Tennessee Valley Authority boosts conservation budget fourfold as public reels before rate hike

The Tennessee Valley Authority and its distributors are planning to expand their conservation programs this fall for consumers facing the biggest yearly jump in electricity prices in TVA’s 75-year history.

TVA Vice President Joe Hoagland said the agency will boost its budget for energy conservation and efficiency from $22 million this year to $99 million in fiscal 2009, which starts Oct. 1. The increase comes as TVA prepares to boost its wholesale electricity rates by 20 percent in October, following nearly 14 percent of combined rate and fuel-cost adjustment increases this spring and summer.

Mr. Hoagland urged TVA consumers to limit their electricity usage, especially during peak demand periods, to help save money for both TVA and themselves. TVA is spending more than $3.3 million a day to purchase power, up 76 percent from the prior year, because of the drought-induced drop in TVA’s hydroelectric generation.

TVA is planning to enhance its Energy Right and Generation Partners programs, provide more online and in-person energy audits for customers and develop new incentives and pricing programs to limit peak power consumption, Mr. Hoagland said.

TVA also will continue to provide consumer information and education in the next year to reach its goal of cutting TVA’s peak power demand by at least 154 megawatts, up from the 2008 goal of cutting the peak by at least 64 megawatts.

“We expect to begin rolling the new programs out by the first of the year,” Mr. Hoagland said.

In the past year, more than 36,000 of TVA’s online energy audits have been completed and TVA has worked with seven of its distributors to test walk-through energy audits for more than 1,000 customers.

Glenda Foster, a Lookout Mountain homeowner, got an energy audit last week from EPB after her monthly electric bill jumped by more than 50 percent because of rate increases and an inefficient heating and cooling system and insulation.

In response to the audit, she bought a new dual-fuel heat pump and is installing recommended upgrades in insulation and caulking.

“The higher bill got our attention and the audit pointed out a lot of things we already knew but hadn’t done,” she said. “We hope to cut our bills significantly.”

EPB President Harold DePriest said the Chattanooga utility is developing plans to soon begin providing supplies for local churches, charities and volunteers to aid low-income persons with home conservation upgrades. TVA will provide $150,000 toward the effort, Mr. DePriest said.

Alex Tapia, program manager for the Southeast Energy Efficiency Alliance in Nashville, said TVA’s expanded conservation program “is an excellent step in the right direction,” noting that “efficiency is a cheaper source of power” than building most new power plants.

Sandy Kurtz, an environmental consultant and member of the anti-nuclar group Bellefonte Efficiency and Sustainability Team, said homeowners can ease the pain of this fall’s rate increases by focusing on such efficiency moves and TVA could lessen its need for costly power purchases and new plants through more conservation efforts.

“TVA should avoid future rate increases by putting their money into conservation, ramping up their energy efficiency program, expanding solar and wind programs, and canceling extravagant efforts to build new and risky nuclear plants,” she said.

U.S. Sen. Lamar Alexander, R-Tenn., co-chairman of the TVA Congressional Caucus, insists more nuclear power will actually save both the environment and TVA ratepayers by providing a clean and less expensive energy source than TVA’s existing coal plants.

But during an appearance in Chattanooga Thursday, he also praised TVA for focusing again on conservation, which the agency pioneered in the 1970s but largely abandoned a decade later.

“TVA was slow to move toward conservation, but now they are picking that up in a big way and I’m glad to see that,” Sen. Alexander said.