My Statement to the TVA Board on Major Rate Change Approved May 10, 2018

On May 10, 2018, one week before the Tennessee Valley Authority’s 85th anniversary, I made the trip to historic Muscle Shoals, Alabama in order to publicly deliver my comments to the TVA board meeting before their planned vote on their rate restructuring policy, which includes a new mandatory fee on the wholesale rate of electricity charged by TVA to their 154 captive local power companies.

You can read my comments in full below, and see the comments from others who joined a statement issued immediately after this poorly-conceived rate design was approved. This decision comes on the heels of continued distrust and public outcry over TVA executives’ ongoing lack of transparency, unjustified spending on luxury air travel, and out of touch “leadership” of the people of the Tennessee Valley. It is further evidence of the tone deaf leadership currently in control of TVA and comes just days before the agency commemorates 85 years in the Tennessee Valley region.

Dr. Stephen A. Smith, Statement Addressing TVA Board Meeting 

How many of you have ever attended a public service or utility commission hearing on rate making? [I asked this of the TVA Board because none of the current Board members appear to have any electric regulatory experience, yet are the regulators of 154 local power companies rates in 7 southeastern states and were on the verge of making a monumental rate design decision without any independent rate review] Likely very few, if any? It has been with great difficulty that my staff and I have attempted to seek public information on the regressive rate change that is before you today. Initially, we were led to believe that TVA’s rate change was designed to help advance Distributed Energy Resources (DER). It was only through a series of leaked documents, partially filled FOIA submissions, and multiple open records requests that clearly showed us this was indeed deception on a grand scale.

TVA’s intent all along has been to use its self-regulated federal monopoly rate authority to negatively distort the market for energy efficiency and customer owned solar power and shift a greater share of the perceived risk for lower demand growth on to its captive LPC servants. The sad, and yes immoral, unintended consequence will be adding more cost to our region’s low and fixed income citizens.

In almost every other state, including every state surrounding TVA’s service territory, has an independent state regulatory commission to review and attempt to fairly engage an open public proceeding before an incumbent utility is allowed to change its rates. Not here, no, that’s not how we roll… After initially threatening a “categorical exclusion” under NEPA, TVA’s only half-hearted attempt at public engagement, TVA staff put together a hastily prepared Environmental Assessment (EA). The draft EA raised more questions than it answered, and then TVA denied our request for a public meeting for more clarity and also denied our request for a comment period extension. Then, on cue, 72 hours before today’s board meeting, TVA quietly releases the final EA, failing to adequately respond to the over 1,700 public comments raising concerns about this rate action, and at times seemly mocking the commenters for not fully understanding TVA’s slides that were not provided openly by TVA with explanation to the affected public, but had to gather through open records requests from behind closed-door meetings with limited stakeholders.

And finally, today, with the veneer of a public meeting, a preordained decision that has been carefully spoon fed to you by the executive staff awaits us all. This is not public power’s finest hour, no, this is a textbook example of how NOT to run a meaningful public participation process. The only silver lining in this insidious plot is that you have AWOKEN us to the lack of transparency in the fixed charges on 80% of the local power companies residential customers monthly bills you “regulate”, a FACT the executives likely conveniently forget to tell you, and when coupled with the explosive increases of these mandatory monthly fees over the past few years, we now move to a different playing field then this pretense we are witnessing today. So Bill [Johnson], congratulations for jamming this one through, and take solace while you and your millionaire jet set execs are zipping around in the clouds, knowing that we the people will be working the long game at the grassroots. [end of prepared comments]

From TVA’s humble beginnings 85 years ago on the shores of the Tennessee River in Muscle Shoals (as pictured above), it’s had a long and proud history although it was never without mistakes. Past leadership prided itself on being for the people, if they drifted from that mission, congressional oversight would guide them back to their core mission.

However, TVA’s current leadership and direction have resulted from being a self-regulated federal monopoly with no independent oversight nor accountability. Today, a dysfunctional Congress is missing in action and TVA has been taken over by executives more focused on self enrichment than helping the people of the Valley. TVA’s corporate luxury jets (pictured above) sit on the tarmac at Muscles Shoals the morning of the recent board meeting, May 10, 2018. Clearly this is not your grandparent’s TVA created by Congressional charter back on May 18, 1933 but the people of the Tennessee Valley deserve a chance to help put the public back in public power. Join us!

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1 Comment

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As a TVA customer the lack of transparency is unacceptable to me. My monthly bill says that I am an EMC member and I vote for the EMC Board. Not long ago the entire Board was replaced for mishandling EMC funds. This is called accountability and is absolutely necessary to operate a public utility. Why is this TVA Board not held accountable?


Comment by Dennis Stansell on May 21, 2018 10:32 am


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