Exhibit 10.2


                              May 24, 1999



Mr. Robert D. Fagan
TECO Energy, Inc.
702 N. Franklin Street
Tampa, FL 33602

Dear Mr. Fagan:

     This  will  confirm certain terms and conditions relating to your
employment by TECO Energy, Inc. (the  Company ).

     1.   Duties.    You  shall serve at the pleasure of the Company s
Board of Directors and you shall perform such executive duties for the
Company  and  its  subsidiaries  as  may  be  assigned  to  you by the
Company's  Board  of  Directors.   While so employed, you shall devote
your  full  employable  time to the performance of such duties and use
your  best  efforts  to  promote  the interests of the Company and its
subsidiaries.    You  shall,  at the pleasure of the Company, serve on
such  boards  of  directors  and  committees  of  the  Company and its
s u bsidiaries  and  hold  such  offices  with  the  Company  and  its
subsidiaries to which you may be duly elected or appointed.

     2.   Compensation Upon Other Termination.  If, within three years
of the date hereof, your employment shall be terminated by the Company
other  than  for Cause or Disability or if it is terminated by you for
Good Reason, then you shall be entitled to the following benefits:

          (a)  The Company shall pay you your full base salary through
the  date  of  termination at the rate in effect at the time notice of
termination is given, plus all other amounts to which you are entitled
under  any compensation plan of the Company, at the time such payments
are due.

          (b)    In  lieu  of  any  further salary payments to you for
periods  subsequent  to the date of termination, the Company shall pay
as  severance pay to you a lump sum severance payment within five days
after  the  date  of termination equal to two times the sum of (1) the
highest annual rate of base salary in effect at any time within the 12
months  preceding  the  date of termination and (2) the greater of (A)
your targeted annual incentive award as of the date of termination and
(B)  the most recent annual incentive award paid to you by the Company
preceding the date of termination.

          (c)    For  a  24-month  period  after such termination, the
Company  shall  arrange to provide you with life, disability, accident

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Letter to Mr. Fagan
Page 2
May 24, 1999



and  health insurance benefits substantially similar to those that you
were  receiving  immediately prior to termination.  Benefits otherwise
receivable  by you under this subsection will be reduced to the extent
comparable  benefits  are  actually  received by you from a subsequent
employer  during  the  24-month period following your termination, and
any  such  benefits  actually received by you shall be reported to the
Company.

     "Cause"  is  defined  as  (i)  willful  and  continued failure to
substantially  perform  your  obligations  under this agreement (other
than  by  reason  of  physical or mental illness) after written demand
specifically  identifying  such failure is given to you by the Company
or  (ii)  willful  conduct  by you that is demonstrably and materially
injurious  to the Company.  For purposes of this definition, "willful"
conduct  requires an act, or failure to act, that is not in good faith
and  that is without reasonable belief that the action or omission was
in  the  best interest of the Company.  Notwithstanding the foregoing,
you  shall  not be deemed to have been terminated for Cause unless and
until  there  shall  have been delivered to you a copy of a resolution
duly  adopted  by the affirmative vote of not less than three quarters
(3/4)  of the entire membership of the Board of Directors at a meeting
of  the  Board  of  Directors  called and held for such purpose (after
reasonable  notice  to  you  and an opportunity for you, together with
your counsel, to be heard before the Board of Directors), finding that
in  the  the  good  faith  opinion  of the Board of Directors you were
guilty of conduct set forth above in this paragraph and specifying the
particulars thereof in detail.

       Disability    is defined as (i) being absent from the full-time
performance of your duties with the Company for six consecutive months
as  a  result of your incapacity due to physical or mental illness and
(ii)  after  subsequent  written  notice  of termination is given, not
returning to the full-time performance of your duties within 30 days.

     "Good  Reason"  is  defined  as  (i) the assignment to you of any
duties  inconsistent  (except  in  the nature of a promotion) with the
position  in  the  Company that you then held or a substantial adverse
a l t e r a t ion  in  the  nature  or  status  of  your  position  or
responsibilities  or the conditions of your employment from those then
in  effect, (ii) a reduction by the Company in your annual base salary
as  in  effect on the date hereof or as the same may be increased from
time  to  time  or  (iii)  the  failure  by the Company to name you as
Chairman  of  the  Board  by January 1, 2000, in each case that is not
corrected  by the Company within 15 days after you give written notice
specifying  the Good Reason. Such termination of employment must occur
within one year after the date of the event constituting Good Reason.

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Letter to Mr. Fagan
Page 3
May 24, 1999



     3.   Non-Competition.    You agree that while you are employed by
the  Company and for two years thereafter, you shall not (i)(a) engage
in  any business, or acquire an interest in any business as a partner,
stockholder,  proprietor  or otherwise (except as the beneficial owner
o f   publicly-traded  stock),  or  become  affiliated  as  an  agent,
consultant, employee, director or officer of or provide any consulting
services to any business having its principal place of business within
the State of Florida that is in competition with any business in which
the  Company  is  engaged  or  (b) engage in, or provide services with
respect  to,  strategic  planning,  marketing or sales in the State of
Florida  for  any  such  business regardless of its principal place of
business;  (ii)  solicit, divert, do business with, or accept business
from  any  person who is or has been a customer of the Company if such
solicitation,  diversion  or  business has the effect of or results in
the  Company s loss of all or a portion of such customer s business or
potential  business;  (iii)  influence  or  attempt  to  influence any
employee  of  the  Company  to  terminate  his/her employment with the
Company or (iv) influence or attempt to influence any agent, customer,
supplier  or  distributor  who  has  a  business relationship with the
Company  to  cease  or adversely alter its business relations with the
Company.    For  purposes  of  the above paragraph,  Company  shall be
deemed to include all of its subsidiaries.

     4.   Confidential Information.  You agree to receive confidential
and  proprietary  information  of  the  Company  and  its subsidiaries
acquired  or  developed by you during your employment with the Company
in  confidence,  and  except  as  authorized  by  the  Company, not to
disclose  or  use  such  information  to  or for the benefit of others
during  the  period  of  your employment and for a period of ten years
thereafter except to the extent such disclosure may be required by law
or such information has become public knowledge without breach of this
agreement.

     5.   Nontransferability;  Successors.  No payment hereunder shall
be  subject  to  anticipation,  sale,  transfer, assignment, pledge or
other charge.  The Company shall require any successor (whether direct
or  indirect,  by purchase, merger, consolidation or otherwise) to all
or  substantially  all  of  the  business  or assets of the Company to
expressly assume and agree to perform this agreement.

     6.   Costs of Enforcement; Interest.  The Company shall reimburse
you,  within five days after demand, for all reasonable legal fees and
expenses   incurred  by  you  in  enforcing  your  rights  under  this
agreement.    The Company shall also pay to you interest on any amount
that  the  Company  fails  to pay in accordance with the terms of this
agreement at an annual rate equal to the prime rate as reported in The

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Letter to Mr. Fagan
Page 4
May 24, 1999



Wall  Street Journal (Southeastern Edition) plus 2% from the date such
amount became due until payment is made.

     7.   Governing Law.  This agreement shall be governed by the laws
of the State of Florida, without giving effect to the conflicts of law
principles thereof.


                              Very truly yours,

                              TECO ENERGY, INC.

                              By: /s/ G. F. Anderson
                                    G. F. Anderson
                                    Chairman of the Board

Agreed to this 24 day of May, 1999.


/s/ Robert D. Fagan
Robert D. Fagan


























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