The Tennessee Valley Authority Board of Directors continued its oversight of TVA’s mission of service at its meeting Thursday while following public health guidelines intended to protect team members, the public and their families. The board’s scheduled quarterly meeting was conducted in a virtual format and streamed live online for the public.
In response to the COVID-19 pandemic, TVA has dramatically altered how it does business. Nearly half of TVA’s workforce is teleworking while those staffing critical operational facilities undergo enhanced health screening and physical distancing requirements.
Working within these limitations, TVA is continuing to carry out its unique mission to support critical infrastructure that powers hospitals, emergency response agencies and homes. TVA’s power generation and transmission system remains stable and reliable, its river management system continues to support flood control and navigation, and crews quickly responded to restore power in areas impacted by recent tornado outbreaks.
“Nearly 87 years ago, TVA was born in a time of great need with a mission to make life better for the people of the Tennessee Valley and now, more than ever, that mission of service is critical,” said TVA President and CEO Jeff Lyash. “The challenges we face today are unprecedented and the needs are just as great. I am proud of the way our team has supported the people and communities impacted by COVID-19 and severe weather while laying the groundwork for the region’s recovery once the current crisis is past us.”
To address the economic uncertainties the outbreak has created, TVA has provided all 154 local power companies it serves regulatory flexibility to quickly respond to their customers’ needs. It also is providing up to $1 billion in credit support to local power companies through a needs-based deferral of wholesale power payments. Similar support programs have been developed to support large industrial customers.
In addition, TVA is partnering with local power companies on a $2 million matching funds program to support local agencies that address individual hardships and is working to raise awareness of the federally-funded Low Income Home Energy Assistance Program to provide a helping hand to those hardest hit by these challenging times.
The key to quickly implementing these programs has been the strength of TVA’s financial position.
“The progress we’ve made putting our long-term financial strategy in place over the past six years has strengthened our balance sheet with significantly reduced spending and debt levels,” said TVA Chief Financial Officer John Thomas. “The recovery from the COVID-19 outbreak will impact the whole area for some time. TVA and public power must leverage their ability to support a quicker recovery for our communities and businesses.”
For the six months ending on March 31, TVA’s operating revenues were down about 7%, primarily due to milder winter weather with only a slight impact from COVID-19. Fuel and purchased power costs were down 11% year-over-year. In addition, interest expenses were down 4% on reduced debt levels that are at their lowest point in nearly 30 years.
TVA’s Economic Development team will also play a role in the region’s recovery and is already working with state and local partners on programs to help that effort. In the first six months of Fiscal Year 2020, TVA helped attract or retain more than 51,500 jobs and bring more than $6.1 billion in capital investment to the area.
The board approved TVA’s updated Environmental Policy, which will build on TVA’s success in providing reliable, increasingly clean energy at the lowest feasible cost while supporting environmental sustainability and economic growth. Today, more than half of TVA’s energy is carbon-free and its overall carbon emissions are on target for a 60% reduction over 2005 levels by the end of 2020.
The board was briefed on TVA’s ongoing efforts to ensure transparency in its operations. Although COVID-19 precautions precluded the board’s typical in-person public listening session the day before the board meeting, individuals submitted 30 written comments on a variety of topics. Internal and external benchmarking reviews indicate TVA meets or exceeds many industry best practices on transparency and could continue to benefit from further strengthening the public’s voice on how TVA fulfills its mission.
In other business, the board:
- Approved TVA’s updated Natural Resource Plan, which guides how TVA fulfills its resource stewardship mission to help sustain the area’s natural resources for the people of the Tennessee Valley. The updated plan was developed with input from the public and the multi-stakeholder Regional Resource Stewardship Council.
- Approved a board practice on Commercial Energy Agreements, delegating authority to the CEO to enter into agreements of up to 3,000 megawatts which the board will continue to oversee through the budgeting process.