Pandemic Brought $185 Million Revenue Hit To TVA, But Many Expenses Were Lower

Tuesday, November 17, 2020

The Tennessee Valley Authority reported $10.2 billion in total operating revenues on more than 151 billion kilowatt-hours of electricity sales for the fiscal year 2020. Sales of electricity were about five percent lower compared to the prior year due to overall milder weather and impacts of the COVID-19 pandemic.

Total operating revenues decreased about nine percent from the prior year driven primarily by lower sales volume, lower effective base rates, and lower fuel cost recovery revenues.

 TVA estimates base revenues were approximately $185 million lower due to the impacts of the COVID-19 pandemic. 

TVA’s fuel, purchased power, operating and maintenance, tax equivalents, and interest expense were all lower in 2020 than in 2019. TVA’s fuel and purchased power expense was 15 percent lower year-over-year, primarily driven by lower effective fuel rates and lower energy sales due to impacts of milder weather and COVID-19, as well as the increased generation of nuclear power.

“TVA’s strong financial position helped us absorb the impacts of the pandemic in 2020 and still provide extra support for our customers,” said Jeff Lyash, TVA president and chief executive officer. “And TVA was in a position to reduce effective power rates for customers for 2021, when our communities need relief the most. This would not have been possible without the ongoing financial discipline of our employees.”

Operating and maintenance expense was $370 million lower, driven primarily by less project write-offs and regulatory asset recovery for certain environmental cleanup costs that did not occur in the current year. TVA continues to implement various cost savings initiatives in response to the COVID-19 impacts. 

Interest expense was $1,142 million in 2020, which was a five percent decrease from 2019, driven by lower average debt balances. TVA’s debt has decreased to the lowest level in over 30 years. 

“TVA is one of the most competitive utilities in the nation, as our results through 2020 demonstrate,” said John Thomas, TVA’s chief financial officer. “The effective rate our customers pay is among the lowest in the country, and has been stable for the past seven years even while we have reduced debt by $6 billion and invested over $15 billion in the power system - and we remain on target to keep rates stable for this decade.”

Additional highlights from TVA’s fiscal year 2020 include:

  • As part of the Strategic Financial Plan approved by the TVA Board in 2019, TVA began offering a 20-year Valley Partnership Agreement option to local power company customers. As of Nov. 16, 2020, 142 local power companies had accepted the offer and are now TVA long-term partners. Bill credits available to long-term partners totaled over $163 million in 2020.
  • Due to higher volatility in the financial markets from COVID-19, TVA increased its target balance of cash and cash equivalents in March 2020 as a precautionary measure. TVA continued to hold higher target cash balances at Sept. 30, 2020. TVA has maintained continued debt market access since the outbreak of the pandemic. In May, TVA issued $1 billion of power bonds to take advantage of the historically low interest rate environment and to meet its ongoing funding needs.
  • In response to the pandemic, TVA is offering up to $1 billion of credit support available as an option to local power companies through the deferral of wholesale power payments, based on the needs of individual local power companies, along with the Back-to-Business credit program that provides relief to certain larger customers when returning to operations. TVA remains committed to supporting communities and customers across the Tennessee Valley during the region’s ongoing recovery.
  • Despite record-setting heat experienced during October 2019 and record-setting cold during November 2019, TVA's service territory experienced overall milder weather during fiscal year 2020. Total heating and cooling degree days in the year ended Sept. 30 were 6% below normal, and 9% below the same period in the prior year.
  • TVA continued to maintain 99.999% reliability in delivering energy to its customers, despite record setting weather.
  • Rainfall and runoff in the Tennessee Valley in 2020 were 150% and 156% of normal, respectively. 
  • TVA's reliability and economic development efforts helped recruit or expand 188 companies into the TVA service area. Over $8.6 billion in investments and more than 67,000 jobs were created or retained in 2020.

Walker County Arrest Report For Nov. 16-22

Latest Hamilton County Arrest Report

Walker County Probate Court To Be Closed Due To COVID-19


Here is the Walker County arrest report for Nov. 16-22: DAVIS SCOTTY EUGENE W/M 40 **** OFFICER JONES OBSTRUCTION, DRIVING ON SUSPENDED WILLIAMS TARA ELIZABETH W/F 38 **** OFFICER JONES ... (click for more)

Here is the latest Hamilton County arrest report: BLANSIT, LESLEY NICOLE HOMELESS CHATTANOOGA, 37405 Age at Arrest: 38 years old Arresting Agency: Hamilton County VIOLATION OF PROBATION ... (click for more)

Walker County Probate Court will be closed until at least Dec. 7 due to COVID-19. The Probate Court office is located on the bottom floor of the Walker County Courthouse in LaFayette. Judge ... (click for more)



Breaking News

Walker County Arrest Report For Nov. 16-22

Here is the Walker County arrest report for Nov. 16-22: DAVIS SCOTTY EUGENE W/M 40 **** OFFICER JONES OBSTRUCTION, DRIVING ON SUSPENDED WILLIAMS TARA ELIZABETH W/F 38 **** OFFICER JONES GIVING FALSE NAME, DOB TO LEO O’KELLEY JAMIE LYNN W/M 39 **** OFFICER WOOTEN PROBATION (F), FTA (M), OBSTRUCTION (M), THEFT BY TAKING VEHICLE (F), DRIVING ON SUSPENDED, NO INSURANCE, BRINGING ... (click for more)

Latest Hamilton County Arrest Report

Here is the latest Hamilton County arrest report: BLANSIT, LESLEY NICOLE HOMELESS CHATTANOOGA, 37405 Age at Arrest: 38 years old Arresting Agency: Hamilton County VIOLATION OF PROBATION POSSESSION OF CONTROLLED SU VIOLATION OF PROBATION THEFT OF PROPERTY ---- BRAZIL, JERRY WAYNE 1914 GUNBARREL ROAD APT 314 CHATTANOOGA, 37421 Age at Arrest: 42 years old Arresting ... (click for more)

Opinion

County Employees Need A Bonus Too

A few weeks ago we learned that Sheriff Jim Hammond was asking for a second raise. Earlier this year Hamilton County employees were notified that "due to COVID-19" there would be no raises for employees of any kind this year. I guess Mr. Hammond didnt get that memo about no raises. Why is it that some employees will be getting a raise and others are not? That doesn't really ... (click for more)

Roy Exum: The Facts - Deer & Trees

On Saturday deer season opens in Tennessee, and just as predictably as Tuesday will be the first day of December, the tree huggers will soon come running, clutching their “Bambi” books and bashing – if you please – the best conservationists among us. Those who hunt, and, yes, there is an undeniable thrill to the sport, do more for nature’s balance and the good of the land than any ... (click for more)

Sports

Lady Vols Impressive In 40-Point Rout Of Western Kentucky

Kellie Harper expected one of two teams to show up for Tennessee’s women’s basketball opener on Saturday. The Lady Vols coach anticipated a squad that was going to be either too tentative or one that was overly aggressive. She got some of first version at the outset before UT found a better gear in routing Western Kentucky 87-47 at Thompson-Boling Arena. The Lady Vols were ... (click for more)

Owens Scarfs Up Loftovers Notching His 20th Victory; McCarter And Brooks Double Up With Back-To-Back Wins

Jimmy Owens of Newport, Tn., scarfed up the leftovers Saturday at 411 Motor Speedway outside Gatlinburg, devouring the $5,000 prize for the Iron-man series finale. The 5th annual "Leftovers" event at the 3/8's mile Mitch McCarter family facility drew an amazing series record of 52 Super Late Model entries that saw "The O-Show" notch his 20th victory of the season. Owens' racing ... (click for more)