TVA Decreases Current Debt but Proposes Future Debt Increase - TVA Board of Director's Report 3rd Qtr. 2014 - Energy Efficiency Slashed in Budget by 25%

Big News: TVA decreases its overall debt by $1.05 billion dollars for FY 2014,  but the board approved a $3 billion increase in Power Bond sales - 2015 budget, $1 billion in nuclear power debt; a rate increase was approved at 1.5% ; energy efficiency budget slashed by 25%.

KEY PRESENTATION POINTS - TVA BOARD APPROVED:

1) a $10.7 billion budget for fiscal 2015; 2)  a rate increase was approved at 1.5%; 3) increase debt by $3 billion-power bond sales; 4) TVA will spend $3.5 billion on new projects in fiscal 2015 -- the highest capital budget in TVA's history. 5) $1 billion approved for 2015 nuclear expansion; 6) TVA's debt increase by $1 billion next year, this will  increase TVA's total debt obligations above $28 billion. TVA has a $30 billion statutory debt limit. 7) TVA will have eliminated 2000 jobs by September of 2014. 8) Reduce energy efficiency measures by 25%. This resulted in a comment from board member Dr. Marilyn Brown, an Energy Efficiency Expert from Georgia Tech. She said: "TVA Energy efficiency provides a significant benefit to TVA and its customers and I believe this cut is a reflection of a false economy, it is penny wise and pound foolish...co-generation and combined heat to power is an untapped asset." 

Dr, Marilyn Brown

Although Dr. Brown raised questions, there was no stand for what is right. Justifying bad decisions with a speech does not provide confidence in the TVA Board. It is not Dr. Browns fault, at least she spoke up, all bare responsibility. Folks, slashing that which saves money for rate payers in order to make TVA Executives feel good is ridiculous and a dangerous precedent for those who are suppose to govern the TVA. This confirms the notion of "rubber stamp decision making," all has been discussed and approved before hand.

ENERGY EFFICIENCY GETS THE AX!

Why do leaders on this board, who should know better, vote for that which benefits executives instead of the people whom they serve. Did the CEO or any executive agree to cut their pay and bonuses by 25%???

                                          TVA CEO

 2015 PRIORITIES as expresed by TVA's CEO/President Bill Johnson

(CLICK ON IMAGES BELOW FOR AN EXPANDED VIEW)

OLD STORY FOR TVA

TVA rate increases were a primary reason for the closing of the Revere Copper Brass and Aluminum facility in Scottsboro, Alabama and the subsequent Scottsboro Aluminum. TVA refused to negotiate with the company, they closed their doors.

""Charles Chapman, group manager of energy and reliability at the Dalton, Ga. -based Shaw Industries, said TVA rates are higher for Shaw than those of Southern Co. or Duke. Shaw operates about 50 plants nationwide, including more than 30 in the Southeast. Three years ago, Shaw moved a plant three miles to relocate from TVA to Southern's territory to save more than 25 percent on its energy costs.In the past, TVA had more competitive rates, but we've seen a substantial ebb up over the past eight or nine years," Chapman said. "Bill Johnson has done a great job, but we'd like to see more.""  http://www.timesfreepress.com/news/2014/aug/22/tva-cuts-staff-spending-but-boost-rates-15/

                                             TVA FINANCES

From the Chattanooga Times Free Press (link above)

 By the numbers - TVA 2015 Budget

* $10.7 billion - Budget for fiscal 2015, down from the $11.2 billion budget in the current fiscal year when cold winter pushed up sales

* $199 million - Increase from 2 percent wholesale rate increase (1.5 percent at the retail level)
* $3.5 billion - Capital budget, the highest in TVA history
* $1.02 billion - Increase in TVA debt
* $500 million - Amount of annual operating expenses cut from TVA's budget compared with three years ago
*$594 million - Projected net income
Source: Tennessee Valley Authority

Outstanding - the $634 million excess in the cash flow was utilized to pay down the debt.

TVA PENSION WOES

TVA pension plan is $4 billion  short:  http://www.timesfreepress.com/news/2014/jun/28/tva-ends-traditional-pension-for-new-hires/

ENERGY ASSET BREAKDOWN

TVA "nuclear dog" is the cause of TVA's debt. TVA plans for additional nuclear expansion by borrowing $1 billion in power bond sales.

TVA BOARD MEETING August 21, 2014

Power Point slides link: Presentation

VIDEO OF CITIZEN PRESENTATIONS AND BOARD MEETING

On-demand video

BREDL/BEST/MATRR Member Sandy Kurtz Presentation

TVA PENSION PLAN TROUBLES

The expense of nuclear power has led to massive debt for the TVA. Is TVA on the verge of PENSION DEFAULT? Where is TVA's pension money going??

"TVA continues to withhold pension funding even as it collects funds specifically to cover pension costs from its ratepayers. Based on information I received from TVA through a Freedom of Information Act request, TVA expects to collect $528 million from its ratepayers in the current fiscal year, ending Sept. 30, 2014, to cover pension costs but plans to contribute only ...$250 million to the pension plan. In addition, TVA collected $539 million in the fiscal year ended Sept. 30, 2013, and $530 million the previous fiscal year to cover pension costs, but contributed none of these funds to the employees' pension plan...It is unclear why TVA continues to withhold adequate funding from its employees' pension plan...it would be irresponsible for Congress to allow TVA to proceed unchallenged with its current pension funding policy."
http://www.pionline.com/article/20140526/PRINT/305269990/tva-falls-through-cracks-as-plan-funding-deteriorates?template=print
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