Power Player

REVIEW SUMMARY
Who. John B. Ramil
Roles. President/CEO of TECO Energy Inc., chair of USF Board of Trustees
Key. Finding balance between two highly important local positions

John Ramil's professional background is in engineering, but he has gone so much farther with his career in the utilities industry and involvement in the Tampa Bay community.

The Tampa native, who has bachelor's and master's degrees from the University of South Florida, started out with Tampa Electric Co. as a cooperative education student in 1976. He took on other positions with the company in operations, marketing, customer service and environmental, later becoming vice president of energy services and planning, then president.

That led to his steady climb with parent company TECO Energy Inc., where he has served as executive vice president, CFO and COO. Last August, he took on the dual roles of president and CEO, and could be in line to succeed TECO's retiring chairman, Sherrill Hudson, by the end of next year.

“I think somewhere along the way, somebody figured out maybe I wasn't a good engineer and they needed to move me,” Ramil jokes, noting that he stayed in each position two to four years. There were times early on, he now admits, that he almost didn't make those moves because he was accustomed to the job he already had.

“I learned that every time you moved and got out of your comfort zone, that's how you grew,” he says. He now encourages younger TECO employees, as well as college students, to impress upon their supervisors that they are open to new opportunities and challenges.

Extensive involvement

Education is a dual role for Ramil these days. Besides leading an independent utility with 4,000 employees and more than a million electric and natural gas customers, he also chairs the USF Board of Trustees, overseeing its direction as a major college and an economic engine for the Tampa Bay region.

But his involvement outside the company isn't limited to that. He also serves on the boards of Blue Cross and Blue Shield of Florida, the Florida Chamber of Commerce, the Straz Center for the Performing Arts and the Edison Electric Institute. He is also a past chair of the Greater Tampa Chamber of Commerce.

Ramil says strong support from his administrative staff at TECO's downtown Tampa headquarters, and from his wife, daughter and son, allows him to take on all his various activities. Also making things easier lately is the fact that TECO is in sound operating shape, expecting 2010 revenue to top the prior year's total of $3.3 billion and nearing its 52-week high of $18.50 a share on the New York Stock Exchange.

“We have done everything we told Wall Street we were going to do,” Ramil says, including improving TECO's balance sheet, paying down debt and maintaining good earnings growth over the last several years.

The company's last major transaction was the $605-million sale of its power distribution segment in Guatemala, where it retains two power plants, collecting $181.5 million on the deal last October.

“When you tell investors what you're going to do and then you do it, they reward you,” he says, “but some of that reward is expected good performance (going forward). You can't let your guard down.”

That also helps when approaching the capital markets, he adds. TECO invested $1.1 billion in new capital over the last three years to meet government requirements, handle market growth and upgrade equipment, he says.

But maintaining good results has its challenges in the utility industry. For example, TECO's Peoples Gas segment is required to refund $3 million to its Florida residential customers under a profit-cap agreement with the state Public Service Commission.

Declaring independence

All in all, Ramil emphasizes TECO's commitment to remain independent amid utility industry consolidation, including the pending $14-billion merger of Progress Energy Inc. with Duke Energy Corp. (Progress was formed in 2000 when St. Petersburg-based Florida Progress Corp. merged with Carolina Power & Light.)

While TECO still gets the occasional call from an investment banker proposing a deal, or there's “noise in the market” speculating a potential buyout, Ramil is comfortable with the company's current position, noting that it has provided a 59% return to shareholders over the last two years.

“Any type of merger or acquisition, whether it's the total company or a particular business, is an opportunity that might come up, but not a strategy,” he says. “We like where we are. We like our future.”

In addition to Tampa Electric and Peoples Gas, TECO has a coal-mining operation in eastern Kentucky that generates nine million tons annually for third-party sales, including coal used in the manufacturing of metals, plus its Guatemala power plants in San Jose and Alborada.

