TVA Integrated Resource Plan: Diverse Portfolio Best for Keeping Future Costs and Emissions Low

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Mar 04, 2011, 11:15 ET

KNOXVILLE, Tenn., March 4, 2011 /PRNewswire-USNewswire/ -- The Tennessee Valley Authority has filed its Integrated Resource Plan with the Environmental Protection Agency to outline the federal utility's strategic direction for providing reliable, low-cost and cleaner electricity over the next two decades, TVA announced Friday. The filing also includes an Environmental Impact Statement.

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The plan, titled "TVA's Environmental and Energy Future," will help TVA continue to meet regional energy demands in a sustainable manner. Implementing its proposed approach also will help TVA meet its renewed vision to be one of the nation's leading providers of low-cost and cleaner energy by 2020. More specifically, the plan will help TVA lead the nation in improving air quality and greater nuclear power production and lead the Southeast in increased energy efficiency.

The strategic direction outlined in the Integrated Resource Plan, which will be formally presented to the TVA board of directors in April, recommends a broader diversity of power-generation sources – including greater use of nuclear power, natural gas and renewable sources and less reliance on coal – to help lower emissions and control costs. Natural gas produces significantly lower emissions of sulfur dioxide, nitrogen oxides and carbon dioxide than coal, and nuclear power produces no emissions of these substances, which are factors in environmental issues such as air pollution and climate change.

TVA's new Integrated Resource Plan places greater emphasis than in the past on lowering carbon emissions and on increasing energy efficiency, which helps control future costs by reducing the need to build new power plants.

"Curbing emissions is a goal for many utilities and industries across the nation, including TVA," TVA President and CEO Tom Kilgore said. "An important way to pursue that goal, along with the goal of holding down electricity prices, is by promoting energy efficiency – because the best source of new energy is the energy that's currently wasted."

Kilgore noted that TVA staff worked closely with an external Stakeholder Review Group, comprised of representatives of customers and the business and environmental communities. TVA also held a series of meetings across the service territory to discuss the energy, economic and environmental issues facing TVA and to gather opinions and suggestions from the public.

"The members of the Stakeholder Review Group, with their broad expertise and wide variety of viewpoints, have given us greater insight into what customers expect from TVA as a power provider," Kilgore said. "TVA was created to serve the people, and we can always serve the people better when we listen to their views. The input from our stakeholders, and their participation in crafting this Integrated Resource Plan, has strengthened our process and our results."

Many U.S. utilities produce integrated resource plans to help guide their planning efforts, which involve large long-term capital investments in plants and infrastructure that often require significant lead times and complex financing structures.

TVA's Integrated Resource Plan, which took two years to develop, evaluated a number of possible future scenarios based on projected economic developments and other factors. For each potential future situation, TVA formulated options for meeting the region's electricity needs based on cost, environmental performance and other factors.

The TVA planning team emphasized that each scenario it studied, which ranged from a future economy similar to today's circumstances to an economy greatly transformed by technological advancements, was best addressed by a diverse portfolio of power-generation sources – including nuclear, natural gas, energy efficiency and renewable sources, such as wind and solar, as well as coal.

"Diversity proved to be the most prudent course in each situation – as is the case for financial investments and many other endeavors," Kilgore said. "Having access to a variety of power sources, rather than heavy reliance on any single source, reduces long-term risks and helps keep costs steady and predictable."

The Tennessee Valley Authority, a corporation owned by the U.S. government, provides electricity for utility and business customers in most of Tennessee and parts of Alabama, Mississippi, Kentucky, Georgia, North Carolina and Virginia – an area of 80,000 square miles with a population of 9 million. TVA operates 29 hydroelectric dams, 11 coal-fired power plants, three nuclear plants and 11 natural gas-fired power facilities that can produce about 34,000 megawatts of electricity, delivered over 16,000 miles of high-voltage power lines. TVA also provides flood control, navigation, land management and recreation for the Tennessee River system and works with local utilities and state and local governments to promote economic development across the region. TVA, which makes no profits and receives no taxpayer money, is funded by sales of electricity to its customers. Electricity prices in TVA's service territory are below the national average.

SOURCE Tennessee Valley Authority