the Gulf of Mexico and the continuation of
increased costs projected in 2009, the company estimates that by
year-end, it will be under-recovered by $209 million, or about 20
percent. The company is not seeking a surcharge this year to address the
under-recovery. Instead, it intends to address it through its 2009 fuel
charge.

President Chuck Black said, "Just as fuel is
used to power cars, fuel is also used to power electric generators. This
unprecedented run up in fuel prices has been frustrating for our entire
team and truly challenging for our customers on all energy fronts. As we
produce and deliver electricity, we are doing all we can to minimize our
fuel costs through hedging purchases where appropriate and maximizing
our use of coal, a more affordable fuel."

Tampa Electric's fuel mix is primarily made up
of coal and natural gas. While substantial and growing portion of an
electric bill, fuel costs are what is known as a "pass-through"
component. They are collected from customers by the utility and used to
pay fuel suppliers, typically the large oil and coal companies, without
any mark-up. This keeps electricity prices as low as possible to
customers.

Fuel Cost Increases

The cost of fuels, including those used to produce power, has risen
dramatically in the past eight years and especially in the past year.
Based on current market price levels, Tampa Electric's
2009 fuel costs are expected to be about $1.4 billion, which is $278
million or 25 percent greater than the company's
original 2008 projection filed with the FPSC in September 2007.

Due to the $209 million under-recovery for 2008, combined with recent
projections for 2009 fuel costs, the company estimates that starting in
January 2009, the bill for a residential customer using 1,000
kilowatt-hours of electricity per month will be about $140, compared to
the present bill of $114. This 2009 bill is a projection and may vary
depending on factors like fuel market price fluctuations, hurricane
events and other bill impacts. It does not reflect the company's
recently announced plans to request an increase to its base rates and
service charges, which would be effective in May 2009. At that time, the
bill for the same residential customer described above would increase by
7.5 percent to $150.

Energy Efficiency Programs

To help manage the increase, customers have a wide variety of energy
efficiency programs available through Tampa Electric.

Tampa Electric recently added 12 new energy efficiency programs to its
roster; the company also made improvements to several longtime programs.
The company received approval from the FPSC to expand its innovative
Energy Planner pilot program to all new qualified customers beginning in
October.

Energy Planner allows customers to make energy consumption decisions
based on near real-time energy prices by using a programmable "smart"
thermostat provided by the company at no charge. Customers participating
in the pilot study saved an average of a month's
worth of electricity over the course of a year. Other new programs
include a Low Income program, where qualified customers can receive a
number of items geared toward increasing their home's
energy efficiency.

Continuing the company's efforts to offer
innovative energy efficiency solutions to all customer groups, the
company also recently launched a new program for commercial customers.
Known as Demand Response, the program will pay incentives to
participating commercial customers when they conserve energy at times of
peak demand.

Through these programs, Tampa Electric believes that the average user of
electricity can help minimize the impact of electricity price increases.

For more information on the company's energy
efficiency programs, visit online: www.tampaelectric.com.

About Tampa Electric

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.
Tampa Electric serves almost 667,000 customers in West Central Florida.
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. Fuel prices are dependent on
market conditions, and customer rates are dependent on many factors,
including actions by the FPSC. 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, 2007.

SOURCE: Tampa Electric

Tampa Electric, Tampa 
Media: 
Rick Morera, 813-228-4945 
or 
Investors: 
Mark Kane, 813-228-1772

Copyright Business Wire 2008