Ramil sees similarities in his current dual capacities as TECO president and USF trustees chair. Both have similar governance issues and operate publicly, he says, and share the same distinctions between board and management powers.

“It has helped me define my roles,” he says. For example, while he is used to answering questions in his role at TECO, his role at USF involves more asking.

Creating a medical base

Ramil's primary goals at USF are to continue growth in research funding, now at the $400 million mark, and advance the participation of health-related schools within that industry. USF recently broke ground downtown on its Center for Advanced Medical Learning and Simulation, which will combine health-care training with simulation-based education and attract thousands of visitors and industry leaders each year.

Besides the jobs to be generated from CAMLS, Ramil says USF expects economic gains from its partnership with Bar Harbor, Maine-based Jackson Laboratories, which seeks to open a research center along the Gulf Coast with 250 employees and $160 million in annual revenue. A location closer to USF would be a “double bonus” for the Tampa Bay area, he says.

Another priority was locking in Judy Genshaft, USF's veteran president, with a new five-year contract that assures she will complete her educational career at the Fowler Avenue campus. Genshaft is set to receive $745,000 a year, plus retirement benefits.

As for his own future, Ramil says it will be up to TECO's board to determine whether he will be promoted to chairman. What isn't likely to happen, he says, is holding the dual titles of president and CEO as he does now.

“It allows for better governance,” he says. “The more perspectives you have on a board or a management team, from people who respect each other and can debate differences of opinion in choosing the best course of action, you are better off in today's complex world.”

Advice to Obama and other thoughts

As president and CEO of TECO Energy Inc. and a director of the Edison Electric Institute, John Ramil is well-versed on meeting power demands today and tomorrow. He would make a good advisor to President Barack Obama on the subject.

During his Jan. 25 State of the Union address, Obama set a goal of generating 80% of the nation's electricity from clean energy sources by 2035, specifically challenging oil and coal producers.

However, Ramil counters that the biggest problem with the goal at present is that solar and wind energy generation are far more expensive than utility customers are willing to pay. If they were profitable, TECO would already offer those forms, he says.

“We are implementers of policy, but we also have to demonstrate to the capital markets that we can earn a return,” Ramil says. “The wind doesn't always blow and the sun doesn't always shine. We have to be able to ensure consistency to consumers.”

Ramil shared his thoughts on other current topics during a recent interview with the Business Review.

Economic development: While the health-care sector is important to Ramil as chair of the USF trustees, he sees other areas of potential for attracting new jobs to the area.

“We can still be a center for business operations, where companies put their data centers and those types of things here. Environmentally friendly light manufacturing would also be good.”

Ramil noted that Tampa lost out to Savannah, Ga., on a Mitsubishi turbine manufacturing plant last year that would have brought machinist jobs paying around $70,000 annually, largely because a waterfront site in Savannah was readily available.

Transit improvements: Ramil points out that Tampa Electric's origins were from powering the city's streetcar system more than a century ago, and TECO committed $1 million to the modern trolleys of the last decade. TECO also donated $40,000 to last year's Moving Hillsborough Forward initiative, which failed in the November election.

“I saw 42% support of the referendum as a positive sign. We haven't hit the right timing, the right approach. A lot of feedback we got was people would like to see more specifics on how the money would be spent and how folks would be accountable — all fair questions. If we can get the project, the planning and the story right, we can get it through.”

Tampa's next mayor: “It's easy to make the popular decision. It's hard to make the tough decisions that you have to in tough times. We need a mayor who can make those tough decisions but can face everybody and say 'this is why I did it.' I have to do that with this company every day.”

Rays baseball stadium: “The facts that I've seen about most major league teams, and where the center of gravity in population is versus the distance to the stadium, seem to be compelling. We seem to be an outlier. Hopefully the No. 1 goal of everybody involved is we need that team in this community, and hopefully we can make that happen. But from a business standpoint, St. Pete has a deal and that deal has to be met.”