Jacksonville’s public utility is moving forward with a plan to explore privatization.
JEA’s board Tuesday unanimously approved the resolution, which is a response to falling revenues as customers use less electricity.
The other options on the table presented by CEO Aaron Zahn were to lay off more than 500 employees and to cancel plans to move the JEA headquarters.
Board Vice Chair Fred Newbill said the utility hasn’t been making money on the electric side of the business for the past decade.
"It's not going to get any better because technology is rapidly moving and so in order for us to move in a positive way, we have to do something,” he said. “We have to do something other than what we’ve been doing.”
Now that the leadership team has the backing of the board, they will set the process of selling the public utility in motion, which is expected to take about a year.
JEA plans to solicit offers from financial, technology and energy/water companies in August. They will work with a team of advisers through February and present their recommendations to the board by March of next year.
Zahn said he’s committed to a transparent and competitive process.
"We would have a commitment to being open and bringing to this board and the community, over the next series of nine months to 12 months, information as we collect it and go through this process," he said.
Zahn laid out a set of minimum requirements for any potential offer. First, a company would need to offer Jacksonville at least $3 billion for JEA, although a University of Florida study last year found that the electric and water utility is worth up to $7.5 billion. The company would also pay customers an additional $400 million - or about $350 per customer - and agree to at least three years of guaranteed base rate stability.
Additionally, whoever buys JEA would have to commit to providing 100% renewable energy to the City of Jacksonville and the public school system by 2030.
If the board greenlights JEA's final recommendation, it would go next to City Council for approval. Duval County residents would then have a final say in a referendum.