TVA President Jeff Lyash on Tuesday outlined how TVA has responded to COVID-19 and said the company’s fiscal state remains healthy.
“Among other things, those efforts include establishing enterprise-wide teams to coordinate TVA’s response with local power companies and other responding agencies,” said President Lyash. “They’re moving all administrative and support personnel to telework to assist with physical distancing.”
He said the company is working on plans that would allow the company to slowly go back to normal operating procedure, albeit in a “slow and measured” way.
He said the company will prioritize worker safety during this process. In addition to this, Mr. Lyash spoke about the large amount of money available in support for power companies.
“TVA is making up to $1 billion of credit support an option available to local power companies through the deferral of wholesale power payments,” said the company president. “TVA is also partnering with local companies and providing $2 million in matching funds for local initiatives to address hardships made by the pandemic.”
He said TVA is in “sound financial position” and has reduced debt by almost $5 billion in recent years.He said the debt level is at the lowest level it has been in almost 30 years.
“Strengthening partnerships with our customers was already one of our primary goals for this year,” said President Lyash. “I’m pleased to report that 139 of our 154 local power companies have entered into 20-year agreements with TVA, which strengthens our collective ability to serve.”
The president also emphasized TVA’s focus on investing in renewable energies, which include water, wind, and especially nuclear power. He said coal usage has been slashed in recent years, as the company focuses on what he called a “greener future.”
“On this, the 50th anniversary of Earth Day, I am pleased to say TVA is on track to reduce its carbon emissions by 60 percent below peak 2005 levels in 2020,” said the president, “and that we will see a 70 percent reduction by 2030.”
President Lyash also spoke about TVA’s planned further investment in solar energy, reminding listeners that TVA launched the “Green Invest Program” in 2019 to meet the renewable goals of other private companies.
“This will be achieved by building new solar facilities in the Tennessee Valley,” said the president. “TVA expects to publish a corporate responsibility report this summer which will speak more about these important clean energy achievements and our goals.”
Chief Financial Officer John Thomas said the company ended the first six months with net income of $467 million. Meanwhile, because of mild weather during much of the winter, overall power sales have been down by three percent.
He said the base rate and fuel rate has been lower for customers, and is four percent lower compared to last year’s. He said that because of the prevalence of nuclear power, 60 percent of power comes from carbon-free sources. However, operating revenues are down $376 million from last year. In terms of net cash, that is down $850 million from last year as well.
In regards to how COVID-19 has affected TVA, the pandemic has made TVA “work to make sure we have sufficient financial liquidity should there be any issues over the short turn.” Mr. Thomas said TVA was able to fully fund bond maturity in March in regards to short-term debt.
“There’s an outlier in terms of where we’re seeing the impact on large industrial, and that’s on the transportation,” said Mr. Thomas. “That’s where we’re seeing most of the impact.”
“Lower effective rates is our goal for our customers,” said Mr. Thomas when recapping the presentation. “We’re closely monitoring what is going on at the micro-industry level to best predict what will happen from an economic and energy sales aspect for TVA.”