EPB, Large Power Users Not Faring Well Under TVA Demand Charge

Friday, May 16, 2014

EPB officials said power distributors and high-volume industrial users are not faring well under a TVA switch to a power demand charge.

When TVA put in the charge, it was said to be designed to reduce peak power demand and find alternatives to building more expensive power plants. It was also said to be revenue neutral for TVA.

However, EPB board members were told Friday that under the change for the current fiscal year TVA has benefited by about $7 million that would ordinarily be in the EPB budget.

It was also noted that EPB has been hit by a cycle of expensive storms. 

Harold DePriest, EPB president, said EPB is ending the budget year with just about a $1 million gain overall. He said were it not for all the profit the TV, phone and Internet side has brought, "We would be $20 million in the hole right now."  

He said other distributors without all the fiber optic income are in worse shape.

Mr. DePriest said the distributors are making an appeal to TVA over the issue, and he said TVA officials are aware of the problem. But he said it takes time for any such changes to be effected. 

He said the demand charge is also increasing costs for high-volume power users like Signal Mountain Cement.

Greg Eaves, chief financial officer, said FEMA will provide some reimbursement for a recent storm. But he said such payments usually take at least a year.

EPB expects a check in the mail "any day" from FEMA in connection with the 2011 tornadoes.

The EPB board was also told that no rate increase is projected for the upcoming budget year.


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