TVA's natural-gas-fueled Combined Cycle Plant in Memphis
In response to the COVID-19 pandemic, the Tennessee Valley Authority (TVA) board approved $200 million Thursday for credits to local utilities, which would include Memphis Light, Gas & Water (MLGW).
TVA will give utilities a 2.5 percent base rate credit, beginning in October. That money can be used “to allow each recipient the flexibility to apply the savings in the best way possible to invest in their communities and support those they serve.” The credit will remain in place until September 2021, the end of TVA’s fiscal year.
“The continued impact of this pandemic on our communities is unprecedented and creates continued economic uncertainty,” said Jeff Lyash, TVA president and CEO. “Because of the TVA team’s strong operational and financial performance under challenging circumstances this past year, we have an opportunity and responsibility to use TVA’s resources and expertise to provide continued support for customers, businesses and communities.”
“Our financial results remain strong and we are in a good position to do the right thing for our customers, providing people with the help they need when they need it most, while we continue to deliver our mission of service.”
TVA said, with the credit, industrial and commercial power rates will be lower than they were a decade ago.
TVA saw a 5-percent dip in power sales in its third quarter, compared to the same time last year. But operation costs, fuels costs, and maintenance expenses were lower, too.
“Despite the pandemic, the TVA team’s success at reducing debt and holding the line on operating and maintenance budgets have us at or ahead of plan, which results in no base rate increase in (fiscal year 2021) and none anticipated through the end of (fiscal year 2030),” said John Thomas, TVA’s chief financial officer.