The Tennessee Valley Authority said Aug. 25 that it will invest more than $2 billion in cleaner energy sources in the coming year as it continues to reduce operational costs and debt.
The Board of Directors on that day approved TVA’s capital plan and budget for fiscal year 2017. The $10.37 billion budget is $330 million less than the prior year.
“Our work is bounded by certain strategic imperatives – rates, debt, assets and stewardship – that require us to deliver excellent performance in order to maintain low rates, be responsible stewards, live within our means and manage TVA’s power system to deliver reliable, low-cost energy,” said TVA President and CEO Bill Johnson. “This budget is in keeping with TVA’s long-term financial plan, which has helped us manage our business to a lower cost structure as businesses and consumers use less energy. It reflects a modest, incremental rate increase that ensures we make necessary investments in the power system and manage down debt.”
Johnson highlighted TVA’s continued work in diversifying the energy generation fleet including:
- the completion of Watts Bar Nuclear Plant Unit 2 as it nears commercial operations;
- the Paradise, Ky., coal plant’s new natural gas units expected to begin operation next summer; and
- the Allen gas plant in Memphis, at the site of an old coal plant, that’s nearing 25% completion and scheduled to begin operations in 2018; and
- the investment of more than a billion dollars in clean air equipment at the Gallatin (Tenn.) and Shawnee (Ky.)coal plants.
Cost-effective, renewable energy is also playing a more important role in TVA’s diverse portfolio. In 2015, 13% of the electricity TVA generated or bought was renewable, including hydro production.
During Johnson’s report to the board, he said that energy demand is not growing and even with healthy economic growth overall, the growth in power demand has been essentially flat for the past five years. “We expect load growth to stay flat for the foreseeable future,” Johnson said. “Our market is changing, and we and our customers are working to adapt to new business conditions that include reduced energy needs and increased demand for energy efficiencies and renewables.”
TVA recently announced the establishment of a new business unit focused on Distributed Energy Resources and the energy delivery marketplace. The group will be responsible for working with TVA’s customers in business development, pricing and contracts, technology innovation, energy efficiency and demand response and renewable programs and products.
In other business, the board approved a seven-year contract with Day & Zimmerman for nuclear maintenance and modifications services.
The Tennessee Valley Authority is a corporate agency of the United States that provides electricity for business customers and local power distributors serving more than 9 million people in parts of seven southeastern states.