TVA sees future after 75 years

TVA sees future after 75 years

By: AP

By DUNCAN MANSFIELD
Associated Press Writer
KNOXVILLE, (AP) — The 652-mile Tennessee River has been tamed, dammed for power and flood control, and made navigable. The 80,000-square-mile Tennessee Valley has been electrified. The health, wealth and education of its more than 8 million residents has been improved.
The Tennessee Valley Authority, created as part of Franklin D. Roosevelt’s New Deal in 1933, has had a hand in all of those accomplishments. But as the Knoxville-based agency celebrates its 75th anniversary Sunday, TVA President and CEO Tom Kilgore says its work is not done and its role is as important as ever.
“Energy is absolutely essential,” he told The Associated Press in an interview Wednesday. “If you look around the world, the countries that have really good economies had (solved) energy delivery early. And the ones that are having problems now are the ones that don’t have good energy delivery systems.
“The standard of living is tied almost inextricably to energy and how it is used. So I am confident that electric companies will be around and that TVA will survive.”
But to support a growing region, TVA believes it has to build or acquire more power plants. Demand on the TVA system has been growing 600 to 700 megawatts a year for some time now, but TVA has relied mostly on purchasing power from others to deal with the increase.
“We need to be close to self-sufficient — plus or minus 5 percent,” Kilgore said. “Otherwise we are dependent on external sources, the jobs are somewhere else and, frankly, we are dependent on the transmission, (which can be like) a physical highway that gets clogged sometimes.”
TVA also is reviving energy efficiency and conservation programs for the first time since the 1970s to meet peak hour demand. “TVA had a really good program but we let up, and now we are back having to refocus on that again,” Kilgore said.
TVA’s attempt to keep electric costs low — the agency had a decade-long rate freeze through much of the 1990s — may make it more difficult to persuade consumers to turn off the lights or adjust the thermostat.
“Well, let me say that rates are not going up so that we can force people to conserve. That is not why rates are going up,” Kilgore said. “Our rates are going up because we were short of generating capacity and we had gotten short over about a decade. We really hadn’t constructed anything in about a decade.”
Looking ahead, another concern is ensuring there is enough water for drinking, recreation and cooling power plants. “We need to use it, but use it carefully. Just like we want to do with electricity,” Kilgore said.
Much of the South has been in a drought for more than a year, but demands on water supply from growing populations go beyond that. The water wars between Georgia, Alabama and Florida are likely to spread into the Tennessee Valley to tap the Tennessee River. TVA, which controls water flow on that river through a series of dams, figures to play a significant role.
“We are going to study this independently,” Kilgore said. “I don’t think we are going to have a blanket policy that says anything one way or the other. This is such a major deal that everything will have to be looked at on its own merits.
“It is not just about TVA,” he added. “It is about the region, and about the water continuing to flow the way it has flowed in the past. And any major change to that would require a lot of study.”
There have been many changes at TVA since FDR conceived it as “a corporation clothed with the power of government but possessed with the flexibility and initiative of a private enterprise” to help an impoverished region.
TVA has become the nation’s largest public utility, supplying 159 power distributors in Tennessee, Alabama, Mississippi, Kentucky, Georgia, North Carolina and Virginia. It’s perhaps this country’s biggest booster of nuclear power — the only utility in the country now building a reactor and, like others, looking to build more.
The federal utility gets most of its energy from coal, but Kilgore said the goal is to increase nuclear to nearly half of TVA’s power mix, mainly because of the huge challenge of removing air pollutants from coal-fired power. Renewable energy may never reach more than 20 percent, which still would be about 20 times more than today, Kilgore predicted.
TVA has become a self-supporting government corporation. It has received no federal funding since 1998, yet continues to provide economic development assistance to its communities, pays millions of dollars annually in lieu of taxes and oversees water and land resources along the Tennessee River.
It has more than $20 billion in debt — mostly from trying to build too many nuclear plants too fast in the 1970s — that likely will rise with new power plant construction. It is a $9 billion-a-year, not-for-profit agency that issues bonds, but no stock.
Economic development, job creation, conservation and river management were TVA’s main focus in the early years. The focus shifted to electricity production beginning with World War II and continuing through the economic boom of the ’50s and ’60s, into today. But TVA still does all the rest.
“There are things that I think are constant and good in TVA,” Kilgore said. “And that is the mission, if you will.” A mission he expects to last at least another 75 years.
On the Net:
Tennessee Valley Authority: http://www.tva.gov
Published in The Messenger 5.20.08

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