Source: Knoxville News Sentinel |  | November 1, 2018

TVA West Tower

Photo: Michael Patrick/News Sentinel

Tennessee Valley Authority provides electricity to 9.7 million people in seven states, but it’s not immune to market changes – and the power industry is changing.

new policy brief has five recommendations for TVA’s future, emphasizing rates and service tailored to individual customers and driven by big data. It’s from the University of Tennessee’s Howard H. Baker Jr. Center for Public Policy, written by J. Scott Holladay, a Baker Center Fellow and associate professor of economics.

Demand for power is flat or declining, natural gas is as cheap – and more efficient – as coal, and new technology lets small, local producers make their own power or even sell it back to the grid, the report says.

The Tennessee Valley Authority is a federally owned electricity corporation. An act of Congress established the company in 1933 to help the Tennessee Valley overcome environmental and economic problems. Now TVA provides power for the entire state of Tennessee and parts of six bordering states. The corporation also provides flood control, navigation and management for the Tennessee River System. The company has a diverse power plant portfolio that includes nuclear, fossil, diesel, hydroelectric, natural gas, solar and wind energy. The corporation funds its own operations by the sale of its electricity to power distributors. Wochit

The report “underscores why TVA has focused so heavily on improving and evolving to better serve the people the Tennessee Valley,” according to Jim Hopson, TVA public information officer.

Employees of TVA and related firms are working on an updated plan for the agency’s coming decades, he said via email.

“Their work will build on the steps we’ve already taken in many of the areas highlighted in the Baker Center report,” Hopson said.

If TVA resists change, other utilities or even start-ups and small independent generators will ultimately gain a price advantage, the report warns.

“The largest risk to TVA is inaction,” Holladay wrote.

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