Congress should reform the Tennessee Valley Authority’s governance and energy planning as the federally-owned electric utility faces growing demands for power, a renewable energy organization says in a report released Thursday.
Jonathan Geldof, a senior manager with the American Council on Renewable Energy who authored the report, noted in a Thursday presentation the TVA is unlike other utilities. The TVA is a federal corporation overseen by a board of directors appointed by the president and confirmed by the U.S. Senate. That’s in contrast to utilities in other states that must go before a state utility commission to seek approval for new power generation or have a review of future power plans.
Like other utilities, the TVA is facing a growing demand for electricity driven by data centers, new battery manufacturing and consumer electrification. The utility, which serves more than 9 million people across seven states, including Kentucky, earlier in January set a new power demand record of more than 35,000 megawatts amid frigid air sweeping across the South.
The utility has touted spending hundreds of millions of dollars on its power plants to enhance their reliability and resiliency in fiscal year 2024, an investment following rolling blackouts the utility had to impose in 2022 during a winter storm due to failures of its fossil fuel-fired power plants. The utility had to borrow a portion of its power from neighboring electric grids to meet the record power demand in January and also asked customers to voluntarily reduce power.
Geldof said that growing power demand is coming at a time when the utility may need to ask Congress for an increase in its ability to borrow funds.
“If they’re going to raise the borrowing authority, that should be coupled with some requirements to make TVA work better for customers and for project developers,” Geldof said. “Our point here isn’t to bash TVA but to point out ways that their processes can improve and make it easier to bring cheap American-made power into the valley.”
The 33-page report highlights a number of reforms that could be enacted by Congress to either provide more support for the TVA boards, bring the TVA under federal oversight for transmission and change the utility’s process for drafting an important planning document known as an integrated resource plan or IRP.
TVA spokesperson Scott Fiedler in an emailed statement said the utility wasn’t asked to provide data or input for the report and that the utility was “conducting a transparent, robust IRP process using best practices in the industry, including the participation by the public.” Fiedler said a finalized IRP from the utility would be made available in the spring.
From transmission planning to the TVA board
A panel discussing the report — consisting of an executive with Nashville-based solar developer Silicon Ranch and two other representatives from trade and advocacy groups for renewable energy — honed in on report recommendations for making changes in how the TVA plans future electricity transmission. It’s a planning process that, according to the report, has historically “ lacked transparency, with no meaningful stakeholder participation.”
Myra Sinnott, a vice president of interconnection and policy for Silicon Ranch, said the result of having a “closed doors” process in planning future electricity generation and transmission is that it “leaves a lot of folks out of the room that are trying to provide feedback on, you know, the future resources that will impact the electric bills, the air and water quality all around the Tennessee Valley.”
The report says Congress should require TVA to consider the full range of costs and benefits when planning transmission and generation — not just whether an investment provides “adequate and reliable service.”
Geldoff said transmission planning that considers multiple factors can enhance reliability of the electricity grid as solar and other renewable energy projects come online and send power to the grid.
The TVA should also be put under the jurisdiction of the Federal Energy Regulatory Commission, the report recommends, to ensure compliance with a federal overhaul of transmission planning. Also, TVA should consider more transmission among regional electricity grids to avert rolling blackouts, the report says.
“There’s going to need to be a lot more inter-regional transmission to prevent blackouts in extreme weather and to meet projected load growth,” Geldof said.
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Additionally, the report recommends Congress require the TVA to have independent staff, or potentially hire a consultant, to assist the TVA’s governing board in its decision-making and utility’s operations.
Simon Mahan, the executive director of the Southern Renewable Energy Association, said the TVA board, made up of part-time positions, has no independent third party to check the information provided to them by TVA staff. By contrast, utilities under state regulation are subject to expert scrutiny and questioning by utility commission staff.
“Those state regulatory bodies often have not only staff and expertise but also rules and regulations that allow for intervening parties like ours to come in to provide additional feedback and information at no cost to the regulator themselves,” Mahan said. “It’s not that we’re criticizing the board for making bad decisions, it’s just that we are not given enough information to know, ‘Is this truly the best decision at this right time?’”
When asked about the impact the Trump administration could have on energy planning, one renewable energy advocate pointed to a potential risk the TVA could face with “increasing its reliance” on natural gas. The TVA has proposed a significant investment in building new natural gas-fired power plants to replace its coal-fired power plants at a time when increasing natural gas exports abroad could strain the country’s supply of the fossil fuel.
“The country is increasing exports of gas that will increase the price of gas, and that will hit TVA customers really, really hard,” said Maggie Shober, research director for the Southern Alliance for Clean Energy.
This article is republished under a Creative Commons license from Kentucky Lantern, which is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Kentucky Lantern maintains editorial independence. Contact Editor Jamie Lucke for questions: info@kentuckylantern.com. Follow Kentucky Lantern on Facebook and Twitter.
Liam Niemeyer covers government and policy in Kentucky and its impacts throughout the Commonwealth for the Kentucky Lantern. He most recently spent four years reporting award-winning stories for WKMS Public Radio in Murray.
