News Release

TECO Energy completes common stock offering, including overallotment shares

TAMPA, October 23, 2002

TECO Energy (NYSE:TE) announced that it has completed its public offering and sale of new common shares. This includes the offering of 17 million shares plus an over-allotment of 2.385 million shares, which the underwriters exercised their option to purchase.

All of the shares in the offering, including those included in the over-allotment, were sold to the public at a price of $11 per share. Proceeds from the offering and the over-allotment totaled approximately $207 million after underwriting discounts and commissions.

Chairman and CEO Bob Fagan said, “The successful completion of this offering significantly accelerates our financing plan for 2002 and 2003, and it reduces the execution risk. Our strong utility operations and profitable unregulated businesses with strong cash flows proved attractive to investors, even during a period of share price weakness for the utility industry and power price weakness in some markets served by TECO Power Services.”

“We have now satisfied an important part of our 2002-2003 plan, which includes our focus on maintaining the dividend,” added Fagan. He went on to say that the company was particularly pleased that, even during a period of market uncertainty and extreme volatility in the energy sector, there was sufficient investor demand to support increasing the size of the offering from 15 to 17 million shares, as well as the over-allotment option.

“We have not seen markets this difficult for the utility industry in a very long time, if ever, yet we were able to make this offering happen and further strengthen our balance sheet. Since the end of 2000, we have reduced our debt to total capital ratio from 62 percent to 51 percent, including the positive effect of this offering. I’m very proud of our achievements in this area,” said Fagan.

Morgan Stanley was the lead manager, and UBS Warburg, Banc of America Securities LLC, Salomon Smith Barney, Robert W. Baird & Co. and CIBC World Markets acted as co-managers in the transaction.

TECO Energy (NYSE: TE) is a diversified, energy-related holding company headquartered in Tampa. Its principal businesses are Tampa Electric, Peoples Gas System, TECO Power Services, TECO Transport, TECO Coal, and TECO Solutions.

Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. These forward-looking statements include references to the company’s business plan for 2002 and 2003. Certain factors that could cause actual results to differ materially from those projected in these forward-looking statements include the following: energy price changes affecting TPS’ merchant plants; TPS’ ability to sell the output of the merchant plants operating or under construction at a premium to the forward curve prices and to obtain power contracts to reduce earnings volatility; any unanticipated need for additional equity capital that might result from lower than expected cash flow or higher than projected capital requirements; TECO Energy’s ability to successfully complete the monetization of its synthetic fuel and gasification facilities, the sale of gas properties and other actions identified in its new business plan; TECO Energy’s ability to maintain credit ratings sufficient to avoid posting letters of credit relating to its construction loans and to avoid providing additional assurances to counterparties; and TECO Energy’s ability to complete its planned refinancing of notes on terms that qualify as a debt-for-debt exchange for accounting purposes. Others factors include: general economic conditions, particularly those in Tampa Electric’s service area affecting energy sales; weather variations affecting energy sales and operating costs; potential competitive changes in the electric and gas industries, particularly in the area of retail competition; regulatory actions affecting Tampa Electric, Peoples Gas System or TECO Power Services; commodity price changes affecting the competitive positions of Tampa Electric and Peoples Gas System, as well as the margins at TECO Coalbed Methane and TECO Coal; changes in and compliance with environmental regulations that may impose additional costs or curtail some activities; TPS’ ability to successfully construct, finance and operate its projects on schedule and within budget; the ability of TECO Energy’s subsidiaries to operate equipment without undue accidents, breakdowns or failures; interest rates, credit ratings and other factors that could impact TECO Energy’s ability to obtain access to sufficient capital on satisfactory terms; and TECO Coal’s ability to successfully operate its synthetic fuel production facilities in a manner qualifying for Section 29 federal income tax credits, which could be impacted by changes in law, regulation or administration. Some of these factors and others are discussed more fully under “Investment Considerations” in the company’s Current Report on Form 8-K filed on September 25, 2002.