Answers were left blowing in the wind at Monday’s Tennessee Valley Authority Roundtable convened by Republican U.S. Sens. Lamar Alexander and Bob Corker. TVA CEO Bill Johnson twisted in the gale from the right, unable to explain how TVA’s plan to buy wind energy from Oklahoma would help fulfill its statutory mandate to provide the lowest-cost electricity possible.
orker and Alexander made clear the criticality of low-cost power to industrial recruitment. Energy-intensive industries – think manufacturing, basic materials, etc. – typically pay higher wages and offer better benefits, the very types of jobs that can narrow the wage gap and enlarge and enrich Tennessee’s middle class.
Data from the federal Energy Information Administration shows Tennessee’s average industrial electricity rate in 2014 was 6.58 cents per kilowatt-hour, ranking Tennessee seventh of nine states in our region, lower than only Mississippi and Virginia. Tennessee’s industrial rate was 16 percent higher than lowest-cost Kentucky and 11 percent higher than second-lowest Arkansas.
Asked why Tennessee ranked so poorly, Johnson disputed the facts, saying TVA’s data from the EIA showed TVA’s rates ranked second lowest in the region. Regardless, the question remains as to why government-owned, not-for-profit TVA is not the lowest-cost provider since it pays no dividends to shareholders, unlike its competitors.
“I think our ratepayers and our jobs are better served when TVA sticks to its mission of low-cost power instead of chasing the latest energy fad,” Alexander said. “The goal of TVA is not to build windmills; it’s to provide low-cost electricity.”
“Nothing is more important to me than Tennesseans’ standard of living and our state’s ability to attract high-quality jobs, and TVA’s ability to carry out its mission of providing low-cost, reliable power directly impacts that,” said Corker in a statement. “Our discussion (Monday) focused on ensuring TVA is operating in the best interest of ratepayers and hardworking Tennesseans and is not swayed by outside influence to over-invest in power sources like wind and solar that do not make sense in Tennessee.”
Corker told a cautionary tale about Germany’s “romantic” idea of a renewable energy revolution – eschewing nuclear and coal for more solar and wind. A Wall Street Journal report last year showed Germany’s industrial rates more than double those in the United States. Corker said some German industrial companies are considering coming to America to save on energy.
After incurring the crosswinds from Alexander and Corker for the better part of an hour, Johnson stumbled badly when asked about reliability. Johnson agreed nuclear is online more than 90 percent of the time, while wind power actually works only 30 or 40 percent of the time, which means the wonders of wind are both more expensive and less reliable.
Corker and Alexander held Johnson accountable, but because of unseen, unknown outside influences, TVA’s romantic fad for wind could blow good jobs into neighboring states with cheaper electricity.
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